Car Insurance and COVID-19

These are crazy times we are living in and the world seems to be changing by the day. Insurance is one of the sectors that is changing to help its customers and give them some relief from financial pressure. But what does it mean for you? Let us explore some frequently asked questions regarding COVID-19 and car insurance.

Car Insurance Covid-19

What are car insurers doing to help customers during COVID-19?

There are multiple things that many car insurers are doing to provide relief during this scary time. Be aware that every auto insurance company is doing their own relief package, so contact your insurer or agent to see if any of the following are available to you.

  • Moratorium on Cancellations
    • Many auto insurance companies are putting a moratorium on cancellations for non-payment at this time. If you miss a payment, many insurers are giving you more time to make that payment before they cancel your policy. This does not mean they are giving you free insurance by allowing you to miss a payment. You will need to make up for all those missed payments once the moratorium is lifted. It is important to pay your bill if you can, so you do not get left with a large bill at the end of the crisis.
  • Premium Rebates
    • Car insurers know that many people are not driving as much, and their cars are sitting idle. This is putting more money in their pockets since there are few fewer claims. Many insurers are offering rebates to their customers in the form of a premium credit. Depending on the company, this can be as much as 20 to 25 percent of your bill credited back to you for April and/or May. Other companies are opting to offer a flat credit (such as $50 per vehicle) instead. These premium rebates are being automatically credited to your account, so no action is needed by the customer.
  • Temporary Modification of Exclusions
    • Normally, food or medicine delivery drivers need a special endorsement on their personal auto policy to be covered. However, during this crisis, some carriers are modifying their policy exclusions to include coverage for food and/or medicine delivery drivers.
  • Special Service for First Responders and Medical Professionals
    • Some companies are offering special services to front-line professionals such as enhanced claims service, expedited towing and vehicle repairs, and deductible deferrals.

Are car insurance companies available to help if I have a claim?

Insurance was deemed essential by most states during this crisis, so car insurance companies and agents are available to help during this time. Be aware, you will probably get faster service through online portals and email rather than call centers. Many companies are experiencing high call volumes during this time. You can also contact your insurance agent to help you answer any questions you may have. 

Is there anything I can do to save money on my car insurance during COVID-19?

Save Money On Your Car Insurance

With many people out of work, everyone is looking to cut expenses. Here are a few ways you can save money on your car insurance during COVID-19.

  • Ask the insurance company to waive any late fees
    • If you have missed a payment, ask the insurance company to waive any fees or penalties. Most will oblige if you just ask and it is not a regular occurrence.
  • Change your payment plan
    • While this might not necessarily save you money, it can certainly help with a cashflow problem. If you normally pay in full or semi-annually, switch to monthly payments for a while to free up some cash.
  • Shop around
    • This is actually a great time to shop your insurance, especially if you think your credit might be taking a nosedive in the near future. Your insurance rates are highly tied to your credit rating. So, if you have great credit now, lock in that rate for 12 months! Hopefully, by the time your next renewal comes around, you will have had time to catch up on things. It doesn’t cost anything to shop your rate with an independent agent. It’s worth a look, even if you can get assurance that you have the lowest rate for your coverage.
  • Make sure you aren’t paying for things you don’t need
    • It’s easy to not realize what you are paying for on your car insurance. Do you have a AAA membership? You don’t need roadside assistance on your policy. Do you have extra cars? Think about taking off coverage that provides a rental car should you be in an accident. While it is not a good idea to lower your liability limits, there are other “extras” on your car insurance policy that can be removed if you don’t need them.

What do I do if I can’t pay my car insurance?

As discussed above, many carriers will not cancel your car insurance at this time. However, you will owe any missed payments once the moratorium is over. For instance, if your car insurance payment is $100 a month and you don’t pay April and May. There is a good chance, that you will have a $300 bill coming in June.

 

And don’t think, I will just cancel in June and get new insurance. You will still owe the company for the time that you were insured. If you don’t pay it, they will send it to collections. Also, if you have a lapse in insurance, you will increase your rate even more or even prevent you from getting coverage from certain carriers. (Many of your mainstream carriers require 6 months prior insurance before they will offer coverage.)

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We know this is scary time and everyone has many questions. We are here for you! Give us a call at 615-919-1009 anytime and we will navigate this together.

Disclaimer: Every carrier’s insurance policy is different. Please consult your auto insurance policy for specific coverages, exclusions, and limitations.