Car insurance and coronavirus: Everything you need to know

The COVID-19 pandemic led many car insurance companies to issue refunds or payment relief to customers, but as of 2022, companies are no longer offering these breaks.

Kara McGinleyAndrew Hurst

By

Kara McGinley

Kara McGinley

Editor & Licensed Home Insurance Expert

Kara McGinley is an editor and licensed home insurance expert at Policygenius, where she writes about homeowners and renters insurance. As a journalist and as an insurance expert, her work and insights have been featured in Kiplinger, Lifehacker, MSN, WRAL.com, and elsewhere.

&Andrew Hurst

Andrew Hurst

Senior Editor & Licensed Auto Insurance Expert

Andrew Hurst is a senior editor and a licensed auto insurance expert at Policygenius. His work has also been featured in The New York Times, The Wall Street Journal, Forbes, USA Today, NPR, Mic, Insurance Business Magazine, ValuePenguin, and Property Casualty 360.

Updated|4 min read

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During the early months of COVID-19, some car insurance companies issued refunds and even allowed customers to pause their insurance payments. This was due to a drop off in commuters, mass layoffs that affected lots of types of workers, and uncertainty about the new virus.

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While COVID-19 is still around, car insurance companies are no longer offering virus-related rebates or letting you pause car insurance payments. Though companies don’t offer COVID-19 refunds anymore, you might be able to get a retroactive refund if you never received a rebate from your provider in 2020.

Key Takeaways

  • While your rates may have changed during the pandemic, chances are your company no longer offers refunds or allows late or missed payments due to COVID-19.

  • Even if you can’t pay your insurance due to COVID-19, you can’t pause your car insurance coverage without canceling it entirely.

  • Companies aren’t offering COVID-19 refunds anymore, but if you never got a discount but were eligible, let your insurance provider know.

  • Even though you may have shifted to a work-from-home schedule since the pandemic, you'll still have to keep your car insurance in-force if you plan to drive.

Are car insurance companies giving refunds due to COVID-19?

As of 2022, car insurance companies are no longer giving refunds due to COVID-19. Most companies stopped issuing refunds and waiving late fees to drivers in the later part of 2020.

While companies handled changes caused by the coronavirus pandemic differently, most car insurance companies offered rebates on your insurance policy’s payments or flat refunds to drivers. Companies also lowered rates for new customers during early 2020.

Rates have climbed back to pre-pandemic levels (or higher) and car insurance companies are no longer waiving late fees or excusing missed payments.

If you were eligible for a discount or rebate in 2020 from your auto insurance company but never received any paybacks or refunds, it might be worth it to contact your insurance provider to see if you can still get that discount.

What if you can’t pay for car insurance because of COVID-19?

If you can no longer pay for your car insurance because of COVID-19, you won’t be able to pause your coverage without canceling it. Canceling your coverage outright will make it illegal for you to drive in most states, and will lead to higher rates in the future.

Instead of canceling your policy, you could lower your coverage levels, switch to  usage-based insurance, or consider a per-mile insurance plan if you don’t drive very much.

→ Read more about pausing and canceling your insurance

Which car insurance companies offered COVID-19 refunds?

While you can’t get COVID-19 refunds anymore, most major auto insurance companies offered refunds and other perks to customers due to the stay-at-home orders across the country.

This table references policies from 2020 — these are no longer in effect.

  • Allstate: 15% money back based on premiums in April and May. Extended coverage to policyholders using their personal vehicles to deliver food, medicine, and other emergency goods.

  • Amica: 0% credit on April and May premiums. No policy cancellations or non-renewals until June.

  • Chubb: 35% premium reduction for the months of April and May.

  • CSAA: 20% refund for two months of auto insurance premiums. Paused non-payment policy cancellations until May 31.

  • Farmers Insurance: 25% premium reduction in April. Paused non-payment policy cancellations until May 1.

  • GEICO: 15% credit to eligible policyholders as their policy comes up for renewal and paused non-payment policy cancellations until at least April 30.

  • Liberty Mutual: 15% refund on two months of auto premiums. Stopped late fee charges and non-payment policy cancellations.

  • Mercury Insurance: 15% off monthly auto insurance premiums in April and May.

  • Nationwide: $50 one-time premium refund per policy.

  • State Farm: On average, most customers received a 25% policy credit.

  • Travelers: 15% credit on April and May premiums

  • USAA: 20% credit on two months of premiums for eligible policyholders, plus no policy cancellations or late fees through June, 17 2020.

How do you contact your company about a missed COVID-19 refund?

Insurance companies are no longer offering refunds related to the COVID-19 pandemic. After fall 2020, most companies stopped offering refunds. After the vaccine became widely available, all refunds stopped entirely.

The only way you might be able to get a COVID-19 insurance discount is if you were eligible in 2020 but never received a payout. For instance, if your provider gave all policyholders a rebate and you were missed, it might be worth contacting your insurer about now.

You can contact your insurance provider over the phone or by using their 24/7 help line. You might be able to raise the issue of a missed discount via email or live chat on your insurance company's website.

Should I reduce my car insurance if COVID-19 changed how much I drive?

It’s not uncommon for companies to have switched to a work-from-home schedule because of the COVID-19 pandemic. If you’re not commuting as much as you were before the pandemic, you might be tempted to get rid of your insurance coverage to get cheaper insurance.

As long as you plan to drive, you can’t cancel your auto insurance. Driving without car insurance in nearly every state is illegal and can result in fines, a suspended license, and more if you’re caught. Plus, you’d have to pay for any damage you caused in a crash yourself.

If you’re considering getting rid of your policy’s comprehensive and collision coverages, make sure that you would be able to pay for your car’s damage yourself if it were damaged. 

Even without a commute, your car could still be damaged by the weather, an animal, or stolen — and without full-coverage insurance protection, you wouldn’t be covered.

You should inform your current car insurance provider that you’re driving fewer miles, you may qualify for a low-mileage discount thanks to your new schedule. It might also be a good idea to consider switching from a conventional to a per-mile car insurance plan. If you rarely drive, what you pay for insurance coverage will be less with per-mile insurance than a regular policy. 

If you think you’re paying too much for car insurance, be sure to shop around and compare rates from multiple companies. You may be able to find a company that will match your current coverage for much more affordable rates.

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Do car insurance companies still offer COVID relief?

While many companies offered discounts, freezes on late payment fees, and paused policy terminations for non-payments in the early days of the pandemic, insurance companies no longer offer these types of relief because of COVID-19.

Can you pause your insurance if you can’t pay because of COVID-19?

You can’t pause your car insurance without canceling your policy. But it’s a bad idea to cancel your policy while you still own a car. It’s illegal in nearly every state to drive without insurance, and your rates will increase in the future when you get coverage again.

Should you drop car insurance if you don’t drive anymore because of COVID?

Instead of dropping the protection that comes with car insurance after shifting to a work-from-home schedule, consider instead changing to per-mile car insurance or checking other companies in your area for cheaper rates.