The insurance industry has been slower to respond to the coronavirus than the banking and investment sectors, but over the past few weeks, 94% of our P&C Insurance Monitor coverage group firms have released statements addressing the pandemic and promoted them across their digital platforms and social media accounts. Insurers have rapidly updated their statements to acknowledge those directly impacted by the virus and by related financial hardships, and some have reiterated their messages by sending email updates and mobile app messages. In addition to ramping up digital communications, insurers have stepped up to find short-term solutions to help policyholders, such as offering flexible payment options, pausing policy cancellations due to non-payment, waiving late fees, refunding partial auto premiums and promoting digital claims processes.
According to our 2019 P&C Consumer Survey, a rising number of policyholders are interacting with their insurers through digital channels instead of in person or over the phone. Notably, carriers’ cross-platform digital offerings were becoming increasingly critical even before the COVID-19 pandemic, but during these times of limited physical contact, insurers are relying even more on online channels to communicate with policyholders. The majority of insurers in our coverage group have added public site homepage banner alerts that link to their COVID-19 resources, but only six firms display policyholder site banner alerts, and seven provide mobile app messaging. Eleven coverage group insurers—Allstate, Amica, Erie Insurance, Esurance, Farmers, GEICO, Liberty Mutual, Nationwide, Travelers, State Farm and USAA—have sent policyholders email updates containing coronavirus messaging.
In addition to these digital communications, insurers are promoting their online policy servicing options and remote customer service resources, especially for claims inspections. Liberty Mutual and Safeco have announced changes in their auto and property claims processes, including ceasing in-home damage inspections and visits to homes and auto body shops for auto appraisals. Notably, Liberty Mutual is promoting its RealTime Review video chat and photo capture features, which let policyholders remotely file claims. While restricted movement may bring fewer personal auto claims, the coronavirus outbreak emphasizes the importance of having robust online claims processing systems.
As millions of Americans face financial hardship due to the economic impacts of the COVID-19 outbreak, insurers are helping their policyholders by waiving late fees, allowing missed payments, and extending policy expiration dates and payment deadlines, among other strategies.
- Many firms are pausing policy cancellations and non-renewals due to non-payment and/or offering flexible payment options. These include Allstate, Amica, Chubb, Esurance, GEICO, The Hartford, Liberty Mutual, Nationwide, Progressive, Safeco, State Farm, Travelers and USAA.
- Allstate, Esurance, Farmers, Liberty Mutual, Nationwide and Progressive are extending coverage to policyholders who are using their vehicles for commercial deliveries of groceries, pharmacy and medical supplies.
One reason many insurers have decided to give back so generously is that shelter-in-place orders and general fear have reduced driving and consequentially, led to fewer accident claims. Some steps firms in our coverage set have taken include the following:
- Allstate, Esurance, The Hartford, Liberty Mutual, Travelers and Safeco plan to return 15% of personal auto policyholders’ two-month premiums.
- Nationwide will offer a $50 one-time premium relief refund for personal lines auto customers.
- Farmers will reduce April auto insurance premiums by 25%.
- State Farm will return 25% of policy premium amounts between March 20 and May 31.
- USAA, Amica and Progressive will return 20% of policyholders’ two-month auto premiums.
- GEICO will apply a 15% credit to policyholders’ next six-month premiums upon renewal.
- American Family will offer policyholders a one-time payment of $50 per vehicle on their policies.
- Allstate and Esurance are offering free identity protection for the rest of the year for any U.S. resident regardless of whether they are already customers.
Many insurers are making donations to COVID-19 relief efforts and non-profit organizations. For example, American Family, along with its subsidiaries and the American Family Insurance Dreams Foundation, announced a $6.8 million donation to COVID-19 relief efforts and other non-profits. Travelers meanwhile announced a $5 million donation to assist communities in North America, the UK and Ireland.
Corporate Insight is closely monitoring how firms are responding to the COVID-19 pandemic. Read our continuing coverage on our company blog, and for our clients, we have launched an authenticated site section that collects all messaging across all firms we track in the following industries: Banking, Healthcare, Insurance/Annuities, Investing and Retirement.
If you are not a Corporate Insight client, follow the links provided to learn more about our P&C Insurance Monitor research and our P&C Insurance Digital Audit.