Insurers’ Efforts to Improve Profitability Drive Auto and Property Insurance Shopping
November 14 2023 - 7:00AM
Macroeconomic trends affecting insurance shopping in the first half
of 2023 continued throughout Q3. Auto and property insurance
shopping rates were flat compared to Q2 2023 but elevated 12% and
6%, respectively, compared to Q3 2022.
The findings are part of TransUnion’s (NYSE: TRU) latest
quarterly Insurance Personal Lines Trends and Perspectives Report,
which includes trends in the auto and property insurance markets,
as well as survey data about consumers’ behaviors and
attitudes.
The search for lower insurance premiums remains a primary driver
of auto insurance shopping. The Insurance Information Institute
forecasted auto insurance premium growth of 10.4% in 2023—double
the 5% premium growth from the previous year.
“In addition to raising rates, insurers are employing other
measures to improve their profitability, like suspending
distribution and toughening underwriting standards,” said Stothard
Deal, vice president of strategic planning for TransUnion’s
insurance business. “These efforts have likely motivated consumers
to expand their shopping activity with new insurers.”
New vehicle sales were also a contributing factor. A healthy
labor market and the increase in employers’ return to work policies
are likely motivating consumers to purchase new vehicles. According
to J.D. Power, the US new automobile market remains resilient, with
the outlook for sales in 2023 increasing to 7% over 2022.
How bundling can attract and retain
policyholdersConversely, home sales and refinancing—two
important triggers for property insurance shopping—remain
depressed. Homeowners locked into low interest rates are reluctant
to sell and purchase new properties at current rates.
However, property insurance shopping remains elevated over 2022.
One factor pushing this trend is the hunt for lower insurance
premiums. Another is the increased number of insurers requiring
bundling or multiline policies. As consumers shop for auto
insurance, they may be forced to consider switching their home
insurance as well, even if they are happy with their current
policy.
With pressure being placed on retaining policyholders,
opportunities exist for insurers to consider value-added services
outside of basic coverage options. For example, home insurance
policies have long included identity theft protection.
The report notes that cyber security threats are evolving and
insurers should broaden their offerings. Social engineering scams,
in which bad actors trick consumers into clicking a malicious link
or sharing personal information, are now one of the most prevalent
threats.
Many insurers are exploring ways to assist policyholders due to
different types of fraud and cyber risks, including social
engineering scams, ransomware attacks and cyberbullying events.
Going further, the report recommends adopting preventative
solutions that complement existing restorative measures.
One such solution is TransUnion’s TruEmpower™ Scam Blocker,
which helps protect individuals, families and small businesses from
harmful cyber incidents by blocking fraudulent websites, phishing
attempts, and other cyber threats on mobile devices and laptops.
Delivered through insurers, Scam Blocker adds value and can give
peace of mind to policyholders while assisting to reduce claims
costs to insurers.
“TransUnion research has found consumers look to their insurers
for guidance and protection in the aftermath of a cyber-attack,”
said Matt Cullina, head of TransUnion’s global cyber insurance
business. “Providing a robust, preventative measure can help
policyholders feel safer online and more secure in their coverage
policy.”
To read the complete Insurance Personal Lines Trends &
Perspectives Report, click here.
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 March 2022 to
September 2023. 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 12,000 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 BlumbergTransUnion |
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E-mail |
david.blumberg@transunion.com |
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Telephone |
312-972-6646 |
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