For the first time, a majority of new buyers of auto insurance initiated their policy purchase by applying for a rate quote online, according to the J.D. Power and Associates 2011 U.S. Insurance Shopping Study. The study indicates 54% of new buyers request their initial quote online, up 23% from 44% who did so in 2007.
Policy Churn Grows
The study also finds that the rate of policy churn in the US market has increased during the past two years, returning to levels not experienced since 2008. This is driven both by an increase in the rate of shopping among insurance customers, which averages 33% in 2011 (up 22% from 27% in 2009 and 10% from 30% in 2010), as well as a significant increase in the rate of switching companies among shoppers. Among insurance customers who indicate shopping for insurance in 2011, 40% switched to a new insurer, up 21% from 33% in 2010.
American Family Ranks Highest in New Buyer Satisfaction
With a score of 864 on a 1,000-point scale, American Family Insurance ranks highest among auto insurance companies in satisfying new buyers with the purchase experience. American Family performs particularly well in the policy offerings and distribution channel factors, primarily driven by the performance of their exclusive agents. Rounding out the top three are Auto-Owners Insurance with an overall average satisfaction score of 860, and Erie Insurance with 857.
The study examines consumer shopping and purchasing behaviors and overall satisfaction among buyers who recently purchased from an auto insurance provider across three factors (in order of importance): distribution channel; policy offerings; and price.
Allstate Humor Draws Younger Drivers
The study also includes a management discussion that takes a closer look at the recent use of humor by Allstate and its key competitors, State Farm, GEICO and Progressive, to try to differentiate themselves and appeal to younger consumers. While comedic advertising such as Allstate’s “Mayhem” campaign have generated tremendous buzz in the marketplace and have led to higher unaided awareness and consideration rates, J.D. Power analysis indicates quote rates for Allstate have increased by only two percentage points.
However, Allstate is the only brand among these four that has achieved growth in its quote rate among the two younger age cohorts. In contrast, other insurers are quoting an average of three percentage points fewer for Millenials and Gen X shoppers, compared with one year ago.
comScore: Online Auto Insurance Activity Remains Strong
In 2009, online quote submission and purchasing saw dramatic increases of 21% and 22%, respectively, and this activity was maintained in 2010, according to the comScore 2011 Online Auto Insurance report. There were only minimal changes in the number of quotes submitted (down 3%) and the volume of insurance purchases made online (up 1%).
About the Data: The 2011 U.S. Insurance Shopping Study is based on responses from more than 15,500 shoppers who requested an auto insurance price quote from at least one competitive insurer in the past 12 months and includes more than 75,500 unique insurer evaluations. The study, published by J.D. Power & Associates, was fielded from March to April 2011 and is the source of the enclosed charts.
