Honestly, I am a progressive customer in Florida with full coverage and my car insurance is $100 per month… $20 is not something I will even notice. They could use that money better
This whole idea is kind of stupid. I have made far more claims over the years from incidents that happened when my car was parked then from accidents that happened while driving.
David, that is great news that you’re in a position that $20 is not real meaningful. Even better, you’re in a position that you can donate the $20 to a charity of your choice.
If your premiums are taken from your bank account, your insurance company will likely use the same account information to provide you with this credit.
But the insurance haters like Bob Hunter of the Consumer Federation of America are dead set against insurers keeping premiums where they are. They are demanding premium givebacks, not realizing the marketplace will let this happen organically anyway. Lower loss costs are going to lead to lower premiums automatically anyway. No need for government intervention.
The lower loss costs would not necessarily lead to lower premiums in this case. Ratemaking is prospective in nature and you are trying to estimate what the costs are going to be for the future policy period. Since this type of incident is (hopefully) not expected for the future, adjustments will likely be made to the rate indications to account for the effect of COVID-19.
This is not a discount! These polices all have rating exposures factors against rates. One of those factors is miles driven annually. Since driving to/from work is not happening, that means the exposure factor is reduced. So that means what is happening is akin to a premium audit.
I can’t wait for the client who has knee surgery and can’t drive for 6 weeks to call and want a rebate.I know, the agent could put the car in storage or reduce coverage / usage and then maybe remember to reinstate the changes later. How many times do you want to touch a policy? I am stomping on my foot, let me know when it stops hurting you….
I read once, that statistically, most accidents occur within 1-2 miles of one’s home. So, since everyone can still go to the store, and run other errands, there will still be some accidents. Also, I don’t think thieves are obeying “shelter in place” requirements. Of course, it is hail season, but wait, due to COVID-19 the storms have agreed not to cause any damage over the next 2 months.
In CA annual miles is a primary rating factor. Many of the carriers use a minimum of 10,000 miles for vehicles used in commuting to/from work. Cutting that back to a much lower usage for 2 months could amount to some significant premium reductions on some accounts. However, it should be done on the basis of the term of the shelter in place.. so if this continues through May or June, the credit continues. Example – for a number of years my commute was 4 miles one way, then it was 50 miles for a period of time. Huge difference in my annual mileage so would have been a major impact had the current rating rules been in effect during that time. Right now, mileage might be closer to 50 miles a month.
I mean, I guess I’m not surprised that there’s some crossover between insurance people and furrie people. But at the same time, kind of just a little? Like I’m suddenly fascinated in a totally non-judgmental way. Do you have to hide your fursona from the office? Do you wear a tail to business meetings? Do you think anyone you work with knows what yiffing is? I’m just curious. I work with guys who are still in the closet at the office, I can’t imagine if we had a furrie.
My small one-state company has been adjusting driver classes from “drive to work” to “pleasure use”; laying vehicles up on Comp only; reducing WC payrolls; reducing GL premiums as exposures have declined, etc. While I prefer what we are doing as actuarially sound, we are going to have to follow suit with some form of discount. Our state’s Insurance Department hasn’t indicated what justification for filings, while other states’ are increasingly requiring this discount.
Did I miss something in the article? Honestly, did I miss the part where the companies are clawing back commissions from return of premiums? Several of my carriers offer $ back on longevity/safe driving history, and it comes with a commission clawback. Is that our fate here?
Just paid my insurance due May 15 and did not receive the 20% discount. Progressive is not honoring their promise of the 20% covid discount. Typical for Progressive
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Good point John but I don’t know of many incidents where people were hurt or killed from a parked car.
David, that is great news that you’re in a position that $20 is not real meaningful. Even better, you’re in a position that you can donate the $20 to a charity of your choice.
I have my insurance bill taken from my bank, are you going to adjust the payment from my account?
If your premiums are taken from your bank account, your insurance company will likely use the same account information to provide you with this credit.
But the insurance haters like Bob Hunter of the Consumer Federation of America are dead set against insurers keeping premiums where they are. They are demanding premium givebacks, not realizing the marketplace will let this happen organically anyway. Lower loss costs are going to lead to lower premiums automatically anyway. No need for government intervention.
Mark you are correct and by waiting for actual data the reductions will me more accurate. But once one company does it then all must follow.
The lower loss costs would not necessarily lead to lower premiums in this case. Ratemaking is prospective in nature and you are trying to estimate what the costs are going to be for the future policy period. Since this type of incident is (hopefully) not expected for the future, adjustments will likely be made to the rate indications to account for the effect of COVID-19.
This is not a discount! These polices all have rating exposures factors against rates. One of those factors is miles driven annually. Since driving to/from work is not happening, that means the exposure factor is reduced. So that means what is happening is akin to a premium audit.
I can’t wait for the client who has knee surgery and can’t drive for 6 weeks to call and want a rebate.I know, the agent could put the car in storage or reduce coverage / usage and then maybe remember to reinstate the changes later. How many times do you want to touch a policy? I am stomping on my foot, let me know when it stops hurting you….
Unless you are referring to vandalism another (moving) auto would likely be involved in hitting a parked car.
I read once, that statistically, most accidents occur within 1-2 miles of one’s home. So, since everyone can still go to the store, and run other errands, there will still be some accidents. Also, I don’t think thieves are obeying “shelter in place” requirements. Of course, it is hail season, but wait, due to COVID-19 the storms have agreed not to cause any damage over the next 2 months.
In CA annual miles is a primary rating factor. Many of the carriers use a minimum of 10,000 miles for vehicles used in commuting to/from work. Cutting that back to a much lower usage for 2 months could amount to some significant premium reductions on some accounts. However, it should be done on the basis of the term of the shelter in place.. so if this continues through May or June, the credit continues. Example – for a number of years my commute was 4 miles one way, then it was 50 miles for a period of time. Huge difference in my annual mileage so would have been a major impact had the current rating rules been in effect during that time. Right now, mileage might be closer to 50 miles a month.
I mean, I guess I’m not surprised that there’s some crossover between insurance people and furrie people. But at the same time, kind of just a little? Like I’m suddenly fascinated in a totally non-judgmental way. Do you have to hide your fursona from the office? Do you wear a tail to business meetings? Do you think anyone you work with knows what yiffing is? I’m just curious. I work with guys who are still in the closet at the office, I can’t imagine if we had a furrie.
My small one-state company has been adjusting driver classes from “drive to work” to “pleasure use”; laying vehicles up on Comp only; reducing WC payrolls; reducing GL premiums as exposures have declined, etc. While I prefer what we are doing as actuarially sound, we are going to have to follow suit with some form of discount. Our state’s Insurance Department hasn’t indicated what justification for filings, while other states’ are increasingly requiring this discount.
Did I miss something in the article? Honestly, did I miss the part where the companies are clawing back commissions from return of premiums? Several of my carriers offer $ back on longevity/safe driving history, and it comes with a commission clawback. Is that our fate here?
Just paid my insurance due May 15 and did not receive the 20% discount. Progressive is not honoring their promise of the 20% covid discount. Typical for Progressive