Personal auto

Preliminary data for May suggests auto frequency is down about 43%. The figure is close to the ~50% benefit we observed in April, but nevertheless shows a lessening of the frequency benefit.

Allstate has extended its 15% premium rebate by a month. Notably, a few other companies have also added to their original rebates including State Farm, USAA and American Family.

The “empty-street” economy has left auto-exposed names in a relatively favorable position – so much so that they have been returning premiums to clients.

On Tuesday, the BLS released March CPI data that included a downward spike in auto price inflation to -6.2%, driven by declines in accident frequency related to country-wide Covid-19 lockdowns.

Horace Mann released its Q1 results which included a 6.9pt decline in its combined to 88.6% and a 23.8% increase in its operating EPS to $0.78.

Two of the largest carriers’ Q1 calls highlighted significant declines in miles driven and accident frequency, in line with our previous findings.

In the quarter, Allstate’s 15% premium refund contributed 2.4pts to its headline combined ratio.

Following a flood of announcements last week, a host of new carriers have outlined premium rebates for personal auto coverages.

The BLS released March CPI data that included a spike in auto price inflation to 1.1%. We expect this is likely to prove an aberration given the change in loss-trend drivers in recent months.

Kemper today become the latest carrier to announce a partial refund for customers.

Progressive included a 20% rebate for commercial lines customers with BOP and GL policies – potentially the first indication of rebates spreading from auto to small commercial customers.

US personal auto customers will get a 15 percent credit on their April and May premiums, the company said.