Erie Insurance Prevails in Ill. Federal COVID-19 Auto Premium Case

CHICAGO — An Illinois federal judge has dismissed a lawsuit accusing Erie Insurance Exchange of charging inflated auto insurance premiums during the early days of the COVID-19 pandemic, explaining that state public policy allows insurers to price their insurance based not just on risk but also on economic (i.e., market) factors.

In a Nov. 12 order, Judge Jorge L. Alonso of the U.S. District Court for the Northern District of Illinois explained that Erie was entitled to retain a premium that was calculated for a risk that changed, because something (namely, the pandemic) occurred after the policy was issued that …