Car accidents have fallen durign the coronavirus lockdown says Richard Harding, chief executive of Tower Insurance.
Tower Insurance has followed AA Insurance’s pledge not to make a profit on car insurance resulting from a drop in car crash claims during lockdown.
Late last week AA Insurance froze premiums on house, car and contents insurance, and set up a $2 million hardship fund into which it could dip to assist policyholders struggling to pay premiums.
Now, Richard Harding, chief executive of Tower Insurance vowed the NZX-listed company would not profit from Covid-19, and would make premium refunds to its car insurance policyholders by the end of May.
“We know that people are driving less, and this is resulting in lower claims, so any savings we make will be passed back to our customers,” Harding said.
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“There is still a whole lot of uncertainty at the moment and we have not processed refunds on this scale before, which is why we need some time to calculate and arrange them,” Harding said.
On Thursday, April 16, AA Insurance’s chief executive Chris Curtin said AA Insurance was experiencing a drop in the level of car insurance claims made during March and April, following the Covid-19 Level 4 restrictions which have meant New Zealanders were staying home and driving less.
AA Insurance is majority-owned by Vero, which is in turn owned by Australian ASX sharemarket-listed Suncorp.
So far IAG, the country’s largest insurer has not followed suit. IAG owns the State, NZI and AMI brands.
Like the other insurers IAG has made public statements about helping policyholders who suffer financial hardship as a result of the economic downturn caused by the fight against coronavirus.
IAG chief executive Craig Olsen said on March 23 the company had set up a specialist team to “field requests” from customers who had fallen into financial hardship.