Instant Progressive rule change could cut car insurance rates faster

Progressive is temporarily changing its Snapshot program in an effort to help reduce auto insurance rates for its customers during the Covid-19 pandemic. Snapshot is a usage-based insurance (UBI) program that can result in better rates for drivers with good driving habits.

Snapshot uses either a device installed in your car or a mobile app to track your driving behaviors. Snapshot measures rapid acceleration, hard braking, miles traveled and time of day. For customers using the phone app, it also measures phone use while driving.

Once you complete a measurement period, you will get a driving score and qualify for a car insurance discount.

Progressive’s snapshot review period is usually at least 75 days. But the company is temporarily allowing Snapshot customers to choose a shorter review period of at least 30 days for pricing recalculation. If a client is happy with their results, Progressive will immediately apply the new Snapshot pricing. Customers won’t have to wait for their next policy renewal to receive a rate reduction.

Even if a current Snapshot customer has completed a review period, they may choose to monitor again to try and get a better rate based on their driving safety score. (Note that your rate could also increase under the Snapshot program if your driving isn’t good.)

In documents filed with state insurance services, Progressive said adjusting measurement periods “is a highly manual process and will require specially trained customer service representatives to operate effectively and efficiently.”

Documents filed by Progressive indicate that customer service representatives will be able to advise customers on whether a shorter review period is the right option for them. Snapshot customers do not need to take a shorter review period, and participation in Snapshot is optional for Progressive customers.

New customers can also sign up for Snapshot and take advantage of the shorter measurement period.

Progressive’s insurance records indicate that the company considered other alternatives for rate reductions, but the 30-day watch period was chosen for two reasons: 1) it has the potential to benefit the greatest number customers and 2) it can be implemented quickly.

The temporary rule for a reduced review period is generally expected to come into effect from early February until July 31, 2021.

New rules for the pandemic

Progressive’s temporary rule is one of the latest moves by car insurance companies to provide customers with rate relief during the Covid-19 pandemic. During the early months of the pandemic, many insurance companies offered relief in the form of car insurance reimbursements, primarily due to a significant drop in the number of miles driven. With less traffic on the road, there were fewer car accidents and fewer insurance claims.

National daily commutes have leveled off since June 2020, compared to the initial decline in driving from March to May 2020, according to “Hindsight is 2020: A Year in Review,” a report by Arity, a company mobility data and analytics company that provides data to car insurance companies. Arity reports that the total number of daily trips is almost back to pre-pandemic levels.

Other Ways to Lower Auto Insurance Rates

Even though daily driving is approaching normal pre-pandemic levels, those who don’t drive much might be interested in another alternative to traditional car insurance policies: pay-per-mile car insurance. In this model, you will pay a base daily or monthly rate plus a per kilometer rate. The fewer miles you drive, the lower your car insurance bill will be each month.

But pay-per-mile isn’t for everyone. For example, if you plan to resume a daily commute in 2021, pay-per-mile might end up costing you more than a traditional policy if you start racking up a bunch of miles.

If you don’t want to switch to a UBI plan or pay per kilometer, there are other ways to save on car insurance:

  • Ask for a discount. There are many car insurance discounts, some of which can save you up to 25% on your bill, such as bundling car and home insurance. You may be eligible for other discounts such as multi-car discounts, car security discounts, anti-theft discounts, and good driver discounts.
  • Look for a new car insurance company. If you are not satisfied with your rates, you can change insurer. Shopping and comparing car insurance quotes will reveal if you are paying too much. But price isn’t everything, so be sure to find a company with reasonable rates and good service. Here are Forbes Advisor’s ratings of the best car insurance companies.

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