The massive business shutdown in the United States has posed a unique opportunity for Auto Insurance carriers; many have jumped onboard and announced premium refunds, in the amount of 15-20% of 2 months premium (carriers are differing on the months and percentage amounts). Since the majority of the country is on a “stay at home” mandated order, there is considerable less driving.
Progressive announced to it’s agency force, subject to approval by state regulators, personal auto customers who have a policy in force as of April 30 will be credited 20% of their April premiums in May and personal auto customers with a policy in force as of May 31 will be credited 20% of their May premiums in June. They estimate that the sum of these two credits will total approximately $1 billion and may offer additional credits in the upcoming months.
Safeco Insurance (subsidiary of Liberty Mutual) announced that Personal auto insurance customers will receive a 15% refund of two months of their annual auto premium as of April 7, 2020, pending regulatory approval. The refunds will begin in April and will be issued either by check or in the manner the customer made their most recent payment. The payments will happen automatically.
Other carriers that are considering givebacks are Allstate, American Family, State Farm and Geico; I’m sure we’ll see more coming on board as the days pass. The good thing is, customers won’t have to request anything; the refunds will happen automatically.
If the Coronavirus continues longer than expected, carriers may consider additional give backs; of course, subject to approval by State regulators.
Stay tuned to our website blog and email blasts for more information as we receive it. Stay healthy!