Auto and property insurance shopping rates continued to rise in Q1
2023, up 7% and 10%, respectively, compared to Q1 2022. However, as
shopping has increased, the number of consumers switching carriers
is beginning to decrease, indicating that premiums are rising among
virtually all insurers.
The findings are part of TransUnion’s (NYSE: TRU)
latest quarterly Insurance Personal Lines Trends and
Perspectives Report, which includes trends in the auto and
property insurance industries, as well as survey data about
consumers’ behaviors and attitudes.
The survey found nearly 15% of consumers owned or
used a vehicle without valid coverage or had allowed their coverage
to lapse within the past six months. This was likely among
higher-risk consumers (with a credit-based insurance score between
300 and 500), as that segment’s year-over-year percent change in
shopping dropped into negative territory, despite the overall
increase in auto insurance shopping.
“Insurers have shifted their focus from customer
acquisition to profitability and are generally raising their
rates,” said Mark McElroy, executive vice president and head of
TransUnion’s insurance business. “As consumers have found it more
difficult to find a lower premium through online shopping, they are
changing behaviors in response.”
An opportunity for
agentsDigitalization has made online shopping for
insurance far easier, however, consumers are finding their price
options are not very different at the moment. As a result, there
was a 25% increase in the number of consumers who say they have
reached out to an agent to assist with their insurance
shopping.
The report notes that consumers are seeking out
agents for guidance on how to find opportunities for savings
through bundling, as well as how to get the most value out of their
policies. With the right marketing intelligence support, like
TruAudience™ Audience solutions, for identifying the consumers most
likely to be shopping, insurers can increase proactive outreach
with the value proposition of a more comprehensive assessment of a
consumer’s insurance needs.
In addition, insurers can equip their agents with
an advantage in finding a more receptive audience by enabling
TruContact™ Branded Call Display (BCD), Powered by Neustar®, on
outgoing phone calls. Solutions like BCD make it possible to
display the company name, logo, and reason for the call.
“Insurance agents’ relationships with customers are
built on trust,” said James Garvert, senior vice president and
general manager for TransUnion’s TruContact™ Communications
solutions. “With Branded Call Display, agents can reinforce that
sense of trust with every call they make by providing additional
context and verification that help customers feel confident about
answering the phone.”
More consumers pass on
telematicsDespite a strong desire to find lower premiums,
fewer consumers are opting for telematics programs. According to
the report, the number of consumers who accepted a telematics offer
was 12 percentage points lower than a year ago, from 65% to
53%.
The report posits a couple possible explanations
for the decrease; one being that consumers are driving more this
year as more employees return to working in the office. Some may be
nervous about the increased risk of being penalized for driving
mistakes. In addition, the telematics programs have changed,
becoming more complex and often delaying discounts until after a
trial period has been completed.
“Until recently, most telematics programs offered
upfront discounts simply for opting in,” said Michelle Jackson,
senior director of personal property and casualty insurance in
TransUnion’s insurance business. “Many of these programs now
require consumers to download an app that tracks their driving
behavior and to keep it installed for several months before they
are eligible to earn the discount. Given that consumers might still
see an increased rate due to their driving behavior, it seems that
fewer are willing to risk an even higher premium.”
Homeowners also looking to
saveSimilar to the auto insurance market, property
insurance shopping increased in Q1 2023. However, with high
mortgage rates and home prices, shopping activity was driven by
homeowners looking for lower rates rather than coverage for a new
home.
The report identifies this trend as a red flag for
carriers, as homeowners are likely investing in renovations in lieu
of a new home purchase. This can result in a mismatch of coverage,
as additions and other significant changes may not be covered in
the homeowners’ existing policies.
“With consumers increasingly looking to their
agents for guidance on savings, right now is an ideal time for
outreach,” said Jackson. “Agents can use the conversation to offer
insights on how bundling policies may help lower premiums, while
finding out if there have been any material changes to insured
properties.”
For additional insights into the personal lines
insurance marketplace, the full report can be
accessed here.
About TransUnion’s Insurance Personal Lines
Trends and Perspectives ReportThis quarterly publication
examines trends in the personal lines insurance industry, including
shopping, migration, violation, credit-based insurance stability
and more. The Trends and Perspectives Report research is based
entirely on TransUnion’s extensive internal data and analyses. It
includes information on insurance shopping transactions from
October 2021 to March 2023. However, the report excludes shopping
data from insurance customers in California, Hawaii (auto),
Massachusetts (auto), and Maryland (property), where credit-based
insurance scoring information is not used for insurance rating or
underwriting.
About TransUnion (NYSE:
TRU)TransUnion is a global information and insights
company with over 12,000 associates operating in more than 30
countries. We make trust possible by ensuring each person is
reliably represented in the marketplace. We do this with a Tru™
picture of each person: an actionable view of consumers, stewarded
with care. Through our acquisitions and technology investments we
have developed innovative solutions that extend beyond our strong
foundation in core credit into areas such as marketing, fraud, risk
and advanced analytics. As a result, consumers and businesses can
transact with confidence and achieve great things. We call this
Information for Good® — and it leads to economic opportunity, great
experiences and personal empowerment for millions of people around
the world. http://www.transunion.com/business
Contact |
Dave BlumbergTransUnion |
E-mail |
david.blumberg@transunion.com |
Telephone |
312-972-6646 |
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