In a world the place insurance coverage premiums are rising, shoppers are taking management of their choices like by no means earlier than. Whether or not it’s searching for a greater deal or switching suppliers to flee hovering renewal prices, the insurance coverage panorama is altering quickly. New information from Shopper Intelligence’s Insurance coverage Behaviour Tracker (IBT) reveals that 2024 is the yr of the savvy shopper. With sharp will increase in premiums, significantly for long-standing policyholders, and youthful prospects rethinking their method to comparability web sites, insurers are going through a essential second. Will they adapt to the shifting dynamics, or danger dropping prospects to extra aggressive affords?
Within the motor insurance coverage market, there was a notable 7% enhance in respondents seeing greater premiums at renewal in comparison with this time final yr. The over 50s are main the change in procuring round, whereas 18-24 yr olds have seen a slight drop of their procuring charges, regardless of going through a number of the largest premium will increase. These youthful drivers, when confronted with a worth hike, typically expertise steeper will increase than their older counterparts.
After we have a look at house insurance coverage, procuring peaked within the second half of 2023 (H2 23) when the biggest variety of prospects reported greater premiums. Whereas the market stabilised barely within the first half of 2024 (H1 24), many shoppers with 1-2 years of tenure proceed to see worth will increase at renewal. Like in motor insurance coverage, older policyholders usually tend to store round, with a 6% enhance in over 50s procuring in comparison with the earlier yr.
Premium will increase as the important thing driver
It comes as no shock that worth is the dominant issue driving each procuring and switching behaviour. In motor insurance coverage, our information reveals a 5% enhance between H1 23 and H1 24 in prospects switching to seek out the most affordable model out there. This pattern is especially apparent for these going through renewal will increase of £21 to £30, a notable set off level for switching.
Equally, in house insurance coverage, extra shoppers are saying they shopped round due to worth will increase in comparison with final yr. Nevertheless, not all shoppers are actively procuring; some are sticking with their suppliers as a result of they’re unable to discover a cheaper various. This highlights a rising complexity in switching behaviour, as price-sensitive shoppers weigh their choices in a unstable pricing surroundings.
The affect of worth comparability web sites
One of the vital attention-grabbing insights from our IBT information is the function of PCWs within the procuring journey. Whereas PCWs stay an important instrument for a lot of shoppers, youthful drivers particularly are much less doubtless to make use of them. In truth, one in 4 drivers aged 18-24 didn’t use a PCW on account of being unaware of their existence, a stunning statistic that means insurers might have to rethink how they interact this demographic. Contrastingly, older shoppers are extra doubtless to make use of PCWs to match quotes. Almost one-in-five folks stated they used a unique methodology of buy to the way in which they obtained their quote, with younger folks extra doubtless to do that than older prospects.
Trying forward
As we transfer by way of the rest of 2024, insurers might want to keep on high of those evolving procuring and switching patterns. The rise in price-driven switching and the differing behaviours throughout age teams highlights the significance of tailor-made methods. For insurers, the problem can be balancing aggressive pricing with buyer retention, significantly in segments the place worth sensitivity is excessive.
Insights that may allow you keep forward…
Unlock priceless insights into shopper behaviours and market traits with our Insurance coverage Behaviour Tracker. Perceive key decision-making components at renewal, observe model efficiency, and make data-driven enterprise plans.
