Two major auto insurance companies told their customers they will be getting refunds after they saw a sharp reduction in claims last month. With hundreds of millions of people forced to stay at home due to the coronavirus pandemic, there were fewer cars on the roads and, as a result, fewer accidents.
Allstate said that most customers will receive a 15 percent refund in April and May, which will cost the company about $600 million. American Family Insurance is issuing a refund of $50 per vehicle at the cost of $200 million.
"It is real dollars we expected to pay out this year and no longer have to pay out," American Family COO Telisa Yancy told the Wall Street Journal. "We are sharing it back right now when our customers probably most need it."
Allstate Chief Executive Officer Tom Wilson told reporters during a conference call that driving mileage was down between 35 and 50 percent in March. According to Reuters, he said that there was no difference between states that have enacted stay at home orders and those have not.
To keep up to date on the latest news about the coronavirus and to understand what you need to stay safe and healthy, check out the Coronavirus: Fact vs. Fiction podcast from CNN Chief Medical Correspondent Dr. Sanjay Gupta.
Photo: Getty Images