Wednesday, December 7th, 2022

Illinois Division of Insurance coverage investigating overcharging in auto insurance coverage

Illinois Department of Insurance investigating overcharging in auto insurance

The Illinois Division of Insurance coverage has known as on auto insurers to supply extra info on how a lot insurance coverage corporations might have overcharged Illinois drivers throughout the 12-month pandemic interval between March 2020 to February 2021.

Insurers have come beneath scrutiny because the Shopper Federation of America (CFA) discovered that auto insurers acquired $42 billion in extra premium whereas refunding solely $13 billion in 2020. Within the state of Illinois, every driver is required to buy auto insurance coverage, however the pandemic had Individuals driving much less as they labored from house, which meant fewer crashes and insurance coverage claims.

The Illinois Division of Insurance coverage believes the pandemic-related impression of getting fewer dangers on the highway “was not mirrored within the costs they charged for protection.” Because of this, every buyer is alleged to be short-changed a median of $125 per insured automobile, CFA reported.

“We applaud the Division of Insurance coverage and Pritzker administration for in the present day’s motion,” Abe Scarr, state director at Illinois PIRG, mentioned. “If the information present, as we anticipate, that insurers made windfall earnings throughout the pandemic, we’ll name on them to difficulty further buyer refunds.”

This Division’s motion is in response to a letter written and despatched by 16 state senators and 9 advocacy organizations final January. Most insurers have supplied some refund after public strain mounted, however CFA estimates insurers may nonetheless owe clients as much as $896 million in pandemic reduction.

“Illinois has among the many weakest auto insurance coverage charge client protections within the nation, so we respect regulators exercising the authority they do have,” Scarr mentioned. “We stay up for working with the Division and Illinois policymakers to enhance auto insurance coverage client protections going ahead.”

California, New Mexico and Washington Departments of Insurance coverage have issued related information calls to totally assess the impression of mileage reductions on the publicity to the chance of loss throughout the pandemic.

Insurers have till Could 15 to current the requested info, which will likely be then made public by the tip of June.

Supply hyperlink

Leave a Reply

Your email address will not be published. Required fields are marked *