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PROPERTY AND CASUALTY INSURANCE-US-MARCH 2018

Published By :

Mintel

Published Date : Mar 2018

Category :

Insurance

No. of Pages : N/A

The insurance industry is competitive, as most people make their insurance choices based on price. Although the industry is flush with technological innovation, consumer loyalty is yet to be significantly impacted by these developments. Because it is easier to attract new, young customers than it is to get older ones to switch, insurers should focus not just on price but also on technological solutions that allow consumers to interact with insurers in the way they want and to get the type of insurance they need. This Report covers some of the challenges involved in attracting these new customers and discusses some of the innovations that are changing the way the industry works.

Table of Contents

OVERVIEW
What you need to know
Definition
EXECUTIVE SUMMARY
The issues
Property and casualty insurance is a saturated market
Figure 1: Insurance ownership, by generation, December 2017
Men and Millennial consumers are most likely to switch P&C insurers
Figure 2: P&C switching behaviors, by gender and generation, December 2017
Figure 3: Auto switching behavior, by generation, December 2017
The opportunities
Consumers are receptive to mobile solutions and new technologies
Figure 4: P&C behaviors, mobile phone/app use, by generation, December 2017
Figure 5: P&C behaviors, by race/ethnicity, December 2017
Most renters do not have renters insurance
Figure 6: Insurance ownership, by housing situation, December 2017
Usage-based policies are gaining in popularity
Figure 7: P&C preferences, by generation, December 2017
Consumers are receptive to insurance inclusion in property prices
Figure 8: P&C behaviors, interest, by generation and parental status, December 2017
What it means
THE MARKET – WHAT YOU NEED TO KNOW
Net income in P&C industry dropped 30% in first nine months of 2017
Premiums continue to climb
2017 car sales fall for first time since 2009
State Farm remains the largest P&C insurer
Average homeowners and auto expenditure rising, renters flat
MARKET SIZE
Industry financials
Figure 9: P&C insurance industry income analysis ($ billions), 2012-16
P&C industry net income dropped 30% in first nine months of 2017
Figure 10: P&C insurance industry income analysis ($ billions), 2016-17
Premiums continue to climb
Figure 11: Net premiums written, 2006-16
Largest P&C insurers
Figure 12: Top 10 writers of property and casualty insurance, by direct premiums written, 2016
Largest P&C direct mailers
Figure 13: Top 10 property and casualty insurers, by direct mail offers sent, 2016
MARKET BREAKDOWN
Auto
Figure 14: Average auto insurance expenditure and change from prior year, 2006-15
Figure 15: Top 10 writers of private passenger auto insurance, by direct premiums written, 2016
Figure 16: Incurred losses for auto insurance*($000), 2011-16
Homeowners and renters
Figure 17: Average premiums for homeowners and renters insurance, US, 2006-15
Figure 18: Top 10 writers of homeowners insurance, by direct premiums written, 2016
MARKET FACTORS
Rates of driving and crashing are both on the rise
Figure 19: Traffic volume trends, vehicle-distance traveled, 1993-2017
Figure 20: Total police-reported motor vehicle crashes, 1989-2015
Vehicle sales dip, rebound through 2017
Figure 21: Light weight vehicle sales: autos and light trucks, 2008-18
KEY PLAYERS – WHAT YOU NEED TO KNOW
Insurtech poised to disrupt P&C industry
Telematics drive auto policy efficiency forward
Drones: both tool and liability
Artificial intelligence on the horizon
WHAT’S WORKING?
Insurtech
Metromile: a case study in Insurtech innovation
Figure 22: Metromile, direct mail campaign, February 2018
Telematics
Figure 23: Nationwide, email campaign, December 2016
Allstate: Drivewise & Allstate Rewards
Figure 24: Allstate, email campaign, June 2017
WHAT’S STRUGGLING?
Utilizing big data presents numerous hurdles
Distracted driving poses a serious risk
The sharing economy poses challenges and opportunities
Figure 25: Uber and State Farm, email campaign, January 2018
Figure 26: Plymouth Rock, email campaign, November 2017
WHAT’S NEXT?
Big data will continue to shape the evolution of the industry
Technology companies will throw their hats in the insurance ring
Artificial intelligence
Slice provides on-demand homeshare insurance
Drones: the insurer and the insured
THE CONSUMER – WHAT YOU NEED TO KNOW
Most consumers have at least one property and casualty policy
Many renters do not own renters insurance
Consumers warming to role of mobile in P&C
Satisfaction, trust, and price drive P&C loyalty
Usage-based policies enjoy wide generational popularity
INSURANCE OWNERSHIP
Property and casualty insurance is widely held
Figure 27: Insurance ownership, by generation, December 2017
Home-owning consumers are much more likely to have auto insurance
Figure 28: Insurance ownership, by housing situation, December 2017
Figure 29: State Farm, direct mail campaign, January 2017
Most renters do not own renters insurance
Multiple P&C policies with one insurer is the norm
Male and Hispanic consumers use multiple insurers
Figure 30: Insurance ownership, multiple policies per company, by area, December 2017
Figure 31: Insurance ownership, multiple policies per company, by gender and Hispanic origin, December 2017
Consumers cite price and efficiency in bundling decision
SWITCHING BEHAVIORS
Auto insurance
Men are more likely to plan to switch auto insurers
Figure 32: Auto switching behavior, by gender, December 2017
Millennials and iGen consumers switch more, and plan to continue doing so
Figure 33: Auto switching behavior, by generation, December 2017
Home insurance
Figure 34: Homeowners switching behaviors, by gender and area, December 2017
Renters insurance
Figure 35: Renters switching behaviors, by generation, December 2017
Impact of price on switching
Figure 36: Progressive, direct mail campaign, January 2018
Figure 37: Farmers Insurance, direct mail campaign, January 2018
Figure 38: GEICO, direct mail campaign, September 2017
FACTORS THAT INFLUENCE P&C LOYALTY
Satisfaction and trust top the list
Figure 39: P&C loyalty, influencing factors, by generation, December 2017
Lower prices and bundling are compelling reasons to stay
Figure 40: P&C loyalty, influencing factors, December 2017
Mobile and online capabilities are important to younger generations
Figure 41: P&C loyalty, influencing factors, by generation, December 2017
Qualitative survey responses echo importance of cost factor
ATTITUDES TOWARD INSURANCE
Many consumers believe “insurance companies are all the same”
Figure 42: Attitudes toward insurance and insurance companies, by demographics, May 2017
Figure 43: Progressive email campaigns, February-July 2017
Consumers have high demands, but little praise
Figure 44: Attitudes toward insurance and insurance companies, by generation, December 2017
TECHNOLOGY AND THE FUTURE OF P&C
Mobile is becoming a prominent P&C interface...
Figure 45: P&C behaviors, mobile phone/app use, by generation, December 2017
Figure 46: P&C behaviors, purchasing a policy via mobile app, by generation, December 2017
Technological innovations are not yet a reason to switch
Consumer sentiment varies widely regarding role of mobile
Consumers are interested in tech and startup solutions...
Figure 47: P&C behaviors, by race/ethnicity, December 2017
...although significant skepticism remains
Consumers want usage-based policies
Figure 48: P&C preferences, by generation, December 2017
Consumers are receptive to insurance inclusion in property prices
Figure 49: P&C behaviors, interest, by generation and parental status, December 2017
APPENDIX – DATA SOURCES AND ABBREVIATIONS
Consumer survey data
Consumer qualitative research
Direct marketing creative
Abbreviations and terms
Abbreviations
APPENDIX – THE MARKET
Identity theft protection
Figure 50: Identity theft and fraud complaints, 2013-16

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