Read more: Auto insurance shopping rate drops in Q3 – LexisNexis
Meanwhile, new policy growth was -6.9% for the quarter compared to Q4 2020 – only a slight improvement from the two-year low of -7.3% in Q3 2021. The industry responded to this by scaling back its marketing activities, focusing instead on rate increases and restoring profitability.
“Over the past two years, the automotive and auto insurance industries have been marked by shopping ebbs and flows that have, at times, been a complete departure from what we’re accustomed to seeing – particularly the unusual trends we saw in 2020,” commented LexisNexis Risk Solutions vice president and general manager of auto insurance Adam Pichon.
“While early 2021 again showed surprising upticks in shopping behavior influenced by macroeconomic conditions, we’re seeing things begin to trend back to the norm over the last two quarters,” Pichon continued. “As a result, consumers across the country have seen their insurance rates rise steadily in recent months as insurers have been on their toes evaluating profitability as more drivers are getting back on the road.”
LexisNexis did suggest in its report that 2022 could be another year of auto and insurance shopping volatility in year-over-year growth rates. The report has pointed to two things – how the market reacts to ongoing automobile chip shortages and consumers’ responses to the lack of stimulus checks and annual child tax credits – as key trends for the industry to keep an eye on.
Although insurance shopping growth continues to take a hit, Pichon suggested that “shopping activity increases this year could be on the horizon” as the carrier rate increases take effect in the months to come.
“Historically, significant rate disruption has been a catalyst for high shopping volumes in the market,” the vice president said.