California insurance commissioner orders relief for customers

Erie Indemnity

13/04/2020 18:56

April 13 (Reuters) - California's Insurance Commissioner on
Monday ordered insurers to return premiums to consumers and
businesses, adding to pressure on insurers to do more to
mitigate the financial strain on customers caused by the novel
coronavirus crisis.
    Insurance Commissioner Ricardo Lara said premiums paid for
the months of March, April and potentially May, should be
returned for six insurance lines - passenger and commercial
auto, workers' compensation, commercial multi-peril, commercial
liability and medical malpractice.
    The order also includes other insurance lines facing the
risk of loss as a result of the pandemic.
    Major U.S. insurers are already offering credit to auto and
motorcycle policyholders following a decline in driving, as most
Americans stay at home under widespread orders to help contain
the spread of the novel coronavirus.  urn:newsml:reuters.com:*:nL3N2BW0ID
    "With Californians driving fewer miles and many businesses
closed due to the COVID-19 emergency, consumers need relief from
premiums that no longer reflect their present-day risk of
accident or loss," Lara said http://www.insurance.ca.gov/0400-news/0100-press-releases/2020/release038-2020.cfm.
 
    "Today's mandatory action will put money back in people's
pockets when they need it most." 
    As part of the order, insurance companies are required to
provide a premium credit, cut, return of premium, or other
"appropriate premium adjustments" as soon as possible, and no
later than August.
    Insurers collect $310 billion in premiums annually in
California, according to the state's insurance department, the
largest consumer protection agency in California. 

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FACTBOX-Insurers return part of auto premiums as coronavirus
cuts driving    nL3N2BW0ID
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 (Reporting by Noor Zainab Hussain in Bengaluru; Editing by
Shinjini Ganguli)
 ((noor.hussain@thomsonreuters.com; Within U.S. +1 646 223 8780;
Outside U.S. +91 80 6182 2663 or +91 80 3796 2663 ;))