We can all agree the COVID-19 virus has flipped our nation on its side. Some industries seem to be thriving while others are floundering. Grocery stores are empty, children are finishing out their school year online, people are having to cancel vacations, and all non-essential medical appointments are postponed until further notice. In the meantime, bills are still due. Now the question becomes, what can be done to help navigate these unfamiliar waters? While we cannot speak to what banks, credit card companies, utility providers, etc. are and/or will be doing to help their customers, we can offer insight as to what actions some insurance carriers within the NEMT arena are taking during this pandemic.
Unfortunately, each insurance carrier is different and there isn’t one set action or accommodation to cover the NEMT industry as a whole. Over the past two weeks we’ve seen some carriers allow their insureds to complete a “Temporary Out of Service” form that essentially allows their insureds to list vehicles currently not running trips, and provides a premium reduction on said vehicles for the next 45 days. Other companies are relaxing their normally stringent requirements, allowing more flexibility for insureds to temporarily remove unused vehicles from their policy.
While the options mentioned above might seem to offer immediate relief, it may take longer than expected, and there are two primary reasons for this: First, normal turnaround time to process an endorsement (change to policy) can range anywhere from two weeks to 45 days (pending workflow of the insurance company). Second, the majority of insurance premiums in the NEMT industry are financed via a Premium Finance Company (lending companies for insurance premiums). It is very important to understand that premium finance companies are NOT insurance companies. If your insurance policy is financed through a premium finance company, credits for changes made to your policy have to be sent from the insurance company to the finance company and applied to your loan. Unfortunately, this process adds additional time to the “relief” company owners are looking for.
So, what do you need to do? The most important thing to do is be proactive. If you are in a position where you need assistance, don’t expect companies to reach out to you first. While everyone is doing their best during this time, the truth is, this pandemic is uncharted territory for all of us. Many companies that are able to remain in operation are doing so remotely, which again, is a new process for many people. Be proactive, take the first step. There are people ready and willing to assist you with whatever your specific situation may be.
We will make it through this pandemic. Our Country and our people are stronger than this virus. There are sure to be tough times in the upcoming weeks, but together we will successfully Navigate the COVID-19 Waters.
Your Sovereign Risk Team