Auto Insurance Shopping Reaches New High in Q1 2024
The number of U.S. consumers shopping for auto insurance reached a five-year Q1 high in Q1 2024, rising 6% YoY, according to TransUnion (NYSE: TRU). This growth is significant in the West and Midwest regions, driven by increased living costs and inflation. Despite this growth in auto insurance shopping, property insurance shopping remained flat at 0% YoY, affected by high mortgage rates around 8%. TransUnion anticipates a potential decrease in mortgage rates to 6.4% in 2024, which might boost property insurance shopping. The report suggests that as insurers see improved profitability, they may increase investments in customer acquisition, focusing on demographics like Gen Z and Millennials. This is supported by TransUnion's TruAudience® solution, which aids in identifying and reaching the best consumer audiences.
- Auto insurance shopping increased by 6% YoY in Q1 2024, marking a five-year Q1 high.
- Consumers from the West and Midwest showed significant auto insurance shopping activity.
- 23% of consumers plan to purchase or lease a vehicle within the next 12 months, up from 17% in 2023.
- Insurers are expected to see improved profitability, potentially increasing investments in customer acquisition.
- Property insurance shopping remained flat at 0% YoY in Q1 2024.
- High mortgage rates, approaching 8%, have dampened the housing market, affecting property insurance shopping.
- Rising costs of living and inflation continue to strain consumer finances, particularly in the West and Midwest.
Insights
The recent increase in auto insurance shopping, up
The differentiation in regional consumer behavior—particularly the active insurance shopping in the West and Midwest—highlights the influence of local economic conditions on consumer choices. Rising costs of living and increased premiums have driven these regions to seek alternative insurance options. This regional disparity necessitates that insurers adopt geographically targeted marketing strategies to more effectively reach potential customers. Additionally, understanding the demographic trends, such as the higher activity among younger generations like Gen Z and Millennials, can help insurers fine-tune their product offerings and marketing campaigns.
High interest rates have a dual impact on the insurance market. While they dampen property insurance shopping due to reduced home buying activities, they may indirectly spur auto insurance shopping as more consumers opt to maintain and insure their current vehicles rather than investing in new homes. The expectation of interest rates falling to
TransUnion report finds U.S. consumers in the West and Midwest states drove auto and home insurance shopping in first quarter of 2024
CHICAGO, May 21, 2024 (GLOBE NEWSWIRE) -- The number of U.S. consumers who shopped for auto insurance in Q1 2024 increased by
This trend bolsters hopes that the personal lines insurance industry will move toward profitability in 2024. However, the current high interest rate environment continues to strain consumers’ wallets and dampen the housing market, which creates challenges for property insurance carriers. These insights and more are part of TransUnion’s latest quarterly Insurance Personal Lines Trends and Perspectives Report.
“As insurers see improved profitability, it’s likely that some will cautiously increase investments in customer acquisition,” said Stothard Deal, vice president of strategic planning for TransUnion’s insurance business. “It will be paramount that they maximize those investments by identifying the best audiences, based on their likelihood to purchase as well as their overall risk levels.”
Shopping by geography
The report found consumers from the West and Midwest regions were particularly active in Q1 2024, marking a shift from the previous year when all regions, except the Northeast, had proportionately equal change in the numbers of auto insurance shoppers. Rising costs of living in both regions were likely the motivating factor.
The Midwest, which has historically had the lowest average premiums, experienced the most significant rate increase in the past two years. In addition, lower income levels and inflation have consumers in this region looking for ways to save money.
Consumers from states in the West are already accustomed to higher costs of living but have experienced increasing pressure from inflation. In addition, carriers have raised premiums or implemented underwriting restrictions, forcing many to shop for alternatives.
On a positive note, consumers are still eager to purchase new and used vehicles, which will also benefit auto insurance shopping. Approximately
Interest rates suppress property insurance shopping
While auto insurance shopping increased in Q1 2023, property remained flat at
The report notes that industry experts expect rates to come down to
Leveraging this kind of demographic data, along with other consumer attributes, can help insurers find their best audiences for marketing campaigns. TransUnion’s TruAudience® solution line provides robust identity-based data to reach consumers most likely to convert.
Click here to read the latest Insurance Personal Lines Trends and Perspectives Report.
About TransUnion’s Insurance Personal Lines Trends and Perspectives Report
This quarterly publication examines trends in the personal lines insurance industry, including shopping, migration, violation, credit-based insurance stability and more. The Trends and Perspectives Report research is based almost entirely on TransUnion’s extensive internal data and analyses. It includes information on insurance shopping transactions from October 2022 to March 2024. However, the report excludes shopping data from insurance customers in California, Hawaii (auto), Massachusetts (auto), and Maryland (property), where credit-based insurance scoring information is not used for insurance rating or underwriting.
About TransUnion (NYSE: TRU)
TransUnion is a global information and insights company with over 13,000 associates operating in more than 30 countries. We make trust possible by ensuring each person is reliably represented in the marketplace. We do this with a Tru™ picture of each person: an actionable view of consumers, stewarded with care. Through our acquisitions and technology investments we have developed innovative solutions that extend beyond our strong foundation in core credit into areas such as marketing, fraud, risk and advanced analytics. As a result, consumers and businesses can transact with confidence and achieve great things. We call this Information for Good® — and it leads to economic opportunity, great experiences and personal empowerment for millions of people around the world. http://www.transunion.com/business
| Contact | Dave Blumberg TransUnion |
| david.blumberg@transunion.com | |
| Telephone | 312-972-6646 |
FAQ
What was the percentage increase in auto insurance shopping in Q1 2024?
Which regions saw significant auto insurance shopping activity in Q1 2024?
What factors influenced the increase in auto insurance shopping?
How did property insurance shopping perform in Q1 2024?
What is the expected trend for mortgage rates in 2024 according to the report?
How might a decrease in mortgage rates affect property insurance shopping?
What percentage of consumers plan to purchase or lease a vehicle in the next 12 months?
What demographic groups are most active in insurance shopping according to the report?
