Shifting Shopping Trends Could Reset the Auto Insurance Leaderboard

New J.D. Power data tool predicts brisk competition for customers at state level

The nationwide auto insurance shopping frenzy of last year is cooling down, but a more competitive state-by-state race for customers is heating up, suggest findings from a newly launched J.D. Power data tool—detailed this week in Insurance Journal.

Key Takeaways

  • A new tracking metric launched by J.D. Power reveals changing market trends and real-time customer shopping patterns for auto insurance, as reported in Insurance Journal.
  • Consumers looking for better deals during the pandemic searched or switched carriers more often—driven by savings and convenience.
  • As competition intensifies at the state level, a J.D. Power executive predicts a “battle for auto insurance supremacy.”

Pandemic-Fueled Shopping Surge Normalizes

For years, consumers have shopped and switched auto insurance brands frequently. J.D. Power’s 2020 U.S. Insurance Shopping Study, in fact, found that 77% of auto insurance customers either actively shopped for a new carrier pre-pandemic or were prompted to comparison-shop because of poor service or rate hikes.

The pandemic intensified that activity—driven largely by customers looking to trim expenses. In the early part of the pandemic, shopping activity grew about 20%, according to J.D. Power’s Loyalty Indicator and Shopping Trends (LIST). This new shopping tracker gives a competitive view of daily auto insurance shopping activity across the top 25 auto insurance brands at the national and state level. It can gauge, in real time, where companies are winning and losing when it comes to acquiring customers.

"Underlying data for J.D. Power Auto Insurance LIST is drawn from daily surveying of 500-1,000 auto insurance customers sourced by SurveyMonkey’s market-leading platform," J.D. Power explained in a February launch announcement.

Now, as shopping patterns return to more normal levels nationally, acquisition battles will increasingly move to the states, writes Tom Super, head of P&C Insurance with J.D. Power. For insurers, these shifts could shake up the property/casualty leaderboard. And consumers should expect more competition for their business in certain key regions of the country.

Regions Likely to See the Most Activity

Where are the top battlegrounds expected to be? The J.D. Power data on shopping activity by region predicts states in the South and Southwest are poised for change, according to Super’s column.

Almost like a political vote-counting roadmap, the LIST tracker illustrates which carriers are landing the most quotes by state with a daily and monthly tally. In Texas, for example—where top market spots are split by less than two points among the top four auto insurers, Super says—Allstate has moved to the front, capturing nearly 28% of all quote volume during the last three months, as measured by the LIST tracker. And in Georgia, GEICO’s growth captured nearly 25% of all quote volume in the three-month period.

Overall, between November 2020 and February 2021, LIST shows that GEICO captured the most quote activity in 18 states, followed closely by market share leader State Farm with high activity in 16 states, Progressive in seven, and Allstate in three.

The Bottom Line

“As national shopping activity stabilizes in 2021, it sets the stage for another big pivot for insurers to local markets in their battle for customer courtship,” Super predicts. “It could make this year a landmark event in the battle for auto insurance supremacy.”

Article Sources
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  1. Insurance Journal. "Auto Insurance Shopping Stabilizes, State-Level Competition Intensifies: J.D. Power."

  2. J.D. Power. "2020 U.S. Insurance Shopping Study."

  3. J.D. Power. "J.D. Power Launches Real-Time Auto Insurance Customer Loyalty Tracking Capability."

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