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Ups and downs with auto insurance rates during COVID-19

I-25 Colorado Springs
Posted at 7:51 PM, Aug 11, 2020
and last updated 2020-08-11 21:51:07-04

COLORADO SPRINGS — One of the ripple effects of COVID-19 in Colorado is an impact on automobile insurance. Many drivers got breaks on their premiums when so many stopped driving during stay at home orders in the first months of the pandemic. "People were driving less, they were working at home. So, we saw driving and crashes dip significantly," said Rocky Mountain Insurance Association, Executive Director, Carole Walker. Now there are other COVID caused trends that will likely end those discounts.

There are indicators showing a lot more cars are back on Colorado roads. "What we're seeing is now pre-pandemic levels off gas consumption, which you can draw a dotted line to driving going right back up to where it was," said Walker.

There are other factors, however, showing it is not necessarily the same drivers. Mass transit for example is experiencing a dip in ridership likely because of some people nervous about COVID-19. Part of them may be back in their cars and on the road.

COVID-19 is also credited with a shift in how people are taking summer trips during 2020. A lot more people are driving for trips closer to home. The higher than typical number, adds to traffic.

Insurance risk analysis looks at the COVID-19 caused changes, while also considering on-going issues. "We still have hail. We got hit in south Colorado Springs this week," said Walker. Colorado weather is always a factor.

Then there is a potential impact that could result from attempts to help people who faced sudden financial issues because of COVID-19. Similar to eviction moratoriums for renters, some struggling with auto insurance payments because of COVID have been differing them for months. "What do they do when all of a sudden they're going to owe six months premium because it wasn't forgiveness it was deferral." Walker says it is a possibility causing concern for insurance companies.

She says it then could affect the cost of insurance for everyone. "The rest of us who are able to pay our insurance premiums will have to pay more if people just simply walk away from their insurance premium."

Despite traffic returning to pre-COVID levels, there are still many people working from home full or part time. For those with changes to driving habits, Walker says it is worth some calls and research to see if your individual situation can save some money on your insurance.