Despite a temporary downturn in the early weeks of the COVID-19 pandemic, personal auto insurance shopping rates actually rose in the first half of the year, according to TransUnion’s 2020 Insurance Shopping Annual Report.
For the first two months of 2020, personal auto insurance shopping trended higher year-over-year, driven by increased vehicle purchases, more convenient shopping options and record industry advertising spending, TransUnion noted. But the situation took a sharp turn beginning the week of March 22, when shopping rates dropped as much as 14 percent.
However, the study found that while shopping bottomed out in April, it began to rebound in May and continued its rise through June, actually exceeding the monthly shopping rate of the two prior years.
TransUnion conducted an online survey of more than 3,000 U.S. auto insurance policyholders, aged 18 years or older, during the week of July 27.
Among the study’s highlights:
- 30 percent of survey respondents said a major life event was a key force behind their decision to shop for auto insurance, followed by a need to reduce expenses due to COVID-19’s impact on household income (24 percent). TransUnion noted that while typical life events that drive auto insurance shopping (marriage, having a child, buying a new home) have been put on hold during the pandemic, these may be replaced by new economic worries (job loss, reduction in pay).
- The economic impact from the pandemic has hit younger generations a little harder, with a higher percentage of Gen Z (61 percent) and millennial consumers (60 percent) reporting their household income was negatively impacted by COVID-19 compared to older consumers (55 percent of Gen X and 44 percent of baby boomers).
- Premium rebates offered to policyholders to help offset the economic impact of COVID-19 have proven to be beneficial for both policyholders and carriers. For the policyholders who recall being contacted by a carrier about a premium relief or discount (45 percent), 61 percent said the gesture increased their loyalty to their auto insurer.