J.D. Power and TransUnion Determine Auto Insurance Consumers are Shopping and Switching
According to an article in Insurance Journal, J.D. Power and TransUnion are seeing an uptick in consumers shopping around for their auto insurance, and ultimately switching carriers.
Chad Hemenway writes, “According to a quarterly report from J.D. Power, in collaboration with TransUnion, the quote rate for auto insurance in the fourth quarter 2022 was 12.1% and the switch rate was 4.1% – both are highs in the more than two years J.D Power has been doing the quarterly loyalty indicator and shopping trends (LIST) report.”
We think it’s safe to assume that consumers are looking to lower their rates to save money where they can in today’s economic climate.
What’s also interesting to note is that the report shows telematics, a method used to collect information about mileage and driving habits, has stabilized. Hemenway writes, “Most consumers who opted in to a telematics program were satisfied, but more than 40% said their rates actually went up.”
Additionally, Michelle Jackson, Senior Director of Personal Lines Market Strategy at TransUnion, stated that, “The value proposition of telematics is that consumers give up some sense of privacy or autonomy to provide insurers a demonstrably safe driving record in real-time. If they’re not seeing that translate into lower rates, or if their rates actually increase, some may not continue with the program.”
Furthermore, J.D. Power noted that insurers are decreasing spending in advertising for the purpose of keeping unprofitable business down.
This is certainly something to keep our eye on throughout 2023.