Chubb Limited CB has come forward with a pleasant gesture of rewarding its personal auto insurance customers across the United States amid this crisis period. The clients will be credited with a reduction of 35% in the premium amounts payable in April and May. This will amount to an estimated credit average of $110 per vehicle.
The COVID-19 pandemic has sparked fear across the globe and the United States seems to be severely hit by the same. With the entire U.S. economy entering into a sluggish phase, financial burdens continue to pile up on its residents as well. This latest move by Chubb will somewhat relieve its clients of the financial stress amid this crisis.
Moreover, Chubb intends to reward its policyholders as it is well poised to gain from declining claims amid a reduction in the number of vehicles plying on roads due to the coronavirus-led lockdown. Hence, the insurer has been witnessing fewer insured vehicles on the road. This reduction in travel bodes well for Chubb in the form of lower auto accident claims.
Chubb also seeks to reduce the financial burdens of its clients who own small businesses across the United States. With respect to the policies up for renewal between Apr 1 and Aug 1 of this year, the company will entitle such clients with a 25% reduction in the sales and payroll exposures, which is also needed for calculation of premiums. Additionally, these clients will also receive a 15% reduction in premiums for their commercial auto insurance vehicles.
However, shares of this Zacks Rank #3 (Hold) company have lost 13.9% in a year compared with the industry’s decline of 8.7%. Nevertheless, we believe that the company’s strong fundamentals are likely to drive its shares, going forward.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Notably, three other auto insurers, namely The Allstate Corporation ALL, The Travelers Companies, Inc. TRV and MetLife, Inc. MET, have undertaken similar steps to help its members.
Allstate announced that it will provide a Shelter-in-Place payback worth more than $600 million and refund almost 15% of its customers’ monthly premium in April and May.
Travelers has also initiated a Stay-at-Home Auto Premium Credit program to reward its personal auto insurance customers by refunding 15% on the basis of their auto premiums, payable in April and May.
Similarly, the property and casualty business of MetLife — MetLife Auto & Home — plans to reward its existing auto insurance customers by refunding 15% of monthly premiums payable by members for April and May.
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