The majority of car insurance companies are refunding customers or discounting driver's bills due to COVID-19 stay-at-home orders. It's money back in your pocket, but is it enough?
Our sister station WTVD-TV reports that many viewers got their refund checks this week from their insurance companies and are beginning to see discounts on their bills, but many said they are disappointed in the amount of money they are seeing back in their pockets.
Driver Norma Gould, for example, said she hardly uses her car at all during the COVID-19 pandemic. She received a credit to her bill, but she said she'd rather see a refund check.
"Receiving credit won't put food on the table, pay the light bill or allow you to get much-needed medicine," she said. "There needs to be an open discussion as to how those companies can better help all affected policyholders."
Some insurance companies, like Nationwide, sent customers a refund check. Many drivers covered by Nationwide reported getting $50 refund checks this week.
Nationwide said the refund is equivalent to an average savings of 15% for two months and is on top of existing discounts customers already earn.
Ben Gufford, from Wilson, North Carolina, will be getting a credit on his next billing cycle.
"It's better than nothing," he said.
Gufford's insurance company is Geico, which is giving policyholders a 15% credit on their next six-month or 12-month policy term. While Ben's grateful for his $38 credit, he'd like to see it be more.
"We were at a stay-at-home order the entire month of April and a part of March, so I wouldn't have minded having that premium refunded to me," Gufford said.
His monthly premium amounts to about $50 a month, so he would have gotten more money back. As Geico has their credit policy set up now, Gufford will have to wait until July to get his $38 credit.
A new study just released by two consumer groups, The Center for Economic Justice (CEJ) and the Consumer Federation of America (CFA), shows a decline in miles driven and crashes due to the COVID-19 pandemic.
Bob Hunter, the director of insurance for the CFA, said this proves that insurance customers need more relief.
"People aren't driving anymore. The risk has gone way down," he said. "So it's a double savings for the insurance companies. It would be a COVID-19 windfall for them if they didn't give back the money."
According to the data, collected by the consumer groups in North Carolina over the last month and a half, there's been a reduction in miles driven by at least 50%.
"We concluded that a fair payback for March, April and May would be at 30% and most companies are around 15%. Some are even less. A few are at 30%. State Farm is close at 25%," Hunter said.
It is unclear if Hunter's analysis applies to other states.
At this point, car insurance companies haven't announced if they will offer new relief efforts. When it comes to the refunds and credits that were already announced, customers don't need to take any action -- they will get those automatically.
Car insurance companies sent refund checks to drivers and credited bills, but is it enough?