Allstate, one of America's largest automobile insurers, is likely to grant additional rebates to its customers as the coronavirus pandemic and subsequent lockdowns have drastically reduced the number of miles most Americans have driven over the past few months. Company CEO Tom Wilson told Reuters in an interview that this time, the rebates would be tailored to reflect the reduced driving by geography, but he stopped short of offering any specific percentage figures.
Wilson noted that people are driving more than they were in mid-April, but still 30% to 40% less than before the pandemic. There has been an increase in driving in areas where people are no longer bound by stay-at-home orders, but also in places where such orders remain, the CEO said. Wilson added that driving patterns are different in urban areas, where driving might be down by 50% to 60% than before the pandemic, compared to rural areas, which might be down by 20%.
Allstate is in the process of distributing the initial $600 million “payback” to most customers of 15% of their monthly premiums in April and May, Wilson said. The Shelter-in-Place Payback program was announced on April 6. The insurer based the initial driving frequency analysis partly on data that Allstate collects from tracking products that some customers agree to use in exchange for discounts.
Wilson declined to provide specifics on the possible timing of a second rebate, noting that a tailored approach to the issue would require more analysis than issuing a flat 15% rebate to all customers, he said. Allstate developed the initial program in about 10 days, but more specificity will take longer, Wilson said.
Most major auto insurers have announced rebate programs, and you can find a recap of those here. Allstate was one of the first out of the gate with its initial rebate program, so we'll be keeping our eyes out for signs that other insurers will follow suit with a second round of coronavirus discounts. If you have questions about your own policy or rebate, be sure to contact your insurance agent.
Material from Reuters was used in this report.