Will COVID-19 Impact Car Insurance Rates?
Due to COVID-19-related lockdowns, many of us Americans are driving less. It’s normal to wonder if and how the pandemic will influence your insurance premiums in the days ahead. Here’s an overview of where insurance carriers stand right now, as well as some answers to questions you might currently have about your auto policy.
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A petition for lowered premiums
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Some organizations are starting to pressure insurance companies to refund or credit premiums during the COVID-19-related lockdowns, as Forbes reports. At the state level, the Consumer Federation of California Education Foundation filed a petition with the California Insurance Commissioner. At the national level, the Center for Economic Justice and the Consumer Federation of America are pressuring state insurance departments to encourage auto insurers to provide financial relief to policyholders.
However, some auto insurance companies have already voiced the challenge of offering short-term mileage discounts, as Ariana Gibson with Clearcover confirms.
Potential policy discounts and whether you should switch to a new one
According to Forbes, select auto insurance companies are offering lower premiums if you’re driving less due to the pandemic. It really depends on whether or not your carrier factors in annual mileage when calculating your monthly insurance rate.
If you know that you won’t be driving much in the long-term, you might consider switching to a pay-per-mile insurance policy available from carriers like SmartMiles from Nationwide or Milewise from Allstate.
If you anticipate that you’ll be driving more regularly soon, Forbes recommends keeping your current auto policy. This will cover your vehicle in the event of any accidents, break-ins, or weather-related damages.
Contact your insurance company
Photo: Eneida Nieves
Per Forbes, it’s best to contact your insurance company if you’re not sure that they’re providing discounts during this time — or if you’re struggling to make monthly payments due to unemployment or financial hardship. Some insurance carriers are offering mileage-related discounts, while others are offering extended grace periods and other financial relief to policyholders.
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Whitney Russell resides in Dayton, though her spirit can be found beach-bumming in Puerto Rico (the land of her half-Puerto Rican heritage). When not crafting car-related content, she can be found chasing after the most amazing toddler in the world, watching her “beaver” of a husband build amazing woodworking projects, hanging out with two crazy dogs, and visiting family and friends. She also enjoys traveling, crafting, and binge-watching period dramas when time allows. See more articles by Whitney.