COVID-19

With people driving less, insurers may be making big profits

Despite some refunds to drivers, auto insurers could be pocketing large amounts of money thanks to the coronavirus pandemic.

Even though Michiganders are driving a lot less than they were just a few months ago, most are paying about the same for insurance. That may be leading to a major windfall for the state’s auto insurers.

Many auto insurers will pay back their customers 15 to 20% of their premiums for April and March, according to a report in Bridge Magazine. That could mean more than $100 for some drivers, but less than $10 for others.

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Those paybacks may be a small amount for insurers who have seen steep declines in auto insurance claims since March.

“Fewer cars means fewer car accidents and fewer dollars being paid out by the insurers,” said Steven Gursten, an attorney with Michigan Auto Law in Farmington Hills.

“When you just do the math real quick you realize that while it is nice TV propaganda, it’s actually very misleading, and they’re certainly keeping a lot more of your money than they’re giving back,” he said.

You can read the full story here.

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