U.S. auto insurers will rebate more than $10 billion to their customers nationwide in the coming months. That’s according to an estimate released April 11 by the Insurance Information Institute (Triple-I).
The Triple-I says 14 major U.S. auto insurers have announced premium refunds, discounts, dividends, and credits. The reason? Policyholders are driving less and making fewer claims during the COVID-19 crisis. CNN Business reports that the amounts being returned range from about 15% to 25% of premiums. The refunds range over periods of one to six months.
Ten Big Insurers Offering Refunds and Rebates
Triple-I made a list of the 10 most notable insurers and their auto insurance refund measures:
- Allstate is giving its customers 15% rebates on premiums over April and May through its “Shelter-In-Place Paybacks” program.
- American Family Insurance is providing a one-time, $50 payment for each vehicle insured under a personal auto insurance policy.
- Farmers and 21st Century policyholders will receive a 25% reduction in their April premiums.
- The Hanover Insurance Group will return 15% of April and May auto premiums.
- Liberty Mutual and Safeco are providing a 15% refund for two months of policyholders’ personal auto premiums.
- MetLife Auto & Home customers will receive 15% credit for April and May based on their monthly premiums.
- Nationwide is giving a one-time premium refund of $50 per policy for personal auto policies active as of March 31, 2020.
- State Farm has revealed an up to $2 billion dividend that will go to its auto insurance customers; it will appear as a credit on their policies. On average, customers can expect to receive a credit of about 25% of premiums for the period March 20 through May 31. The exact percentages will vary by state.
- The Travelers Companies is giving 15% credit to auto insurance customers on their April and May premiums.
- USAA says its policyholders will receive a 20% credit on two months of premiums in the coming weeks. The insurer is returning $520 million to its members.
“These are challenging financial times for millions of Americans, and the country’s auto insurers are making it easier for their customers to get through this extraordinary time in U.S. history,” Triple-I CEO Sean Kevelighan stated.
The Triple-I estimates the typical U.S. auto insurance customer spent $1,113 in 2019 to cover a single private-passenger vehicle.
Other Discounts and Rebates
Separately, an NBC news report found discounts among a few other companies:
- AAA: 20%
- Progressive: 20%
- Esurance: 15%
Meanwhile, Consumer Reports listed a few other rebates:
- Amica says its customers will see a 20% credit on their auto premiums for April and May.
- GEICO is offering a 15% credit to auto and motorcycle policyholders as their policies come up for renewal.
- Auto-Owners Insurance told Consumer Reports that it plans to announce a premium refund program in the near future.
- NJM has announced it will refund 15%of the equivalent of three months of premium payments to policyholders.
- Chubb says that when its policyholders renew their policies, they will receive a credit reflecting a 35% premium reduction for the months of April and May. There may be additional discounts for subsequent months, as the situation warrants.
- Mercury says it plans to return 15% of monthly auto insurance premiums to customers in April and May.
Stay on Top of Your Coverage
Finally, Consumer Reports offered a few recommendations, regardless of your insurance:
- Review your coverage. You may discover you need more coverage or less coverage depending on your specific situation. Remember to change your policy back if you start driving more miles once the crisis is over.
- Keep your premiums from piling up. If you’ve deferred payments, prepare for slightly higher bills in the future. Some insurers are willing to spread out back payments over multiple months to make it easier for policyholders to make them up. But consumers should still make a plan.
- Be aware the claims process may change. If you do have to file a claim, David A. Sampson, president and CEO of the American Property Casualty Insurance Association, an insurance industry trade group, told Consumer Reports that “auto insurers are prepared to be as flexible as possible within the terms of the policy”. This includes using video inspections to assess claims. Some insurers may also be more forgiving of delays when repair shops are closed or operating at reduced capacity.
- Contact your agent. At Farris Insurance, we’re here for you in this time of crisis and beyond. Many insurance agencies are looking to do right by their customers. Your first step should be a phone call.