Geico car insurance premiums are dropping 10.7 percent, a move that will save Californians a total of $91 million.

The company's rate decrease affects more than 717,000 policyholders across the state starting Aug. 15. Geico is the state's seventh-largest auto insurer. It controls 5.4 percent of the California market and 5.7 percent of Sacramento's.

A cut in premiums is justified by "the reduction in claims and the dollar amount of those claims," said Insurance Commissioner Dave Jones. He announced the reduction Friday.

Geico originally sought a 4 percent increase in premiums, according to Santa Monica nonprofit Consumer Watchdog, which challenged the company's request. Consumer Watchdog said Geico had improperly estimated future claims.

Ultimately, Geico didn't challenge the 10.7 percent decrease ordered by the Department of Insurance, according to Jones.

"This massive decrease is a substantial victory for California consumers," said Todd Foreman, staff attorney with the Santa Monica organization, in a news release.

Geico's 109,000 policyholders in greater Sacramento will save an average of $122 a year, said Insurance Department spokesman Byron Tucker.

The department said Geico is the seventh auto or homeowner insurance company to have its rates reduced this year.

Contact The Bee's Dale Kasler at, (916) 321-1066 or [email protected].