The temporary COVID-19 relief measures many providers introduced at the onset of the pandemic to assist their customers who are struggling to pay their insurance bills may be coming to an end.
Back in April, many providers started introducing a broad range of emergency consumer auto insurance and home insurance relief programs to their customers who may have lost their jobs or were working from home as a result of the pandemic. Those measures included such things as one-time or two-time rebates, discounts on premiums, payment deferrals and deferrals on cancelling policies because of nonpayment.
Now, as government restrictions to contain the virus outbreak slowly ease in some parts of the country, and more people may be driving as the economy reopens, several insurance companies are lifting the relief measures they instituted. Is ending the temporary discount programs premature? That remains to be seen. The possibility of a second wave of COVID-19 infections in Ontario and other provinces could prompt governments to shut things down again. Nevertheless, people who are driving more or commuting to work still need to review their auto policies to ensure they are covered.
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What you need to do if you are driving more
If you made changes to your car insurance policy last April or May because you were no longer commuting to a workplace, contact your insurer or broker to let them know if you are back on the road on regularly again.
For instance, if you temporarily suspended coverage on a vehicle because of the economic lockdown, but will be commuting to work again, you need to ask your insurer to reactivate your coverage. Not only is it illegal to drive without car insurance in Canada, if you get into a collision and don’t have coverage, you may find yourself in a world of trouble. The legal and financial penalties for driving without insurance are nothing to scoff at; if you get into a car accident without coverage, the cost associated with the damages may be life-altering.
What you need to do if you continue to work from home
If you are continuing to work from home for the foreseeable future, it can’t hurt to have a quick chat with your broker or insurer to let them know about your situation. Take the time to inquire if they are making changes to their relief programs and how those changes could affect you.
There are still many ways to save money on your auto premium you can take advantage of if you are driving less. For example, you can lower your annual kilometre count, enrol in a usage-based insurance program, and increase your deductibles.
Additionally, if you are continuing to work from home, you might want to review the terms and conditions of your home insurance or condo insurance policy (or give your broker a call and review it together). Don’t assume your existing home coverage will provide adequate protection while you are working from home. Many insurers may view an employee of a company who is working from home the same as someone who is running a business out of their abode. In which case, you may need to make changes to or up your coverage.
What do consumers think of insurers’ rate relief measures?
According to an earlier RATESDOTCA survey, 28% of Canadians say they will continue to work from home after government restrictions ease – a noteworthy increase from the 9% who say they were working from home before the pandemic.
In a separate national online survey, only 25% of Canadian drivers say they were offered rate relief from their auto insurer compared to 64% who say they were not. Another 12% of respondents say they are not sure. Of drivers who received some form of relief, 64% say there were insignificant.
Meanwhile, Ontario’s auto insurance regulator, the Financial Services Regulatory Authority (FSRA), said it would launch a consumer survey in July to assess the financial relief they received to the end of June, adding “company and industry wide consumer relief results may be made public following analysis and evaluation.” The details about that survey and its results remain unknown currently, however, FSRA also said it would monitor how auto insurers in the province are aiding their customers during the pandemic.