Auto insurers issue refunds, suspend policy cancellations as citizens shelter in place

Several auto insurers have announced efforts to support customers during the COVID-19 pandemic.

"Given an unprecedented decline in driving, customers will receive a Shelter-in-Place Payback of more than $600 million over the next two months. This is fair because less driving means fewer accidents. We are also providing free identity protection for the rest of the year to all U.S residents who sign up, since our lives have become more digital," said said Tom Wilson, Allstate President and Chief Executive Officer in an April 6 press release.

"Allstate, Esurance and Encompass personal auto insurance customers will receive a Shelter-in-Place Payback. Most customers will receive 15% of their monthly premium in April and May, totaling more than $600 million," he added. "Customers will receive the money back through a credit to their bank account, credit card or Allstate account. The fastest way for customers to receive this payback is to utilize the Allstate Mobile app.  We are working with state insurance regulators to move forward expeditiously."

"As the COVID-19 pandemic continues to dramatically alter driving habits and create financial uncertainty for individuals and families across the country, American Family Insurance will return approximately $200 million to its auto insurance customers," Telisa Yancy, American Family chief operating officer, said in the company's April 6 press release. "The premium relief will come in the form of a one-time full payment of $50 per vehicle covered by an American Family personal auto policy. The typical American Family household with auto coverage has two vehicles, meaning the average relief check will be $100. American Family expects to complete the printing and distribution of all 2.3 million checks within 60 days, while diligently applying social distancing practices."

Geico announced on March 25 that the company would temporarily be suspending coverage cancellation due to non-payment and policy expiration, effective immediately and remaining in effect through April 30.

" In addition, GEICO is prepared to offer maximum flexibility, including special payment plans, to those who need it once normal billing operations are scheduled to resume, "said GEICO President and CEO Todd Combs. "This ongoing situation impacts everyone, and we want our policyholders to have some peace of mind knowing we'll be there when they need us most."

Farmers Insurance, in a March 27 press release, also made COVID-19 related changes to some policy regulations.

"With states enacting restaurant seating restrictions and stay-at-home orders to help deter the spread of the coronavirus (COVID-19), Farmers Insurance® announced today it is temporarily modifying its Farmers®-branded personal automobile and motorcycle insurance policies to provide applicable coverage for claims arising from the use of these vehicles for delivery of food, groceries, pharmacy and medical supplies, where they are not otherwise covered," said Keith Daly, President of Personal Lines for Farmers. "Customers will not receive an additional charge for this temporary additional coverage."

Travelers Insurance has instituted several new policies during the COVID-19 pandemic, including suspending cancellation and nonrenewal of coverage due to nonpayment through May 15, and adjusting the claim inspection process. The company has also pledged $5 million to COVID-19 relief efforts to assist families and communities.

SafeAuto announced on April 3 that they would be cutting fees across 16 of the 18 states they operate in, including Georgia.

"As of April 1st, SafeAuto has rolled out a no fee initiative. In order to assist policyholders across the states of California, Arizona, Colorado, Texas, Oklahoma, Kansas, Missouri, Illinois, Indiana, Tennessee, Louisiana, Mississippi, Alabama, Georgia, South Carolina, Virginia and Pennsylvania, SafeAuto has cut all monthly fees to help drivers stay covered," states a press release from the company. "Additionally, if customers in those states need to ‘pause’ their coverage for any reason, SafeAuto is making it easier for consumers to stop and restart their policy by waiving reinstatement fees."


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