For the second consecutive quarter, the LexisNexis US Insurance Demand Meter has reported "nuclear" levels of auto insurance shopping and new policy growth, with Q3 2024 setting a record since the tracking of US insurance consumer shopping behavior began over a decade ago.
Insurer-led marketing initiatives and industry rate increases spurred significant activity among price-sensitive consumers, driving nearly half (45%) of all US policies in force to be shopped within the past 12 months.
According to LexisNexis Risk Solutions, US consumer auto insurance shopping grew 31.2% year-over-year in Q3 2024, up from 16.1% growth in Q2. New auto policy volumes increased by 25.9% year-over-year, compared to 19.5% growth recorded in Q2.
The data highlighted increased activity among traditionally less active consumer segments, including the 66+ age demographic and preferred, long-tenured customers. Rate increases appeared to drive this shift.
Direct-to-consumer shopping channels saw the largest gains, with shopping rates increasing 67% and new policies growing 54%. Independent agent carriers also experienced growth, posting a 26% increase in shopping rates.
Certain states showed significant growth in both shopping and new policy activations. Florida, Texas, and Michigan led by volume with respective increases of 38%, 33%, and 19%.
Wyoming, Louisiana, and Montana topped percentage growth with increases of 80%, 54%, and 47%, respectively. New York and California ranked in the top five in both volume and percentage growth categories.
Hurricane Helene, which made landfall late in Q3, temporarily disrupted shopping activity in several states. Florida and Georgia experienced initial declines of 17% and 16%, respectively, but rebounded faster than North and South Carolina, where the storm’s lingering effects continued to impact shopping trends through the end of the quarter.
"Throughout Q3, the momentum in policy shopping and new policy volumes reached unprecedented levels as US insurers worked to balance profitability with market demands," said Jeff Batiste (pictured above), senior vice president and general manager of US auto insurance at LexisNexis Risk Solutions.
He noted that strategic marketing reactivation efforts enabled insurers to attract cost-conscious consumers in a market characterized by rising auto and home policy costs.
Chris Rice, vice president of strategic business intelligence at LexisNexis Risk Solutions, highlighted the effects of stabilizing claim severities, increased weather-related events, and rate adjustments as critical factors to monitor moving forward.
"Typically, soft markets spur aggressive marketing and targeted US rate adjustments to enhance segmentation," Rice said. "Following an especially challenging four years, US insurers must closely track these industry trends, particularly the behavior of long-tenured customers who may be more inclined to shop in the future."
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