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Canadian auto insurers are extending pandemic relief for drivers as the industry faces criticism for not doing enough to financially support customers.

Desjardins Group announced last week it is set to pay an additional $100-million in premium refunds to auto insurance clients. The Quebec-based property and casualty insurer unveiled the relief measures after Ontario Finance Minister Rod Phillips publicly identified the company as an industry player that was not “stepping up” with enough premium relief for clients.

“Since COVID-19 started, our government has been keeping a close watch to make sure insurance companies are treating the people of Ontario fairly during this unprecedented time,” Mr. Phillips said in an e-mail to The Globe and Mail. “My message to insurance companies has been clear from the beginning: You should provide relief that reflects the financial hardships your customers are facing because of COVID-19.”

In April, Mr. Phillips, along with the province’s Financial Services Regulatory Authority, implemented a regulatory change allowing auto insurers to provide premium rebates for clients for up to 12 months.

At that time, Desjardins initially refunded almost $50-million to auto insurance clients who called in to request a rebate. Now, the company will automatically refund between 25 per cent to 40 per cent of one monthly premium for all eligible personal and commercial auto insurance clients.

What you need to know about managing your finances during the pandemic

Last month, Allstate Insurance Co. of Canada, together with its subsidiaries Pembridge Insurance Co. and Pafco Insurance Co., announced a second relief payment of $30-million to all its personal auto insurance customers. The additional rebate brings the total amount of premiums returned to clients to $60-million. Clients with active automobile policies as of July 6 will receive a cheque for a one-time payment of about 25 per cent of their monthly premium.

“Many of our customers are driving less, so offering this second payment back to them is simply the right thing to do,” Allstate chief executive Ryan Michel said in a statement.

At the onset of the coronavirus lockdown this year, several major auto insurers began to offer payment deferrals and monthly premium rebates as it became clear there was a reduction in risk for auto insurers with fewer cars on the road.

More than 74 home and auto insurers, who are members of the Insurance Bureau of Canada, also jointly agreed to eliminate all non-sufficient funds fees that may occur on payments during the pandemic, while implementing 90-day payment deferral options and offering flexible payments for some vulnerable clients or those facing financial hardship.

Now, as those 90-day time frames are set to expire, TD Insurance announced it is extending its home and auto pandemic relief measures until Aug. 31. The insurer was previously set to automatically reverse its temporary changes on July 16.

Customers now have until the end of August to apply for a 90-day deferral to their auto insurance premium. As well, any existing clients who have temporarily stored their vehicles or have reduced their driving will see their premium reductions automatically continue until Aug. 31.

“We continue to be one of the only industries that are really giving cash directly back to the customer,” TD Insurance CEO Ray Chun said in an interview. “We are putting cash back in consumers’ pocket and that is an important point during these times.”

Despite the criticism that auto insurers need to do more, Mr. Chun said the overall sector was “quite quick” to help Canadians as they are driving less.

“As an entire industry, auto insurers were initially looking to give back about $600-million across the country and as COVID continued, together – as an industry – we have done much more than that,” he added.

In June, FSRA reported Ontario drivers had received $685-million in total premium relief in the form of premium deferrals, rebates, refunds, rate reductions and other measures during the COVID-19 emergency. However, FSRA says it found “divergent” levels of relief among different insurers and as a result will continue to monitor how insurance companies are responding to client needs.

“[Our] interest is ensuring that public confidence is maintained, that rates are demonstrably just and reasonable and that consumers are treated fairly through the combined total of an insurers premium rebating programs, rate reductions or other forms of relief,” FSRA spokesperson Malon Edwards said in an e-mail.

Other major insurers, such as Aviva Canada and Intact Financial, are asking clients who continue to experience financial stress because of COVID-19 – and need to extend payment arrangements beyond the 90-day relief period – to call their insurance agent or broker.

“As provinces reopen, businesses restart and more cars get back on the roads, we will be returning some of our business practices to normal [as of] July 1,” Aviva CEO Jason Storah said in an e-mail.

Aviva Canada was among the first insurers to announce relief measures for drivers in April and has provided more than $115-million in total relief, while Intact has provided more than $310-million of relief for more than one million clients, as of the end of June.

COVID-19 relief options from some major auto insurers

Some of Canada’s largest auto insurers have provided relief for clients during the pandemic, but the scope and details vary.

Aviva Canada:

Customers who have stopped driving entirely can reduce monthly auto insurance premiums by up to 75 per cent. Customers who are driving less may be eligible for monthly savings up to 15 per cent. Premium payments can be deferred for up to 90 days without penalty.

Aviva will also waive non-sufficient fee charges for those unable to make payments and will continue to provide coverage. In addition, premium increases have been frozen for 12 months for all renewals that were done on or after April 17.

Allstate Insurance Co. of Canada:

Allstate customers – and clients of subsidiaries Pembridge and Pafco – who held active automobile policies as of April 8 all qualified to receive a one-time payment of approximately 25 per cent of their monthly auto premium. The first rebate cheques were mailed out in May. A second relief payment of $30-million was announced in mid-June. Clients who have active automobile policies as of July 6 will qualify to receive another one-time payment of approximately 25 per cent of their monthly auto premium. Rebate cheques will be mailed out in August.

Allstate has also extended insurance coverage until Aug. 31 for customers who use their personal vehicles to deliver food, medicine and groceries for commercial purposes – uses that are typically excluded from coverage.

TD Insurance:

Beginning in mid-March, TD offered auto insurance payment deferrals for up to three months. Applications for a deferral will now be accepted until Aug. 31. Clients who choose to reduce their driving can save up to 15 per cent on monthly premiums, while drivers who choose to park their vehicles temporarily during the pandemic may qualify for a rebate of up to 75 per cent. Customers who have already deferred premium payments for three months are not eligible to further defer.

In addition, TD has extended the elimination non-sufficient funds penalties on auto insurance payments through to Aug. 31. If a customer continues to experience financial difficulties because of COVID-19, and needs to extend relief, it will be reviewed on a case-by-case basis.

Intact Financial:

Auto insurance customers can qualify for financial relief by updating information about their driving habits either online or with their insurance broker until July 31. Personal auto customers who are driving less may be eligible for up to 15 per cent reduction in their premiums for three months to reflect changes in driving. Customers who have stopped driving entirely can reduce monthly auto insurance premiums by up to 75 per cent for as long as the vehicle is parked.

La Capitale and SSQ:

La Capitale and SSQ Insurance offered a reduction for a three-month period ending June 30. As the province of Quebec begins to reopen, both insurers confirmed there would not be an extension on COVID-19 relief measures. However, clients who still use their vehicle less than usual can contact the insurer to temporarily change the annual mileage they had previously declared.

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