The pace of auto insurance rate increases in the U.S. slowed significantly in late 2024, but that didn’t stop a historic surge in consumers shopping for better deals, according to the J.D. Power 2025 U.S. Insurance Shopping Study.
Although premiums increased just under 2% at year-end -- down from a 13% spike at the beginning of 2024 -- the percentage of customers shopping for new insurance policies climbed to 57%, the highest in the study’s 19-year history.
“Auto insurance rate taking reached multi-decade highs in the first quarter of 2024, which put record numbers of customers into the market shopping for lower-priced policies as the year progressed,” said Stephen Crewdson, managing director of insurance business intelligence at J.D. Power. “As rate activity began to fall in the second half of 2024, many shoppers were successful at finding lower-priced policies.”
The study indicates this uptick in consumer activity may have created a “snowball effect,” encouraging further shopping even as prices stabilized. However, Crewdson noted the shopping rate is beginning to normalize.
Beyond pricing dynamics, the report highlights emerging shifts in consumer behavior:
• Bundling on the rise: Roughly one-third (33%) of active insurance shoppers are looking to bundle auto policies with homeowners insurance. These customers tend to remain longer with insurers -- 7.0 years on average versus 5.5 years for non-bundlers -- making them a valuable target for carriers.
• Embedded insurance gains traction: Interest in insurance provided directly by auto dealers, manufacturers, or financing companies is growing, with 37% of customers expressing interest. That figure jumps to 47% among Gen Y and Z respondents and 48% among those focused on service quality.
• Usage-based insurance (UBI) sees a rebound: Seventeen percent of insurers offered UBI options in 2025, up from 15% in 2024 but still below 2023’s peak of 22%.
In terms of overall customer satisfaction with the insurance shopping experience, Erie Insurance ranked highest among large insurers for the second straight year, scoring 714 points. ACG (AAA) followed with 707, and State Farm ranked third at 699.
The 2025 U.S. Insurance Shopping Study is based on responses from 12,720 customers who requested quotes from at least one competing insurer within the previous six months. The survey was conducted between April 2024 and January 2025.
