The business is to return £110m to car and van customers as part of Stay At Home Refunds as it becomes first to bow to pressure to give back as policyholders use vehicles less. Admiral is to return £110m to its car and van insurance customers in recognition of the fact that its customers are staying at home and driving less during the UK wide Covid-19 lockdown. The provider announced that a £25 refund will be automatically given to all customers for each car and van covered with Admiral as at April 20 2020, a total of 4.4m vehicles. It is believed that Admiral is the first UK provider to take this step following similar moves in the USA which last week had returned up to $800m to customers.
Pressure Last week a number of motor disrupters including Cuvva and By Miles both criticised traditional insurers for failing to return premium to customers who were using their vehicles less due to lockdown. The recent Insurance Age/Insurance Post CovidCast addressed whether or not UK providers were being fair to customers by withholding premium return during lockdown. Admiral detailed that it is giving its customers the refund to reflect that there have been fewer cars on the road during the lockdown and it expects this to result in fewer claims.
Customers don’t have to take any action to receive the refund, it will automatically be credited to them by the end of May. Admiral will be contacting customers over the coming weeks to explain how they will receive the payment.
One third of profits According to the provider, the combined initiatives in total are equivalent to roughly a month’s premium income, or a third of its 2019 profits, and passes on the savings from reduced claims the company may otherwise have benefitted from during the lockdown. Admiral’s intention is to return estimated savings to its customers rather than benefit from reduced driving during the lockdown. Cristina Nestares, CEO of UK Insurance at Admiral, commented: “The Admiral Stay At Home Refund was launched to recognise the considerable efforts people are making by staying home as much as possible and as a result driving less… “There may be fewer cars on the roads at the moment, but for many NHS and emergency services workers their cars are vital for them to get to work. At the best of times it’s stressful if you’re involved in an accident, so we’ve implemented new measures to take some of the pressure off and ensure they can stay on the road.”
Support
NHS
In addition, Admiral is showing its support for NHS and emergency service workers by giving them a free courtesy vehicle if their vehicle is stolen, undriveable after an accident, or declared a total loss, to keep them on the road during the lockdown. The business has also set up the £4m Admiral Support Fund for Covid-19, which is predominantly providing funding and support in south Wales, where the company is based. Nestares added: “During this challenging period, our main priorities have been helping our customers, supporting our local community and protecting the wellbeing of our staff, which is why we have introduced these initiatives to give something back to the customers and communities we serve.
“This is an unprecedented time when people across the country are driving significantly less than before the lockdown, and we expect this to lead to a fall in the number of claims we are seeing. We want to give the money we would have used to pay these claims back to our loyal customers in this difficult time. We have also already reflected this change in driving behaviour in our pricing for customers and will continue to do so.
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