ATLANTA, Nov. 17, 2020 /PRNewswire/ -- To help
carriers understand the ever-changing market and offer them
benchmark insights, LexisNexis® Risk Solutions released its latest
Insurance Demand Meter, reporting on Q3 U.S. auto insurance
shopping activity. The Meter shows that both shopping and new
business policy volumes increased overall in the third
quarter, but slowed in August, likely impacted by the end of the
Coronavirus Aid, Relief and Economic Security (CARES) Act
benefits, significant hurricane activity, and the wildfires in
the West.
Extreme weather events
Destructive hurricanes in the
Gulf, including hurricanes Laura and Marco, which both made
landfall in Louisiana less than a
week apart, and an unusually large number of wildfires across the
West seemingly significantly impacted auto insurance shopping on a
regional level.
- Comparing shopping volumes against those days in 2019, shopping
volumes fell 18% from last year's volumes after Hurricane Marco
hit; then volumes fell off 36% after Hurricane Laura's impact a few
days later.
- California fires appear to
have caused a reduction in shopping volumes for two consecutive
weeks in mid-August (-9.2%, -8.0%, respectively) and Washington saw a drop in growth by -8.2% in
late-August, correlating with the peak of fire activity within
those states.
Uninsured and Insured Shopping
Insured shopping
volumes saw a positive growth of nearly 10% in Q3. Conversely,
uninsured shopping started falling in August, holding a steady -10%
growth rate from mid-August through September, likely a result of a
combination of unemployment benefits expiring at the end of July
and insurance carrier cancellation moratoria that resulted in fewer
insureds leaving the market.
"Despite a challenging Q3 for many consumers, as the economy
continues to improve and unemployment levels normalize, we expect
consumers to return to the auto insurance market, which will
accelerate new policy growth and ultimately help to decrease
uninsured motorist claim frequency," said Tanner Sheehan, associate vice president of auto
insurance at LexisNexis Risk Solutions. "Extreme weather events
also proved to disrupt the auto insurance market this quarter and
if no improvement is shown, we could see continued negative
implications for insurance carriers down the line."
Additional key insights from Q3 include:
- New policyholders, new revenue opportunities: The auto
insurance shopping quarterly growth rate averaged 6.1 % in Q3,
ending the quarter at 7.6%. New business growth also increased to
5.7% during the quarter, which was nearly twice the growth rate of
both the previous year and the 5-year quarterly average.
- Trends by shopping channels: The reduction in shopping
among the uninsured impacted each of the distribution channels
differently. For example, direct channel volumes remained flat to
negative, which tends to be most preferred by shoppers without
insurance.
"Given the unprecedented impact we've seen thus far, the
COVID-19 pandemic will likely continue to influence the auto
insurance shopping market throughout 2020 and continue to affect
market dynamics into 2021. As of now, potential stimulus and
Americans eventually returning to work in-person will be the
biggest drivers of results in the insurance market in the near
term," Sheehan continued.
About the LexisNexis Insurance Demand Meter
The
LexisNexis Insurance Demand Meter is a quarterly analysis of
shopping volume and frequency, new business volume and related data
points. LexisNexis Risk Solutions offers this unique market-wide
perspective of consumer shopping and switching behavior based on
its analysis of billions of consumer shopping transactions since
2009, representing nearly 90% of the universe of shopping
activity.
To download the latest Insurance Demand Meter, click here.
About LexisNexis Risk Solutions
LexisNexis® Risk Solutions harnesses the power of data and advanced
analytics to provide insights that help businesses and governmental
entities reduce risk and improve decisions to benefit people around
the globe. We provide data and technology solutions for a wide
range of industries including insurance, financial services,
healthcare and government. Headquartered in metro Atlanta,
Georgia, we have offices
throughout the world and are part of RELX (LSE:
REL/NYSE: RELX), a global provider of information and
analytics for professional and business customers across
industries. For more information, please
visit www.risk.lexisnexis.com, and www.relx.com.
Media Contacts:
Rocio
Rivera
LexisNexis Risk Solutions
Phone: +1.678.694.2338
rocio.rivera@lexisnexisrisk.com
Mollie Holman
Brodeur Partners for LexisNexis Risk Solutions
Phone: +1.646.746.5611
mholman@brodeur.com
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SOURCE LexisNexis Risk Solutions