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Monday, 22 November 2021 17:05

U.S. Auto Annual Insurance Shopping Rate Decreased in Q3

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The latest edition of the LexisNexis® Risk Solutions Insurance Demand Meter reports the overall annual U.S. auto insurance shopping growth rate decreased to -3.9% for Q3 2021.

New policy growth also reached a two-year low, dropping to -7.3% for the quarter. While negative growth rates have been rare over the past decade, decreases in new business policy growth followed the downward trend that began in May and June as the insurance industry continues to face unparalleled circumstances and economic factors.  

 

"Insurance shopping in Q3 returned to levels that compare to 2019 and years prior rather than following the unusual trends of 2020," said Adam Pichon, vice president of personal lines insurance at LexisNexis Risk Solutions. "Prior quarters this year were fueled by consumers returning to normalcy, but that pattern was tempered by macroeconomic and carrier-driven factors that began impacting the market in Q2 and carried over into the third quarter."   

 

Market Forces Impacted Q3 2021 Shopping

 

More consumers stayed with their current insurance carrier than in previous quarters, compared to the same time last year. Several micro and macroeconomic trends impacted insurance shopping in Q3, including:

 

Global microchip shortages fueled new car inventory shortages and rising costs for used cars meant fewer overall new and used car purchases, which typically account for one in three shopping events.


Claims frequencies have increased with drivers returning to the roads, which can lead to insurance carriers filing for rate increases and decreasing marketing spend to address profitability challenges. In some states where regulators have not approved increased rates, decreased carrier marketing spend is notable.


State-issued moratoria on policy cancellations were lifted, which may have caused...


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