Car insurance and coronavirus: What you need to know

The coronavirus pandemic may affect your car insurance premiums if you make changes to your policy or if your insurer lowers your rates or pays you back a percentage of your premiums. The way you communicate with your insurer may also change.

Kara McGinley

Kara McGinley

Published May 18, 2020

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KEY TAKEAWAYS

  • Your car insurance premiums may change during the coronavirus outbreak. For example, your insurance company might lower your rates or offer paybacks on a percentage of your monthly premiums

  • Even though you will be traveling less, you should keep your car insurance policy in-force. All but two states require car insurance to legally drive, so if you cancel your auto policy you won’t legally be allowed to drive

  • You should try to contact your insurance company over the phone, online, or through a mobile app instead of in-person

  • If you have full coverage car insurance, you might be tempted to reduce the amount of coverage you have. However, you should consider how much you could afford to pay out of pocket if you were to drop some coverage and then get in a car accident

Car insurance is essential financial protection in case you get into a car accident that leaves you liable for damage, or in case your car gets stolen or damaged by another named peril. As long as your insurance is active and you are making your premium payments on time you will continue to be protected.

However, given the global coronavirus pandemic and the fact that cities and states are requiring mandatory curfews and business closings, you might be wondering how your car insurance will be affected, or even if you should drop some of your coverage in order to save on your premiums. That said, if you plan on driving at all you should keep your car insurance as is — most states require car insurance to legally drive on public roads.

Many people are concerned about how the coronavirus outbreak will affect their insurance policies, whether it be life insurance, travel insurance, or health insurance. Your car insurance may be affected, but it will really depend on your insurance company. For example, some insurers are beginning to offer a percentage of paybacks on monthly premiums. What will also likely be affected during the coronavirus pandemic is how you interact with your insurance company. For example, meetings with a claims adjuster may be virtual instead of in person, or there may be longer wait times to speak to agents from your car insurance company.

In this article:

How will my car insurance change during the coronavirus outbreak?

For the most part, your car insurance is not going to change during the COVID-19 pandemic unless your insurance company offers you discounts or paybacks on your premiums, or if you decide to make changes to your policy. Even though you will likely travel less during this time, you should still probably keep your car insurance policy as-is. If you’re not planning on using your car for the foreseeable future, you still shouldn’t drop any of your coverage — you may need to drive in the event of an emergency, and you don’t want to be left unprotected. That said, as more and more businesses close or work remotely, how you communicate with your insurance company may change slightly.

Due changes required by the risks of COVID-19, companies are adapting quickly, but you may have increased wait times when communicating with representatives. Offices might also close or change their hours, for example, you may not be able to walk into your local State Farm office to meet with your insurance agent like you normally would.

How to contact your car insurance company during the coronavirus outbreak

In order to keep customers and employees safe during this uncertain time, many businesses are enforcing new work from home policies (when feasible), and this includes the insurance industry. Most insurers are providing up-to-date information for their customers via email or their website, so you should keep an eye out for potential updates from your insurance company.

There are a few reasons you might need to contact your insurance company:

  • To add someone to or remove someone from your policy
  • Increase or decrease coverage limits or amounts
  • If you move out-of-state
  • Multi-policy and discount questions

Many of these updates or issues can be resolved online, or even through a smartphone app. Depending on your insurance company, if you need to communicate with your insurance agent you should consider these options first instead of visiting a local office, or if your local office has closed down:

  • Calling your insurance company over the phone. Regardless of the pandemic, most insurance companies also have 24/7 emergency help hotlines for you to call.
  • Through your insurance company’s website or mobile app
  • Email or live chat option on your insurer’s website

How are car insurance companies responding to the coronavirus outbreak?

How car insurance companies are handling changes caused by the coronavirus outbreak will vary from company to company — not every insurance company handles a global pandemic in the same way. But based on what has been gathered from some of our partnering companies, like AIG, Travelers, and Plymouth Rock, you should look for the following changed factors:

  • Paybacks on a percentage of your monthly premiums
  • A flat rate refund for policyholders (for example, Nationwide is offering a $50 refund for certain auto policyholders)
  • Updated signature requirements for auto policies
  • Billing support for customers affected by the coronavirus
  • Temporary payment extensions
  • Decreased insurance rates
  • Holds on policy terminations due to nonpayment
  • Text message only claims handling (text photographs of vehicle damage, communicate with a claims adjuster via text)

You should contact your insurance company online or over the phone if you have questions about how processes have changed due to the coronavirus pandemic.

Which car insurance companies are offering refunds?

Major auto insurance companies are offering refunds to customers due to the stay-at-home orders across the country.

Insurance CompanyResponse to COVID-19 as of April, 15th
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- 20% credit on April and May premiums
- No policy cancellations or non-renewals until June 2
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 cancelations until May 31
Farmers Insurance- 25% premium reduction in April
- Paused non-payment policy cancellations until May 1
GEICO- 15% credit to policyholders as their policy comes up for renewal. The credit will be applied to 6-month policies renewing between April 8 and October 7, 2020 and 12-month policies renewing between April 8, 2020 and April 7, 2021.
- Also extending the credit to new policies purchased between April 8, 2020 and October 7, 2020
- Paused non-payment policy cancelations until at least April 30
Liberty Mutual- 15% refund on two months of auto premiums
- Late fee charges have stopped and non-payment policy cancelations are paused
- Extended coverage for policyholders who use their personal vehicles to deliver food, medicine, and other emergency goods
Mercury Insurance- 15% off monthly auto insurance premiums in April and May
MetLife- 15% credit for April and May
- Paused non-payment policy cancellations through July 1, 2020
- Extended coverage for policyholders who use their personal vehicles to deliver food, medicine, and other goods until May 1
Nationwide- $50 one-time premium refund per policy or a refund on a percentage of your policy premium depending on where you live
State Farm- On average, most customers will receive a 25% policy credit
Travelers- 15% credit on April and May premiums
USAA- 20% credit on two months of premiums for policyholders with active policies as of March 31, 2020
- No policy cancellations or late fees through June, 17 2020
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Should I reduce my car insurance coverage during the coronavirus outbreak?

If you plan to travel by car during the coronavirus pandemic you should keep your car insurance policy in-force. A typical “full coverage” policy includes the following components of car insurance:

Coverage TypeWhat It Does
Bodily injury liabilityThe part of your liability coverage that pays for medical bills if you've injured someone in an accident
Property damage liabilityThe other part of liability coverage, covers the cost of property damage you've caused in an accident
Personal injury protectionCovers medical expenses for you or your passengers after an accident
Uninsured/underinsured motoristCovers the costs if you're in an accident caused by a driver with little or no car insurance
ComprehensiveCovers damage to your car that happens when you're not driving
CollisionCovers damage to your car after a car accident, no matter who was at fault

You may be leaving your car in the garage a lot more given the evolving guidelines about staying home during the coronavirus pandemic. But if you’re tempted to drop some of your optional car insurance coverage, like comprehensive and collision, which pay for damage to your own car after an accident or another type of peril, consider whether or not you could afford to pay out of pocket to fix or replace your car.

Remember that even without your daily commute, you may still need to drive. And even during a pandemic, your car could be damaged, stolen or totaled in an accident, and without comp and collision insurance, you wouldn’t be covered.

If you’re putting your car into long-term storage, you might be considering reducing your coverage to just comprehensive, which would leave it protected from damage that could occur while it’s stored away. Some car insurance companies call this comp-only insurance, or car-storage insurance. But you should only do this if you’re not planning on driving it at all. Many car insurance companies won’t let you reduce coverage to comp-only until after your car has been in storage for at least a certain number of days or weeks.

If you want to temporarily lower your coverage amounts you should contact your insurance company over the phone or online to talk about what is best for you during this time. You don’t want to go underinsured, but you don’t want to be overpaying either, especially during a global crisis, so speak to your car insurance provider and see if you can qualify for any new discounts or if they have any options for helping you save during a stressful time.

Learn more about the difference between full coverage car insurance and liability insurance.

How do I file a car insurance claim during the coronavirus outbreak?

The claims process will probably be the aspect of car insurance most affected by the coronavirus pandemic. Since car insurance claims usually involve multiple parties, the claims process may be delayed slightly if offices or business are closed. For example, your local repair shop may not be running the same business hours as usual or may be closed altogether.

That said, if you get into a car accident, you can file a claim with your insurance company in a few different ways that follow social distancing guidelines.

  • Through your insurance company’s website
  • Over the phone
  • Through a mobile app (depending on your provider)

Once your claim is accepted by your insurance provider, normally they would assign you a claims adjuster to investigate the situation. However, due to COVID-19, you might need to work with your adjuster virtually. For example, your adjuster may request a video call to survey the damage. As standard practice, you should also always take pictures of the damage and collect as much evidence as possible. Like we mentioned, claims may take longer to process during the coronavirus pandemic. This also goes for medical expenses and bills, as well as vehicle repairs.