Pandemic Spurred Americans to Go Auto Insurance Price Shopping

Many turn to biggest insurers, hoping for better deals

The search for lower prices drove auto insurance consumer behavior more than any other factor in 2020, as the financial fallout from the Covid-19 pandemic roiled many U.S. households. Big auto insurance brand names benefited the most, according to the recently released J.D. Power 2021 U.S. Insurance Shopping Study.

Key Takeaways

  • The pandemic and its economic fallout caused many consumers to change their auto insurance policies or shop for better rates.
  • 17% reduced their coverage, 15% shopped for a new insurer, and 12% raised their deductibles.
  • 12% switched to another carrier, with the big brand name insurers gaining the most business.


Unemployment a Driving Factor

The U.S.'s 15% unemployment rate spurred many customers to shop around for policies with lower rates once the pandemic began, J.D. Power researchers found. 

Consumers who suffered a change in their finances due to the pandemic were largely responsible for a six-percentage-point increase in auto insurance policy shopping activity.

All told, 46% of auto insurance customers made some change in their policies in 2020. The most frequent change (17%) was reducing coverage, the study reported. That was followed by looking for a new insurer (15%), increasing deductibles (12%), or switching to another carrier (12%).  

Well-Known Brands Reaped the Rewards 

Familiar auto insurance brand names gained the most as customers shopped for better deals, with five largest insurers enjoying a 3% year-over-year increase in customer migration, the study noted.

Collectively, the top five insurers account for about 60% of all auto insurance premiums, according to the study.

These giants are, in order of premiums written: State Farm, Berkshire Hathaway Group’s Geico, Progressive, Allstate, and USAA, according to the National Association of Insurance Commissioners (NAIC)'s 2020 market share report. State Farm leads the pack with over 16% of the market.

Despite almost $10 billion in annual consumer advertising by the auto insurance industry, the migration was fueled primarily by previous awareness of companies and prices, J.D. Power said. Bargain hunting shoppers found little else to differentiate among companies.

But Customer Satisfaction Still Varies 

The J.D. Power study also looked at how satisfied consumers were with their insurers. Liberty Mutual and State Farm tied for the highest score among large insurers, with 872 points out of a possible 1,000. But Allstate, GEICO, and Farmers weren't far behind. The average for large insurers was 871. (USAA, which is not included in the rankings because of its membership requirements, scored a 902.)

Among midsize auto insurers, American Family topped the list with a score of 899, followed by Amica Mutual at 891. The average for that group was 858, showing a wider variation in satisfaction than with large insurers.

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  1. J.D. Power. "Auto Insurance Shopping Surged During Pandemic in 2020 but Little Brand Differentiation Apparent, J.D. Power Finds."

  2. National Association of Insurance Commissioners. "Top 25 Property/Casualty Market Share."