2019 U.S. Insurance Shopping Study: Summary and Reactions

insuranceJ.D.Power recently came out with the 2019 U.S. Insurance Shopping Study, where they outlined the consumer insurance shopping trends of 2019.  In it, they describe that with just 2-3% of new customers entering the personal lines auto insurance market each year, insurers have only one option when it comes to growing their business: taking market share from competitors.

According to the reportsuccess in driving new customer acquisition comes down to having a strong brand and meeting customer expectations of convenience and competitive price—for which direct and independent agents are best positioned. Meanwhile, insurers who are largely reliant on exclusive agents for new business growth are facing headwinds.

“We’re entering a new era of consumerism in the auto insurance marketplace, in which customers are in the driver’s seat when it comes to the shopping and servicing of their policies,” said Tom Super, Vice President of Insurance Intelligence at J.D. Power. “That trend is having a profound effect on the relationship between insurers and customers. A more empowered customer increases the importance of factors such as choice, personalization and maintaining a strong reputation to win and keep their business. That puts significant pressure on insurers to get their customer models just right with the proper mix of self-service tools, strong brand awareness and an engaged distribution network.”

With these recent findings, I wanted to share some tips and takeaways for agents looking to increase their share of the pie:

  • Shopping and switching rates put strain on loyalty 

While very few new customers have entered the auto insurance marketplace this year, the number of existing customers shopping for new policies has increased while the rate of switching among insurance shoppers has also increased during the past year. These two factors have driven down overall insurance customer retention meaning that now is the time to engage with your clients.

Building a strong client relationship builds on brand loyalty.  If there isn't the emotional connection to a product or service, it's very likely you'll have a high turn-over in the 21st century.

  • Price and financial outlook related to shopping behavior

Price is the leading factor that triggers a customer to shop, with 64% of insurance shoppers citing price as their primary reason to look for new insurance and competitive pricing (33%) is the most influential driver of the decision to close with a brand. When customer satisfaction with price is lower, shopping rates are higher the following year. Conversely, when satisfaction with price is higher, shopping rates are lower the following year. 

In a consumer driven market, you want to make sure that your team is putting a priority on value.  A great example I like to use are companies that outright tell their customer that they might not be the cheapest, but they'll take the extra step in sharing their competitors prices AND proceed to list the value they offer for the price.  I don't know about you, but many of the people I know would happily pay a little bit more if the perceived value is better.

  • Direct and independent agent models resonate with customers

The direct and independent agent channels continue to show increasingly higher levels of customer satisfaction, while the exclusive agent channel is falling behind. In the shopping process, top-performing insurers are operating as customer-facing brands.

For instance, insurers that achieve the highest consideration and quote rates among profiled insurers also achieve strong unaided awareness and are perceived as having likeable advertising, competitive pricing and being innovative.  For the captive agent, this means that the emphasis you put on your client relationships and relationship building will give you the leg up.  These agents are using advanced marketing techniques, including inbound services like ours, to drive new business and get the relationship building happening immediately on every call.

  • Unaided brand awareness critical for attracting insurance shoppers

Insurance shoppers obtain an average of three to four quotes when shopping, making it critical for insurers to be top-of-mind to make it into the consideration set. Brands recalled on an unaided basis are twice as likely to be considered and quoted than brands that are only recognized on an aided basis.

This is important for agents and producers who expect to one call close.  Without making an impression, and a proper follow-up process, you're doomed to fail.  Agents and producers alike need to be engaging, welcoming, and persistent.

  • High-value customers become next frontier

High-value shoppers, a segment of the marketplace that represents preferred risk profiles, better credit scores, fewer traffic violations and more insurance products, account for 22% of all insurance shoppers identified in the study. This is an crucial statistic to be aware of because currently, very few insurers are gaining more high-value customers than they are losing, underscoring the importance of attracting and retaining this lucrative subset of the market. 

Additionally, this means that at some point there will be a reckoning among top insurers as the majority of the marketplace does not classify into this preferred subset.  While there is no immediate fix for this, agencies that can capitalize on the other 78% of the marketplace are poised to get a leg up against their competition.


While all trends seem to be pointing to a tighter competitive marketplace, it's important for agents and brokers to know of the tide, what's to come, and how to make these trends work in their favor.  As always, we'll continue to bring you ideas and topics to help fuel your growth.

Got any feedback?  We want to hear from you!  Tell us what's working and not working in your office!

*Source information provided by: https://www.jdpower.com/business/press-releases/2019-us-insurance-shopping-study


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