Policy Reductions
More than one-third of Americans eliminated one insurance policy in 2020, but those out of work because of COVID-19 were much more likely to shed coverage. The news comes as workers’ compensation insurance cases related to the pandemic are rising and homeowners insurance companies are ready to resume policy cancellations and nonrenewals. It’s all in this week’s digest of coronavirus news impacting the Florida insurance marketplace.
Photo by Gladson Xavier from Pexels
Losing Coverage: A new ValuePenguin survey shows almost 40% of Americans reduced or eliminated an insurance policy last year as a way to save money. Health insurance was the most common target, followed closely by auto and then dental insurance. Many fewer shed homeowners insurance. Those without jobs did it as a necessity, with 65% cutting back or canceling coverage. Florida’s unemployment claims in the first week of the New Year tripled, reaching their highest level since August. The survey noted about 60% regretted the decision with 52% saying they plan to restore their plans once things get better.
Workers’ Compensation: While a number of states have expanded access to workers’ compensation benefits for employees who’ve contracted COVID-19, the impact on insurance companies’ so far overall in negligible. A new study by the Workers Compensation Research Institute (WCRI) looked at 27 states, including Florida, and found significant decreases in the number of non-COVID claims. But states varied greatly on the number of COVID claims, with northeastern states reporting a higher percentage of such claims, especially in the healthcare field.
MyNewMarkets.com reports that a large number of COVID claims in Florida, Texas and California are being offset by the decline in non-COVID claims attributed to employees working from home. The Florida Division of Workers’ Compensation report through October 2020 shows that 23,452 COVID claims had been filed with $17.4 million in benefits paid. They made up 31% of all indemnity claims in Florida.
Homeowners Impact: Citizens Property Insurance Corporation reports that it will resume in-process policy cancellations and nonrenewals of property insurance policies beginning February 1. The carrier had previously extended a temporary moratorium on such actions that began at the start of the coronavirus pandemic last March. After February 1, Citizens will only make hardship exceptions to those policyholders who continue to be affected by loss of employment, diminished wages or business income, or other monetary loss from the state of emergency and that directly impacts the ability of a policyholder to make their payments.
LMA Newsletter of 1-18-21
