Auto insurance coverage customers proceed to modify carriers, report finds

LexisNexis has launched its Insurance coverage Demand Meter report, sharing the corporate’s evaluation of the auto insurance coverage purchasing traits within the US within the first quarter. 

In accordance with the quarterly findings, shopper auto insurance coverage purchasing exercise was marked as “scorching” on the LexisNexis Insurance coverage Demand Meter, with a 2.9% year-over-year improve in looking for Q1 2024. This represents a slight deceleration from the earlier quarter’s 4.7% year-over-year progress.

New coverage acquisitions, in the meantime, skilled a “scorching” hike, rising by 8.7% in Q1 2024, up from the 7% soar noticed within the prior quarter. This marks the seventh consecutive quarter and the twentieth straight month of accelerating new coverage progress, indicating a seamless development of customers switching carriers extra often.

Regardless of March displaying a touch decrease purchasing progress price in comparison with the earlier 12 months – probably because of fewer workdays and extra weekends than in 2023 – 42% of insured households shopped for auto insurance coverage within the final 12 months.

Since 2021, the section of customers more than likely to stay with their present insurer (these loyal for greater than 10 years) has grown. This group made up lower than 20% of customers initially however has now expanded to 24% of the overall shopper pool via Q1 2024.

The market additionally noticed an inflow of recent drivers within the quarter, balancing out the variety of these exiting. It is a notable change from 2022 and 2023, when a big variety of customers left the market because of rising premiums.

Adam Pichon (pictured), senior vice chairman for international analytics at LexisNexis Threat Options, famous: “As now we have seen extra purchasing in current months from customers who’ve historically been longer-tenured and extra loyal, insurers with an urge for food for progress should have a chance to capitalize as these customers search to decrease their premiums.

“Insurers can also wish to contemplate implementing stronger retention methods as they search to return to price adequacy and profitability, together with extra proactive and selective monitoring of their renewal books to assist id and retain these loyal policyholders.”

Based mostly on billions of shopper purchasing transactions since 2009, the LexisNexis Insurance coverage Demand Meter is a quarterly evaluation of purchasing quantity and frequency, in addition to new enterprise quantity and associated information factors, aimed toward providing a market-wide perspective of shopper purchasing and switching conduct.

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