“The current coronavirus outbreak will have lasting impacts on consumers' behavior regarding car insurance. While usage-based and on-demand car insurances are not that popular today, the current crisis will act as a catalyst to make them more popular”, said Russell Rabichev, Marketing Director
LOS ANGELES (PRWEB) May 04, 2020
Young adults are among the most affected groups financially by the current COVID-19 pandemic. Those who are about to enter the workforce are likely to have lower wages and will also have had less time to start building savings. 18-24 years old young adults have low levels of job security due to heavy presence in sectors like retail, leisure, and hospitality that were seriously affected by the coronavirus outbreak. Many of them are looking to make as many savings as they can. Car insurance is one area where customers look to save some money.
Most young adults have less than $1,000 in their savings account. While more and more states are imposing shelter-in-place restrictions and are instructing people to stay home, traditional insurance products like house insurance or boat are seeing a decline. Most people feel that they are less likely to be burgled during the COVID-19 outbreak.
While car insurance is difficult to cancel due to legal requirements, policy owners can make some adjustments to their policies and switch their comprehensive policies to usage-based or on-demand insurance in order to reduce costs. This move can be especially popular among young drivers who have to pay higher premiums due to their inexperience and their likelihood to be involved in accidents more often.
While this shift in behavior can be challenging for large insurance companies, small specialized insurers will benefit from the move. Usage-based car insurance providers will become more popular due to the fact their customers will pay less on their premiums when they are using their cars less often. Also, on-demand insurance companies will become more popular because they allow their customers to switch on and switch off their covers and pay only for the periods they need to be insured.
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