Insurance companies reduce premiums amid coronavirus outbreak
Several major insurance companies are reducing premiums due to fewer claims amid social distancing measures put in place during the coronavirus pandemic.
State Farm announced that a dividend of up to $2 billion will go to its auto insurance customers, who will receive a credit of about 25 percent of their premium for the time period of March 20 through May 31, though exact percentages will vary by state.
The insurance giant noted it is receiving fewer claims as many Americans have begun working remotely and forgoing their commutes.
“We see from our claims activity people are driving less,” State Farm president and chief executive Michael L. Tipsord said in a statement. “This dividend is one of the ways we’re working to help our customers during this unprecedented situation.”
USAA, one of the country’s largest property-casualty insurers, announced Wednesday it will be giving back $520 million to its members, noting that every member with an auto insurance policy as of March 31 will receive a 20 percent credit on two months of premiums in the coming weeks.
“We understand the impact this pandemic is having on our country, and especially our military community and their families, many of whom also are working on the front lines of the crisis. Returning premiums provides timely help for our members,” USAA chief executive Wayne Peacock said in a statement.
Other insurers, such as Liberty Mutual and Allstate, announced this week they are issuing a 15 percent refund on premiums. Geico announced Tuesday that it would return 15 percent credit on policy renewals between now and October.