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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsLess Driving, Fewer Accidents: Car Insurers Give Millions in Coronavirus Refunds
One of the largest car-insurance companies in the country, Allstate Corp., and a smaller Midwestern auto insurer are refunding hundreds of millions of dollars to their policyholders, citing a dramatic drop in accident claims from Americans hunkered down in their homes.
Allstate said it would dispatch more than $600 million in shelter-in-place payback checks, while American Family Mutual Insurance Co. said it is returning $200 million to its smaller policyholder base. The moves highlight a looming dilemma for the auto-insurance industry: A potentially large Covid-19 windfall is taking shape at the same time many customers are suffering financially from lockdowns covering much of the U.S.
Allstate said most of its customers would receive 15% of their monthly car premium in April and May. American Family is returning $50 per insured vehicle. That adds up to what American Familys actuaries say represents what the carrier already has savedand expects to save through mid-Juneas a result of the reduced claim volume.
Compared with last year, claims were down 20% to 40% weekly from March 11when the World Health Organization declared the pandemicthrough April 3, Ms. Yancy said. The Madison, Wis., insurer estimates that policyholders drove 40% fewer miles in the last three weeks of March. The company operates in 19 states.
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Trade groups believe the pair are the first car insurers in the U.S. to share their Covid-19-related windfall. Wall Street analysts believe many will follow suit. Mutual insurers like American Family that are owned by their policyholders may find a decision to provide financial relief easier to make, but publicly traded insurers could also opt to pass along some of their good fortune, for reasons including competitive pressure, industry executives said. Allstate is publicly traded.
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https://www.wsj.com/articles/car-insurer-american-family-gives-200-million-in-coronavirus-refunds-as-accidents-decline-11586175602 (subscription)
doc03
(35,328 posts)moondust
(19,979 posts)From an email today:
As part of GEICO's ongoing efforts to assist customers during this unprecedented time, we are announcing The GEICO Giveback which provides a 15 percent credit to all auto and motorcycle customers as policies come up for renewal, between April 8, 2020 and October 7, 2020. This credit will also apply to any new policies purchased during this period as part of our commitment to protecting the wellbeing of our customers.
Current customers can expect to see the credit when they renew. Customers do not need to take any action to receive this credit.
question everything
(47,476 posts)I think that our rate from State Farm are already low, to accommodate our seniors not driving much..