Statement of Commissioner Lara on COVID pandemic auto premium refunds
News: 2021 Press Release
LOS ANGELES — Insurance Commissioner Ricardo Lara issued the following statement after three insurance companies complied with his order to submit additional data to the Department of Insurance about auto premium refunds they provided to consumers during the pandemic and as a result of state and local public health “stay at home” orders. On October 5, he ordered Allstate, CSAA, and Mercury to respond within 30 days or face legal action.
“My top priority is protecting consumers. Allstate, Mercury, and CSAA have responded to my order by turning over data on the premium refunds they provided to policyholders and their claims experience during the pandemic period. My department will evaluate the data and determine how much in additional premiums each insurance company owes their policyholders.
“I have been clear that half-measures and incomplete actions aren’t enough. My goal is to have an accurate and fair determination of what each insurance company’s appropriate amount of premium refund should be. In this matter, and in all matters before us, we will continue to hold insurance companies accountable and protect consumers.
“This new phase represents a last and final warning to other insurance companies that have not adequately returned premiums to consumers. These companies must provide policyholders with a commensurable data-driven amount of additional premium refunds and promptly report their actions. We are prepared to take any and all actions necessary to ensure consumers are treated fairly.”
- Commissioner Lara issued his first bulletin directing insurance companies to provide partial premium relief on April 13, 2020 (Bulletin 2020-3). He extended this order in two follow-up bulletins on May 15, 2020 (Bulletin 2020-4) and December 3, 2020 (Bulletin 2020-8). The bulletins directed insurance companies to report to the Department of Insurance how much premium they returned, whether it was a partial refund, dividend, credit or other form of payment, and other measures. View insurance company reports at the Department of Insurance website.
- Commissioner Lara’s actions have saved California drivers $2.4 billion to date through returned premiums.
- While all of the top 10 private passenger insurance groups offered partial premium relief ranging from 10 to 22 percent for the months of March to May 2020, Commissioner Lara announced in March 2021 that insurance companies continued to overcharge drivers.
- The Department of Insurance sent letters to Allstate, CSAA, and Mercury on October 5, 2021, ordering them to respond within 30 days or face legal action.
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Led by Insurance Commissioner Ricardo Lara, the California Department of Insurance is the consumer protection agency for the nation's largest insurance marketplace and safeguards all of the state’s consumers by fairly regulating the insurance industry. Under the Commissioner’s direction, the Department uses its authority to protect Californians from insurance rates that are excessive, inadequate, or unfairly discriminatory, oversee insurer solvency to pay claims, set standards for agents and broker licensing, perform market conduct reviews of insurance companies, resolve consumer complaints, and investigate and prosecute insurance fraud. Consumers are urged to call 1-800-927-4357 with any questions or contact us at www.insurance.ca.gov via webform or online chat. Non-media inquiries should be directed to the Consumer Hotline at 800-927-4357. Teletypewriter (TTY), please dial 800-482-4833.