Due to the coronavirus pandemic, insurance companies across the country have decided to give back to the people. Due to business closures and self-quarantine mandates, there are fewer motorists on the roads and highways. As a result, the insurance industry is seeing a drastic decrease in the number car wrecks. Since there are fewer automobile claims being paid out, the insurance companies are saving money. But instead of simply pocketing the money, many car insurance companies are issuing refunds, discounts, and credits to customers.
Allstate and American Family Insurance
On Monday, April 6, 2020, Allstate and American FamilyInsurance announced they would give back about $800 million to policyholders to account for a drop in driving – and car accidents – during the COVID-19 crisis.
“Given an unprecedented decline in driving, customers will receive a Shelter-in-Place Payback. This is fair because less driving means fewer accidents.”
Allstate will be refunding 15% of the premiums its customers paid in April for a total of approximately $600 million.
American Family Insurance will also be giving policyholders a refund. American Family Insurance will refund $50 per car they have insured with the company, for a total refund of about $200 million.
Other Insurers Follow Suit
On April 10, 2020, ten large insurance companies issued auto insurance refund programs. Customers will receive checks in the mail, some will get discounts on their next premiums, and others will find credit on their accounts.
Here is a list of other insurance companies who will be providing refunds for their customers:
- Farmers and 21st Century Insurance: 25% refund on April premiums
- GEICO: 15% off new and renewed policies between April 8 and October 7, 2020
- Liberty Mutual Insurance Company: 15% refunds on April and May’s monthly payments.
- Mercury Insurance: 15% refunds for April and May in the form of credits that can be used for all eligible accounts
- Progressive: 20% credits for both April and May
- State Farm: 25% credits for the period between March 20 and May 31, 2020.
- Travelers: 15% credit for April and May premiums.
- USAA:20% credit on two months of premiums.
If your insurance company has not yet issued a refund policy, we encourage you to contact them and discuss your options. Many providers will honor your request for a rate reduction or allow you to decrease your coverage while your car is parked (just remember to change it back before you start driving again)!
Additionally, many insurers are waiving late fees and offering payment help for anyone who is struggling with the financial impacts of COVID-19.
Car insurance is one of the only industries benefitting from the coronavirus pandemic. If you are filing a claim with a different type of insurance provider (IE: health insurance provider, home-owners policy, etc..) you may have a different experience.
Any time your insurer refuses to honor a valid claim, they may be acting in bad faith. If you are having a dispute with your insurance company, please contact The Ryland Law Firm.