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Allstate Returning $600 Million in Car Insurance Premiums Due to Coronavirus

By Eric Volkman - Apr 7, 2020 at 6:22PM

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Policy holders will effectively get 15% of their premiums refunded in both April and May.

Since many of its clients are effectively self-quarantining at home in the face of the SARS-CoV-2 coronavirus pandemic, Allstate (ALL 3.00%) has elected to give them a break. The company announced Monday that it will hand out a "Shelter-in-Place Payback" refund to most holders of its personal auto insurance policies.

The refund will take the form of a payout of 15% of a qualifying customer's monthly premium in both April and May. This will be effected through a credit to the customer's bank account, credit card, or directly to their Allstate account. The insurer said it was working with state regulators to get this done "expeditiously."

In total, Allstate says that this initiative is worth $600 million.

Allstate headquarters building.

Image source: Allstate.

On top of that, Allstate emphasized in its announcement that customers having a tough time financially can contact the company to request deferring their premium payments without penalty. The company will also consider "pay what you can afford" situations. 

Additionally, Allstate is making its Allstate Identity Protection product free of charge for the rest of this year, and not only for its customers. Any U.S. resident can sign up for the service this month or next to receive the perk.

"We have learned to move quickly and put people first,", the company said of the current situation with the coronavirus, and its reaction to it. "This crisis is pervasive."

Investors seem to be signaling approval of this program. In mid-afternoon trading Tuesday, Allstate shares were moving more or less in concert with the wider stock market and numerous top stocks, with a 1.3% gain.

 

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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