The California Department of Insurance announced today that businesses and consumers are entitled to an initial premium refund for March and April for certain types of insurance in response to the COVID-19 crisis. Insurers may comply with the premium refund order by providing a premium credit, reduction, return of premium, or other appropriate premium adjustment. (Please click here to see the department’s order.)
The Department said the following types of insurance would be eligible for premium refunds:
- Private passenger automobile insurance
- Commercial automobile insurance
- Workers’ compensation insurance
- Commercial multiple peril insurance
- Commercial liability insurance
- Medical malpractice insurance
- Any other line of coverage where the measure of risk have become substantially overstated as a result of the pandemic.
Marsh & McLennan Agency is working closely with clients to help reforecast revenue, payroll, risk and other assumptions which determine their premiums. Insurers will be required to issue the refunds as quickly as is “practicable,” but no later than 120 days, the Department said.
Additional developments are likely in coming weeks. Tomorrow, for example, the Workers’ Compensation Insurance Rating Bureau will consider three proposed rules that could have an impact on rates. We will keep you informed of additional developments as they arise.
The Marsh & McLennan Agency team has extensive resources and expertise to help during this period of uncertainty. Please feel free to contact your broker if you need immediate assistance, and check out our COVID-19 Resource Center HERE for ongoing updates and resources as they become available.