BLOOMINGTON (HOI) - Bloomington's State Farm Insurance is looking to cut auto rates nationwide by about $2.2 billion because people are driving less during the COVID-19 pandemic.
The nation's largest auto insurer announced Monday it plans to reduce rates by 11 percent, although rate changes in some states are subject to regulatory approval. Also, customer rate reductions might vary based on individual renewals, the company said.
“Current State Farm driving data and claims experience show a considerable decline in miles driven and fewer accidents,” State Farm Senior Vice President Kristyn Cook-Turner said in a prepared statement.
“As a result, we’re looking for ways to continue supporting our customers while we monitor and adjust to trends,” Cook-Turner also said.
Approximately $2.2 billion in rate cuts follow State Farm's announcement April 9 that it was returning a $2 billion dividend to auto insurance customers as part of the company's Good Neighbor Relief Program. At the time, State Farm also said it was offering "flexible customer payment options and philanthropic relief."
"With schools and businesses closed, and many of us sheltering in our homes, people are driving less right now, so we’re returning value to customers as we anticipate fewer auto claims," the company said.
State Farm said the dividend was the largest paid to customers in the company's history.