At MR Civil Justice, we are seldom in agreement with big insurance companies. Nevertheless, we were pleased to hear about several insurance providers paying it forward in the wake of the coronavirus pandemic. Due to decreasing car accidents and unprecedented savings, many car insurance companies are issuing refunds, discounts, and credits to policyholders.
Allstate and American Family Insurance Lead the Charge
On Monday, April 6, 2020, Allstate and American Family Insurance 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.
As Allstate’s CEO explains:
“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.
Similarly, American Family Insurance will give policyholders $50 per car they have insured with the company, for a total refund of about $200 million.
Other Insurers Follow Suit
By April 10, a collection of 10 major insurers had issued auto insurance refund programs. Some policyholders will receive checks in the mail, some will get discounts on their next premiums, and others will find credit on their accounts.
In addition to Allstate and American Family Insurance, the following providers will issue kickbacks for their customers:
- Farmers and 21st Century Insurance will provide a 25% refund on April premiums
- GEICO will take 15% off new and renewed policies between April 8 and October 7, 2020
- Liberty Mutual Insurance will be issuing 15% refunds on April and May’s monthly payments for over $250 in customer returns.
- Mercury Insurance is offering 15% refunds for April and May in the form of credits that can be used for all eligible accounts
- Progressive will give customers 20% credits for both April and May
- State Farm will give 25% refunds in company credit for the period between March 20 and May 31, 2020
- Travelers will automatically credit 15% of April and May premiums to customer accounts
- USAA will give policyholders a 20% credit on two months of premiums for $520 million in customer returns
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.
Honoring Insurance Claims
We are happy to see insurance companies acting fairly and honestly and putting policyholders above excessive profits. That being said, we’ve worked with insurers long enough to know this isn’t always the case.
Further, car insurance is one of the only industries benefitting from the coronavirus pandemic. If you are filing a claim with a business insurance policy, you might have a very different experience.
Any time your insurer refuses to honor a valid claim, they may be acting in bad faith. If you need help handling an insurance dispute, please do not hesitate to contact MR Civil Justice for a free consultation.
To discuss your insurance policy or claim with our experienced attorneys, please call us at (214) 307-8387 today.
We are still available online and by phone. In the meantime, stay safe, stay healthy, and follow CDC guidelines. We hope to be on the other side of this pandemic and offer in-person services again soon.