Personal auto

Two of the largest carriers’ Q1 calls highlighted significant declines in miles driven and accident frequency, in line with our previous findings.

In the quarter, Allstate’s 15% premium refund contributed 2.4pts to its headline combined ratio.

Following a flood of announcements last week, a host of new carriers have outlined premium rebates for personal auto coverages.

The BLS released March CPI data that included a spike in auto price inflation to 1.1%. We expect this is likely to prove an aberration given the change in loss-trend drivers in recent months.

Kemper today become the latest carrier to announce a partial refund for customers.

Progressive included a 20% rebate for commercial lines customers with BOP and GL policies – potentially the first indication of rebates spreading from auto to small commercial customers.

US personal auto customers will get a 15 percent credit on their April and May premiums, the company said.

Geico has raised the stakes in the arms race on customer rebates. Unlike other carriers to date, its plan is structured to more explicitly motivate retention, attract new business and protect float.

Geico customers will get a 15 percent credit on renewing auto policies.

Yesterday, Allstate and American Family announced a plan to partially refund personal auto premiums. We expect these to be the opening bids in a protracted battle with regulators.

The carrier will hand $600mn in premiums back to auto customers to reflect the decline in driving due to the Covid-19 crisis.

The carrier has agreed to reinsure legacy business underwritten by Zurich from 1 October 2015 to 30 September 2018.