Auto insurance comparison habits ignored brands during pandemic: study

Auto insurance comparison - Money - Car

A J.D. Power study showed that consumers weren’t interested in specific brands.

Though auto insurance comparison shopping was a common activity during the COVID-19 pandemic, consumers were typically uninterested in specific brands, said the results of the J.D. Power 2021 U.S. Insurance Shopping Study.

Over half of consumers didn’t do any price comparing at all throughout the majority of the pandemic.

The survey revealed that 54 percent of consumers didn’t try auto insurance comparison shopping for the purpose of improving their premiums during the pandemic. Of the 46 percent who did shop around, 17 percent cut down on their coverage and another 15 percent looked for a new carrier. About 12 percent switched to a new carrier or chose a policy that came with a higher deductible.

There was a 6 percent increase in insurance shopping habits among policyholders whose financial circumstances were changed as a result of the pandemic, showed the study results. Throughout the pandemic, there was an overall 55 percent drop in the average number of miles driven in the United States. Moreover, the start of the COVID-19 pandemic in early 2020 brought on a record-breaking unemployment rate of 15 percent.

The circumstances of the pandemic revealed a great deal about auto insurance comparison habits.

“The pandemic has revealed a lot about insurance shopping behaviors in 2020, as there was a significant surge in shopping activity among customers who were financially affected and many gravitated to big, well-known brands and offers for lower rates,” said J.D. Power head of property & casualty insurance, Tom Super, in a prepared statement.

The results, said Super, place the spotlight on the importance for insurers to implement a more sophisticated acquisition and retention strategy in order to help them to stand out from among rivals.

“Ironically, while the industry’s estimated annual ad spend now nears $10 billion, consumers say they see less differentiation among the top brands,” added Super while discussing the pandemic auto insurance comparison shopping trend. “Following a period of massive disruption and a prolonged, uneven recovery, auto insurance Auto insurance comparison - Money - Carcustomers have a heightened expectation about factors such as price, flexibility and coverages. Insurers need to get more creative around customer service and delivery because the current incremental changes are missing the mark.”

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