The COVID-19 pandemic has impacted every part of daily life, from sheltering in place to lost paychecks. While car insurance is no exception, the good news is that every major provider has pledged to help Americans in need like never before. To separate fact from fiction, we spoke with experts and analysts across the country to determine exactly how the coronavirus crisis will affect your car insurance.
Is my insurer going to give me money back? As of March 22nd, the number of cars on the road had fallen dramatically, about 20%, following the declaration of a national emergency in the U.S. Many of the largest auto insurance companies recently announced they will be responding to the lowered risk of auto claims with premium rebates for customers. State regulators are also putting pressure on all insurers to step up to support consumers with measures like extended grace periods, so if your insurer hasn’t yet responded with meaningful actions, you can routinely check its website to catch updates or reach out directly. Should I change my auto coverage because of COVID-19? While you can definitely reach out to your insurance company to see if your lowered mileage could mean a discounted rate, keep the following in mind: Don’t cancel coverage you’ll need in the future. Canceling your car insurance, even if it’s only for a limited period of time, can have several negative impacts:
How can I lower my monthly payments? Increase your deductible Your deductible is the amount of money you agree to pay out of pocket before the insurance coverage will kick in. Increasing your deductible helps lower your premium because you’ll be on the hook for a larger part of any potential losses, but that also means saving on your bill now is something you’ll need to weigh with your ability to take that additional risk. Reduce your liability coverage limits Lowering your liability coverage limits can also help you save on insurance, but it will likely make a smaller dent than changing your deductible. Your car insurance coverage will have both bodily injury and property damage liability, or the maximum amount your insurance company will cover, if you cause damage to someone else or their property. Switch to a usage-based plan If you’re driving fewer miles than usual, you may want to consider a usage-based car insurance plan. While traditional car insurance is priced using factors like your age and claims history, usage-based insurance relies on driving data (usually gathered through an app on your phone) to determine how much you pay for coverage. Many larger insurers are starting to offer usage-based options. This option would be best for users who are likely to benefit from a usage-based policy for the long-term, though. Switching insurers too often can signal that you’re not a loyal customer, which can mean you may be quoted higher rates from even other insurers in the future. Will my future auto insurance premiums be affected by COVID-19? Most drivers are well aware that an increase in claims can spike car insurance rates, but the economy as a whole is also closely tied to an insurance company’s business. Will auto insurance claims be affected by COVID-19? With social distancing measures in place across the country, insurers are making sure their employees and customers stay safe by keeping the claims process digital. This may be a big change from a typically hands-on process or you may not see a change at all. What if I can’t afford my auto insurance payments because of COVID-19? If you are struggling with your car insurance premiums, you should contact your insurer. Many are addressing the COVID-19 pandemic with programs to assist policyholders. For more information, please contact Theodore & Associates today.
1 Comment
7/17/2020 09:23:21 am
You have mentioned huge practical facts, this something what I was looking for. Contacting professionals to understand legal terms is always the best idea.
Reply
Leave a Reply. |
Archives
June 2020
Categories
All
|