A text by Isabelle Roberge from The bill
1- Insurers offer discounts on automobile insurance premiums. How to take advantage of it?
Almost without exception, all the insurers contacted by The bill offer a 15%, 20% or even 25% discount on one, two, three monthly payments and sometimes more. For some, this discount is automatic, while others ask you to contact them.
NO NEED TO CONTACT :
– SSQ insurance : 20% discount on the premium, covering collective confinement every month from April 1, 2020
– La Capitale (and its subsidiary L’Unique) : 20% discount on the monthly premium, automatically calculated on the premium for each month of confinement from April 1, 2020
– Industrial Alliance : 20% discount for the months of April and May, and possible extension.
– Allstate, Pembridge and Pafco : a single 25% discount for a single monthly payment. Check to come in May.
YOU MUST CONTACT THEM :
– Gardens : temporary discount on monthly payments for 3 months if you do not drive to go to work or make deliveries. The form must be completed by May 31, 2020. Or an annual premium reduction based on the mileage reported.
– Promutual : discount for three months, calculated according to the reduction in the use of the vehicle. The form must be completed by May 31, 2020.
– Intact Insurance and belairdirect : adjustment of the premium according to the mileage declared for three months, a reduction evaluated on average at 15%. Premium reduction of 75% per month, on average, when customers park and store their vehicle safely.
– TD Insurance : reduction of the premium until July 16, 2020 for customers who use their car less.
– RSA : premium reduction until June 30 for customers who use their car less
– Aviva Canada : adjustment of the premium according to the mileage declared for three months, a reduction evaluated on average at 15%. Premium reduction of 75% per month, on average, when customers park and store their vehicle safely.
Do you deliver food, groceries or medicine during the pandemic? Be aware that several insurers will not increase your premium.
This is the case for SSQ Insurance, Intact Insurance, belairdirect, Allstate, RSA, Aviva, TD Insurance and Desjardins.
However, if you deliver through third-party apps or services like UberEats, Skip, or DoorDash, you’re generally not covered.
Insurers are following the same policy as before the containment, said Christopher Johnson, outgoing president of the Regroupement des cabinets de courtage assurances du Québec (RCCAQ).
He advises deliverers, even volunteers, to notify their insurer, so as not to be caught off guard if an accident occurs:
an insurance contract is a good faith contract.
2 – I had a sharp increase in my auto insurance premiums in 2020. Since my insurer is now offering me a discount during the COVID-19 period, does that mean that the premiums will go down?
Keep in mind that these discounts and reductions offered at this time are temporary. Insurers don’t give you a gift: they simply give their customers the money they are currently saving on claims.
It’s still the law of large numberssums up Christopher Johnson, outgoing president of the Regroupement des cabinets de courtage d’assurance du Québec (RCCAQ).
From mid-March, people were confined. We saw the result on the roads. Cars do not travel, so there is less risk of accident and therefore fewer claims for insurers.
Please note: No insurer is currently offering such a gift to owners of RVs, motorcycles or snowmobiles.
So far, the majority of insurers have focused on auto insurance policies in these pandemic times.
Power Corporation of Canada Research Chair in Pension and Insurance, Martin Boyer, explains:
lost leader in the area. This is not a contract on which insurers make money. They use this contract to get lists of clients who would also need the other insurance companies make real money with: home insurance, liability, identity theft and the rest of the range of profits. « , » text « : » In fact, auto insurance is considered a lost leader in the industry. This is not a contract on which insurers make money. They use this contract to get lists of clients who would also need the other insurance companies make real money with: home insurance, liability, identity theft and the rest of the range of profits. « }} » lang = « en »>In fact, auto insurance is considered a lost leader in the area. This is not a contract on which insurers make money. They use this contract to get lists of customers who would also need the other insurance companies make real money with: home insurance, liability, identity theft and the rest of the profit spectrum.
The HEC Montreal professor adds that competition in auto insurance is fierce at all times.
And while home insurance peaks in the summer when you move, auto insurance doesn’t experience such a turning point in the year,
which means that every month, there are a twelfth of people who shop….
By demonstrating their flexibility in COVID-19 time, insurers hope to seek new customers or, at least, not to lose those they already have …
3 – Why is there no rebate or rebate in home insurance as is the case for auto insurance?
Currently, in home insurance, the risk has not diminished. It has even increased!, points out Martin Boyer of HEC Montréal.
Yes, the number of thefts is currently decreasing, but the value of theft claims is minor in the industry. What accounts for the bulk of the claims, says Boyer, are fires and water damage, such as a faucet left on for a long time. I would argue that due to human negligence, there is more risk during a period of confinement!
The argument is supported by Christopher Johnson of the RCCAQ, who nevertheless points out that more occupants could prevent a water damage or a fire from spreading.
But COVID-19 will not erase torrential rains or fires, he recalls. And more residents in the home means more risk of causing damage. Not to mention the risk posed by the work that has to be postponed, for example: that a master roofer comes to change your roof which is aging.
Some insurers still accept to take… risks.
TD Insurance and Desjardins automatically increase the coverage limit provided for in home insurance contracts for goods used to work from home, such as computer equipment or a chair, automatically and for all their customers. ergonomic.
At SSQ Insurance, telework will not affect insurance premiums either, as at RSA, Aviva, La Capitale, and Unique.
If you temporarily provide child care for a number
reasonable children to help families affected by COVID-19, Intact Insurance and belairdirect extend your coverage for the duration of the crisis, at no cost.
Although these offers are often automatic, the Insurance Bureau of Canada (IBC) suggests that consumers inform their insurer or broker of the new use made of their home. In some cases, the responsibility for insuring would rest with the employer.
I could not predict how the law will be interpreted, since in this case, telework is not the choice of an individual, it is an obligation, says HEC Montréal professor Martin Boyer, who therefore suggests that teleworkers check with their insurer and their employer.
: we agreed to lend you the equipment, but we never forced you to take it to work … « , » text « : » Imagine computers being stolen, containing lists of customers … who is responsible civil liability?, he argues. Or, a short circuit in your equipment loaned by the office burns your house: who is responsible? Your insurer may argue that you did not inform them that you now have your home office and that it was your employer’s equipment that caused the fire. You then turn to your employer who tells you: we agreed to lend you the equipment, but we never forced you to take it to work … « }} » lang = « en »>Imagine that computers are stolen, containing lists of customers… who is responsible for the civil liability ?, he argues. Or, a short circuit in your equipment loaned by the office burns your house: who is responsible? Your insurer may argue that you did not inform them that you now have your home office and that it was your employer’s equipment that caused the fire. You then turn to your employer who tells you: we agreed to lend you the equipment, but we never forced you to take it to work …
4- I would like to reduce my monthly premiums in home insurance. Is it a good idea?
Consider your needs carefully, but resist the urge to reduce your coverage at all costs, advise our three experts and BAC.
Not only because containment can mean higher risk of fire and damage, but also
because our home is our biggest investment, insists Christopher Johnson of the RCCAQ.
For this reason, he confirms, few clients have contacted brokers to explore this avenue.
As soon as you have a mortgage on your house, you need at least fire insurance, says Daniel Gardner. Otherwise, you will default with your mortgage lender who will lose the full value of his loan in the event of a fire.
The specialist in civil liability deplores the fact that too often
of consumers shop more for a premium than a protection, so do not take the protections that would be interesting for them.
All in all, if you absolutely want to reduce your premiums, the three specialists consulted by The bill consider it preferable to increase the deductible provided for in the contract.
Martin Boyer summarizes:
000$. Once the fire is declared, the catastrophe is not to pay a high deductible, it is that the house burns « , » text « : » When a fire starts, it may ravage the whole house. A high deductible is better than agreeing to a reduction in coverage of $ 100,000. Once the fire is declared, the catastrophe is not to pay a high deductible, it is that the house burns « }} » lang = « en »>When a fire starts, it can destroy the whole house. A high deductible is better than agreeing to a reduction in coverage of $ 100,000. Once the fire is declared, the catastrophe is not to pay a high deductible, it is that the house burns down, says the professor at HEC Montréal.
The Quebec Insurance Brokerage Firm also notes that coverage is often offered as a package.
Therefore, withdrawing an endorsement, such as theft, may also remove other protections, such as bringing animals into the home and the possible inherent havoc or infection.
For many clients, this period of confinement is the first time that they really look at their insurance contract, reports damage insurance broker Christopher Johnson. An opportunity, in fact, to check whether it is possible to benefit from better protection with a small premium increase.
The time of confinement is also a good time to shop for your insurer.
However, changing your insurer during the contract may result in the cancellation penalty, which increases with the number of months remaining in the contract.
Not to mention that often, says Johnson, people have their car and home contracts with the same insurer. If they keep only one of them, they are penalized.
The consumer should ask himself for each change, for each economy he is currently making, what long-term financial impacts could arise in the event of a claim.
5- My finances are very tight. Can I defer payment of my insurance premiums, as is the case with other financial products?
Several insurers approached by The bill, like Allstate, Aviva, Desjardins, Industrielle Alliance (iA), Intact assurance et belairdirect, Promutuel, SSQ Assurance and TD Assurance, offer their customers to defer the payment of one or more premiums, mainly for auto insurance and dwelling.
Some of them extend this offer to life insurance and health insurance: this is the case for Canada Life and IA Financial Group. The latter even adds critical illness, disability and personal injury insurance to the list.
Contact your insurer to see the terms or fill out the form on their website. Many can defer one, two or even three monthly payments, up to three months. The answer varies by company, customer, and even by product. For example, Industrial Alliance allows deferral of up to 60 days for auto insurance, but 90 days for life, critical illness, disability and personal injury insurance.
Also check the deadline for submitting such a request. For example, you have until May 31, 2020 at Industrielle Alliance, which allows you to carry over a single monthly payment.
Are the savings interesting?
Paying an insurance premium doesn’t compare to a mortgage, says Anne Morin of the Insurance Bureau of Canada (IBC), which represents 90% of the damage insurance market in the country for individuals (such as home and auto insurance) and for businesses.
The average auto insurance premium is $ 600 a year, so $ 50 a month. In home insurance, the average premium is around $ 700 to $ 800 per year.
Despite everything, the measure is popular.
According to what our members report to us, many calls received relate to the deferral of payment, both for individuals and businesses, reports Christopher Johnson, the outgoing president of the RCCAQ.
His office alone, AMR Assurances Multi-Risques, receives around 100 calls a week on the subject.
Mr. Johnson confirms that during
carryover, customers continue to be insured, coverage is not suspended.
Provided, of course, to reimburse one day.
6- If I postpone my payments, will I have to pay interest when reimbursing these deferred premiums?
This is the good news: there are no fees or interest for most insurers! When asked about this, Intact Insurance and belairdirect, Desjardins, SSQ Insurance, Promutuel Insurance, and Canada Life all agreed not to charge any fees or interest to defer payments.
If in doubt, check with your company anyway.
And how will you reimburse these payments? Again, the terms vary.
SSQ Insurance explains that, for its part, the situation is
analyzed on a case-by-case basis and may depend on the expiry date of the contract in force.
Desjardins Insurance can, for its part,
$ in bonuses, so that’s 300$ which will be spread « , » text « : » postpone the full payment of the deferral to the resumption of payments, or offer to spread the deferral over the number of payments remaining at the end of the insurance contract. If the equivalent of $ 300 in premiums is carried over, then $ 300 will be spread « }} » lang = « en »>postpone the full payment of the deferral to the resumption of payments, or offer to spread the deferral over the number of payments remaining at the end of the insurance contract. If the equivalent of $ 300 in premiums is carried over, then $ 300 will be spread out.
Promutuel will spread the amount equally over the withdrawals remaining in the contract, while Industrial Alliance offers to distribute the reimbursement over the payments for the following 12 months.
Intact Insurance and belairdirect offer you to do all of this, or simply add the entire payment on the next payment.
To have! Ask your company.
7- Will I still be covered if I default on payment?
No doubt, but don’t assume. Check it out.
TD Insurance announces:
We temporarily suspended home and auto insurance cancellations for non-payment.
Aviva Canada says it
will continue to provide insurance protection during this period.
The measure is followed by several insurers due to the exceptional situation, confirms the BAC, which adds that you must however
notify your insurer immediately. Note that before canceling your policy, the insurer must send you a notice.
In the next three months, several companies also agree not to charge you the usual fees for checks or bad pre-authorized payments. This is the case for Aviva Canada, RSA, SSQ Insurance, Intact Insurance, belairdirect and TD Insurance, among others.
On the other hand, that does not save you the costs that the bank, it, can impose you for this same default of payment.
So also check with your bank.
8- Do insurers offer the same relief measures to all their customers?
No. For example, some of the insurers only benefit their clients if they experience special conditions, such as having been quarantined or having to leave their job to take care of a loved one. This is the case with Industrial Alliance.
Otherwise, all insurers offer you tailor-made services. This is the case, among others, of Intact Insurance and its belairdirect subsidiary:
As our clients’ situations are unique, we work with each of them to find the solution that best meets their needs., explains her representative Carine Salvi to The bill.
This allows us to be more flexible and adapt our financial relief measures to individual circumstances.
SSQ Insurance, La Capitale, L’Unique and SunLife and RSA also prefer to examine your file before promising you anything.
Nothing in law obliges insurers to make an accommodation, says Daniel Gardner of Laval University.
They do it for competition reasons first. And if they want to see the head of the client, it is because they want to keep some leeway and not be forced to give the same accommodations to everyone. In the business, there are insured people who are happy to get rid of…
Martin Boyer of HEC Montréal does not rule out this hypothesis. But, he said, competition weighs more heavily on insurers’ decision to offer tailor-made.
The world has time to shop for insurance these days …, he points out.
He even believes that it would be advantageous to renegotiate his contract now.
Under financial pressure from the COVID-19 crisis and with falling interest rates and a very likely recession in sight, he said, insurers could raise premiums even higher next year.
9 – After the COVID-19 episode, will insurers lower premiums to help their customers?
The specialists consulted by The bill doubt that insurers will continue to show as much flexibility.
According to them, it is very unlikely that your next premiums will be down … on the contrary.
In fact, the increase that many of you already noticed in your insurance premiums in early 2020 may even continue.
Why this increase? Insurers around the world have been facing profitability problems for several months because of low stock market returns and the rising value of claims, explains the RCCAQ.
Insurers therefore had to correct the situation, confirms Christopher Johnson:
%, 30%, up to 40% for individuals. For businesses, it was up to 200%. « , » text « : » For 2020, before COVID-19, this market correction meant an increase in premiums of 20%, 30%, up to 40% for individuals. For businesses, it was up to 200%. « }} » Lang = « en »>For this year 2020, before COVID-19, this market correction meant an increase in premiums 20%, 30%, up to 40% for individuals. For businesses, it was up to 200%.
There is no reason why the insurance companies would stop this increase in premiums. Insurers are currently below international capital standards.
This is because insurers have to back up their business with large sums of money to be able to sell insurance and to be able to reimburse possible claims. However, with the low stock market returns they derive from your premiums, they
have no leeway.
And the risks have not decreased, and the value of the constructions has not decreased.
Christopher Johnson agrees that this correction is still necessary to avoid the bankruptcy of insurers, and especially the loss of protection of their insured, but he implores insurers
to give people a break so they can absorb.
The future will tell us if it has been heard.
Isabelle Roberge is a research journalist on the show The bill
Find answers to your consumption questions in THE COVID-19 AND YOU section of The bill.