Erie Insurance, based in Erie, Penn., will provide $200 million in dividends directly to personal and commercial auto insurance customers in the 12 states and the District of Columbia where the company does business. This relief represents about 30% of related auto insurance premiums over a two-month period, or 5% of customers’ annual premium.
This announcement is in addition to the $200 million in rate reductions the company announced earlier this month. Erie Insurance said in a company press release this is in response to the decline in miles driven due to the stay-at-home directives for COVID-19.
Erie’s announcement comes as many other insurers have previously announced refunds, discounts, dividends and credits totaling $8.1 billion as a result of decreased driving due to the coronavirus pandemic, according to the Insurance Information Institute. III estimates that this total will reach $10.5 billion as more auto insurers announce their offers, Insurance Journal previously reported.
Indeed, State Farm and Nationwide earlier this month joined the ranks of the top 10 auto insurers providing relief that already included Geico, Progressive, Allstate, USAA, Liberty Mutual, Farmers, Travelers and American Family. In addition, dozens of other insurers have also announced offers including Hanover, Chubb, Cincinnati Financial, Mercury and Amica. Most discounts are for personal lines auto customers, however a number of carriers are also targeting business customers, according to Insurance Journal’s previous report.
Erie plans to distribute checks in mid-May 2020, which will be mailed directly to customers with policies in force as of April 1, 2020, according to the release.
To further support local communities throughout its footprint, Erie is also granting nearly $2.5 million to agents and branch offices to boost their charitable work in local communities. The company also continues to offer flexible payment and billing options, coverage adjustments and other steps aimed at addressing specific customer and community needs.
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