Report shows that more consumers favor switching carriers over purchasing new policies
J.D. Power and Associates, a global marketing information service, has released a new report that shows a sharp decline in the number of people purchasing auto insurance in the U.S. The report shows that the number of car owners that are purchasing new insurance policies is diminishing. These drivers are, however, switching insurance carriers at a higher rate. The report draws upon data collected by J.D. Power through a recent survey of U.S. auto insurance consumers.
Many drivers seek out insurance coverage online
According to the report, a large portion of consumers have stopped shopping around for auto insurance coverage. Of these, 43% claim to have switched carriers last year, up from the 40% seen in 2010. Nearly one in three of consumers who shopped around for insurance did so online. Approximately 40% of these people noted that they were more likely to purchase auto insurance coverage online rather than through other means. The report does not reference the reasons behind the trend.
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Report highlights spending and customer satisfaction
The trend seems to defy efforts from major auto insurance companies, who have launched aggressive and costly marketing campaigns in an attempt to attract new business. The J.D. Power report suggests that the overall spending on advertising from the country’s largest auto insurance companies jumped by 12% in 2011. Many consumers have responded well to the marketing efforts from these companies, but many more have remained unaffected. Satisfaction may be a factor, according to the report.
Allstate and Progressive suffer in terms of customer satisfaction
The report notes that Allstate and Progressive both ranked near the bottom five out of 24 insurance companies that were surveyed regarding customer satisfaction. J.D. Power notes that increased marketing may not be enough to win over consumers that have been spurned in the past due to lapses in customer service. The report suggests that consumers are more likely to continue looking for auto insurance coverage online, though it did not indicate how many of these consumers actually purchased coverage online.