Several other forms of insurance, especially life and business interruption insurance show a boom in interest. Current providers find that many customers abandoned the insurance ship.
Relief Efforts
California ordered auto insurers to return premiums to their customers by August of this year, but most big companies did not wait to be told. Just about every household name insurer for automotive use offers some form of relief. Some return premiums between certain dates while others reduce the amount collected. Some just send cash directly. With so many people stuck at home, obviously fewer accidents occur.
Therefore, there is no reason to charge them for a risk they are not taking. Customers are grateful to their insurance providers for the relief. However, a current J.D. Power study shows that even these efforts fail to build loyalty.
Not Enough for Many Customers
The study showed, first of all, that thirty-seven percent of those eligible for these policies were not even aware that they were going to benefit from them. There has been a communication problem with the insurers, with some companies choosing to contact each person directly. However, there have been negative effects to this.
When a person finds out that they received relief from their auto insurer, they remain almost twice as likely to switch and find a new plan or provider. In many cases, customers feel that these efforts reflect a paltry response to already high premiums. Fifty-seven percent of customers remain aware of the relief efforts yet feel like they are not enough. Rather than thank their providers for giving them a break, some seem to be insulted by what they seem as a publicity stunt rather than a sincere attempt to help.
Moving On
If it is a publicity stunt, it is backfiring. Those who learn about the policy are instead resorting to other methods to reduce costs. Thirty percent of customers reduce their overall automotive coverage, with about a quarter trying to reduce their deductible. Nearly a third end up shopping for a new carrier entirely. With more people signing on to new policies, it is clear they are not interested in gimmicks and quick fixes, but the long-term costs of insuring vehicles – vehicles that are not even being driven under the Quarantine.
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