UPDATED: Emergency relief offered by insurers
Since the pandemic began, the driving habits of many people have changed.
In an effort to respond, insurance companies moved quickly to provide premium reductions and additional flexibility to help people get through this difficult period. But not all carriers are offering the same relief. The Insurance Bureau of Canada said thousands of Canadians have already had their premiums reduced, but they suggest customers reach out to their broker or insurance company to see whether they qualify.
“As it relates to savings on auto insurance premiums, savings will vary depending on individual driving habits,” IBC said in a statement.
They estimate the total amount of relief on the way could reach $600 million, according to the Financial Post. IBC believes unique coverage options offered by insurance make it difficult to offer blanket, baseline solutions for clients having financial difficulties.
Canadian Underwriter approached individual companies to ask how they might offer emergency relief. Here are what some of the carriers are doing for personal home and auto insurance policies:
Aviva is offering a “Stay Home” endorsement which can reduce auto premiums by up to 75 per cent for those who have stopped driving entirely. It’s one of a series of new relief options set out by the carrier, in addition to previously-announced measures.
For those customers who have to drive during the pandemic — but still less than before — could receive savings of up to 15 per cent. Those using personal vehicles to deliver food and medical supplies will also be covered with no change to premium or impact on coverage. This does not apply to delivery drivers using third-party apps.
When it comes to renewals, premiums will be frozen, meaning customers will have the same auto premiums for their next 12-month policy term. This applies to renewals mailed on or after April 17 or upon regulatory approval in their province, whichever is later. Those who have had a significant loss or traffic violation, however, may not be eligible.
Aviva is continuing to offer deferred payments for up to 90 days without penalty or additional fees when customers face financial stress due to COVID-19. Also, NSF fees are being waived for those unable to make payments. Coverage will still continue for those clients.
Payment relief is on the way for customers of Economical and its family of brands. The company is offering to explore flexible payment options. Personal insurance customers who are impacted financially by COVID-19 should speak with their broker.
Such options include: payment deferrals and waived NSF fees, payment plans adjustments to update the method or frequency of payments, reduction of auto insurance premiums by limiting coverage, or reducing the number of kilometres. There is also no impact on premiums if customers temporarily use their cars or homes differently. These options are available for the next 90 days but could change based upon ongoing assessments.
Gore Mutual Insurance Company
Gore Mutual is offering personal auto policyholders a one-time payment equivalent to 20 per cent of three months of premiums paid. Clients who had policies as of April 8 will receive payment by cheque in the mail. No action is required from customers.
Personal property clients who are now working from home will get personal liability and business property coverage for up to $5,000 on their existing policies. Gore won’t charge additional premiums for the coverage, which is in effect until July 31.
The carrier will assess the impact of the pandemic and explore new flexible payment options on a case-by-case basis, including no penalty for payment deferral.
Customers who park and safely store their vehicles will get an average of 75 per cent in rate reductions from Intact Financial Corporation. Those whose driving habits have changed will get a 15 per cent reduction on their premiums for three months.
The insurer made these changes on top of previously announced measures to provide financial relief to customers during the COVID-19 pandemic. Other relief measures include: waiving of missed payment fees, flexible payment options, and flexibility for those using their vehicles and homes for different purposes such as working from home.
The measures are in place up until June 30. Customers can either go through their broker or fill out an online form to update their personal driving habits.
Pafco/Pembridge Insurance Company
Pafco Insurance announced an automatic “Stay at Home Payment” to help its personal auto insurance customers. It will be automatically available to policyholders who had an active policy as of April 8. The cheque – in the amount of about 25 per cent of a customer’s monthly auto insurance premium, will be sent in May. It applies toany personal vehicles, including Medium/Heavy trucks. Recreational vehicles such as motorcycles and snowmobiles do not qualify.
The company will also discuss payment deferrals and waive NSF fees. Customers should contact their broker.
Customers of RSA Canada will receive a break on their insurance premiums, but how much will depend on their needs and situation.
The carrier has put a number of measures in place until June 30 and will review the plan as the pandemic develops. Those driving or commuting less – or aren’t using their vehicles at all – are asked to call their broker to make auto coverage changes.
If customers need support or are struggling to make payments, flexible options and payment deferrals are being made available. Again, they should contact their broker. Non-sufficient funds fees for personal policies after April 1 will be waived by the insurer. However, RSA warns that banks may make separate charges, and customers should speak with their bank for more information.
Personal auto clients who are temporarily using their vehicle for delivery – whether they are an employee of a restaurant, grocery store, pharmacy, or even with a food delivery service app — coverage will be available for all policies. There will be no change in premiums.
When it comes to home policies, coverages in place will not be impacted when working from home when directed to do so by their employer due to the pandemic.
A Stay-at-Home Auto Premium Credit Program will see Travelers Canada personal auto clients get a 25 per cent premium reduction for one month.
Customers’ accounts will be automatically credited the amount, starting in May. Travelers will keep an eye on its program as it gets more information about the COVID-19 pandemic’s impact on the driving environment and auto claims.
The company is also extending auto coverage for Canadian customers who are temporarily using their personal vehicles for food, grocery, pharmacy, and medical supply deliveries.
This announcement follows other relief measures such as the suspension of cancellation and non-renewal coverage because of non-payment and not charging NSF fees through to May 15 to give policyholders more time to pay their premiums without having their policy cancelled.
Wawanesa Mutual Insurance Company
Wawanesa clients who aren’t commuting to work anymore are being asked to contact their brokers to adjust their policies for premium relief during the pandemic.
Those who are still using their vehicles for groceries and medical appointments should change their coverage to reflect their change in vehicle usage. Clients who have completely parked their vehicles can also contact their brokers to talk about options to reduce coverage and pay less per month. Wawanesa savings could be as high as 75 per cent or $80 per month for each vehicle not being used.
If a client wants to deliver food and the like due to a change in their livelihood or business because of the pandemic, the company is allowing policyholders to change their vehicle usage to do so.
Clients working from home can see $5,000 in coverage to protect business property that may not be insured elsewhere.
Wawanesa is also waiving NSF fees until at least May 25, offering help for payment deferrals, flexible payment options, and not cancelling policies for non-payment.
If customers have changed their driving behaviour or are no longer using their vehicles, they should speak with their broker about ways to reduce insurance premiums. Customers may also qualify for a one-month payment deferral. Zenith is also waiving NSF fees until May 31, 2020.
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