As people across the country remain sheltered in their homes to prevent the spread of COVID-19, we’re seeing fewer drivers on the road.
Many drivers are limiting their trips to the grocery store or work if they’re essential employees. Some people may not even be driving at all, choosing to have food and supplies delivered or walking where they need to go to get some exercise and fresh air.
With the massive decrease in car use, you may be wondering: What’s happening to my car insurance? What about my other forms of insurance, like business insurance? Am I still covered in the same way, and will I be paid in a timely manner when I need it?
The team at Norton Frickey P.C. is here to answer your questions about the impact of coronavirus on your insurance policies below. If you have further questions about your insurance policy and rights, contact us online or call us at (719) 634-6450 for a free review.
Should I Cancel My Auto Insurance Policy?
If you’re not commuting to work or using your car to drive around town, should you cancel your car insurance? We say no.
If you’re still driving your car to pick up medicine or buy groceries, even if it’s as rare as once every few weeks, you still need to be covered by car insurance.
Colorado is one of many states with “financial responsibility” laws that require drivers to prove that they’re able to pay others in case of a car accident. Car insurance satisfies those laws. If you cancel your insurance and drive anyway, you can face fines, license suspension, or jail time if you’re caught.
Plus, if you get into a car accident while driving without insurance and it’s your fault, you can be held personally liable for the damages. Even if you’re not at fault, you may not be compensated for your vehicle‘s damage to if you don’t have insurance.
Thinking about lowering your premium by dropping optional coverage, like collision and comprehensive insurance? It may save you money in the short term, but remember that you won’t be covered in case of problems like theft, falling objects, or collision with animals. Colorado’s hail storms, in fact, were the most expensive in the country in 2018.
The good news is, some insurers are planning to refund a percentage of premiums paid by their customers in the months to come. More insurers may follow suit.
Will My Business Be Covered by Insurance?
If you temporarily closed your business in response to the coronavirus, you might have looked into filing an insurance claim to cover your losses. After all, many businesses have policies that cover damages from natural disasters like fires, hurricanes, earthquakes, or flooding.
However, those three examples have one thing in common: they cause physical damage to a business. A virus or disease outbreak does not. That reasoning is being used by many insurers to avoid paying out claims on business interruption insurance policies.
In fact, some policies specifically contain clauses excluding cases of viruses and bacteria, which have been added after outbreaks of other recent epidemics like SARS and Ebola. It’s also why terrorist acts are usually not covered either following 9/11.
Rectifying this insurance coverage is being discussed at the state and federal level. While health insurance is top priority due to the impact of COVID-19, the Colorado Division of Insurance is looking into other insurance issues related to businesses, property, and casualty insurance.
What Can I Do About My Insurance Policies?
Thoroughly read and review your insurance policies. Even if your insurer isn’t refunding a percentage of your paid premium, it’s still a good idea to call your insurance company to talk about your situation. Ask about possible discounts, a grace period for delayed payments, or changes you can make to save money.
It’s clear that many insurers have taken proactive steps to avoid paying out, even in the midst of a global pandemic that impacts everyone. If you’ve tried contacting your insurer and been ignored or felt that speaking to your insurer was in vain, our attorneys at Norton Frickey P.C. can help.
Norton Frickey P.C. represents clients throughout Colorado in areas like bad faith insurance, motor vehicle accidents, and more. Fill out our contact form online or call us at (719) 634-6450. You can also follow us on Facebook and Twitter for news updates, resources, and blog posts.