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A combination of factors prompted by the pandemic could result in a decline of 6.2% in personal auto insurance premiums written and 3.5% for commercial auto for all of 2020, according to the latest forecast by Deloitte's actuarial team.
For personal auto, the premium drop could come in the form of refunds or dividends to policyholders, as well as premium discounts upon renewal. Most personal auto carriers returned between 10% and 25% in premiums to customers during March, April and May to account for the vastly lower number of miles being driven, Reuters reported. However, these credits are likely short-term in nature and may only impact premiums in quarters two and three of 2020. Premium volume may be restored once carriers complete their COVID-related returns and driving starts to return to normal levels.
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