COVID-19 drives down auto premiums but may improve profits - LeadCloud News
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COVID-19 drives down auto premiums but may improve profits
03 September 2020

COVID-19 drives down auto premiums but may improve profits

For personal auto, the premium drop could come in the form of refunds or dividends to policyholders, as well as premium discounts upon renewal. Most personal auto carriers returned between 10% and 25% in premiums to customers during March, April and May to account for the vastly lower number of miles being driven, Reuters reported. However, these credits are likely short-term in nature and may only impact premiums in quarters two and three of 2020. Premium volume may be restored once carriers complete their COVID-related returns and driving starts to return to normal levels.

If, on the other hand, insurers offer premium discounts going forward on new and renewal policies due to more systemic changes in driving patterns, that could have a longer-term impact on personal auto premium volume. Indeed, our actuarial team anticipates single-digit rate decreases for the next several quarters, which would keep personal auto premiums well below pre-pandemic levels until 2023.

Learn more here - https://www.propertycasualty360.com/2020/08/31/covid-19-drives-down-auto-premiums-but-may-improve-profits/

 

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