2 insurance companies refund millions as COVID-19 pandemic makes Americans drive less

Apr. 6--Allstate and a regional insurer will refund hundreds of millions of dollars in car insurance premiums as the coronavirus pandemic has led home-bound Americans to drive less.

Most Allstate customers will get back 15% of their premium for April and May, the company said. In total, the insurer is giving back more than $600 million.

American Family Insurance, a Wisconsin-based insurer, will return $200 million to customers, the firm said Monday. Each customer will get $50 per vehicle, and, in total, the insurer said it's printing 2.3 million checks.

"Less driving means fewer accidents," Allstate CEO Tom Wilson said in a statement. Fewer accidents means less an insurer has to pay out.

"Customers are not driving as much," American Family CEO Jack Salzwedel wrote in a post on LinkedIn. "As a result, we believe they've overpaid in their premiums. It's our duty to return that premium, because it belongs to them."

Driving has decreased in all major U.S. cities as stay-at-home orders keep Americans inside their homes and off the roads.

Trips outside the house are limited to important errands, like grocery and pharmacy runs, for most workers. Workers deemed "essential" can still commute normally.

Traffic has decreased 69% in Mecklenburg County, according to data from StreetLight, a transportation data firm, and Cuebiq, a cell-phone location data firm. In Wake County, driving is down 72%.

___

(c)2020 The Charlotte Observer (Charlotte, N.C.)

Visit The Charlotte Observer (Charlotte, N.C.) at www.charlotteobserver.com

Distributed by Tribune Content Agency, LLC.