Consumers Shopping For Insurance In The Midst Of The Pandemic

The COVID-19 pandemic forced advisors to find new ways of interacting with consumers, while consumers still value the personalized agent touch despite having more options to buy insurance than ever.

Those were among the takeaways from the most recent Acxiom Market Pulse Insurance Covid Study. The study results were analyzed during a webinar sponsored by the Society of Insurance Research on Thursday.

The researchers examined consumers’ attitudes toward insurance in the second quarter of 2020 and again in the third quarter of 2021. What the survey found was that the pandemic’s economic impact had an influence on consumers’ ownership of insurance products as well as their interest in buying.

Four key takeaways from the study were:

1. Consumers are shopping for insurance and looking for ways to save money on it. Agents and carriers must have a strategy to retain their current clients.
2. Online shopping for insurance is here to stay but many consumers still value working with an agent. Consumers value choice. They want the ability to engage online but still want the ability to connect with an agent. The industry must continue to build on the value agents bring to consumers.
3. There has never been a greater opportunity for insurers to get their value proposition in front of consumers. Saving and protection are on consumers’ minds.
4. Generations differ in their needs and in the way they want to buy. Insurers and agents must understand generational needs and differentiate to meet those needs.

Decrease In Auto And Homeowners Insurance Ownership

Over the past year, the survey showed significant decreases in ownership of auto and homeowners/renters insurance. Much of this is attributed to the economic impact of the pandemic. Many consumers changed driving habits in the pandemic and some households that owned multiple cars may have decided to get rid of at least one of them.

In addition, many young adults who were renting moved in with family members during the pandemic, eliminating their need for renters insurance. Many older consumers consolidated households with younger family members.

COVID-19 Changed Attitudes On Owning Life Insurance

The survey showed an increase in life insurance ownership among those ages 18-24. Before COVID-19, this age group traditionally saw themselves as invincible, the researchers said. But the pandemic may have changed the way they think about their mortality.

Online Buying Is Here To Stay

Although the majority of consumers report buying all types of insurance through an agent, 44% said they bought coverage online. Online remains the dominant purchasing channel for those ages 18-44 while in-person was the top way to buy insurance for those ages 45-74.

But looking at ways consumers say they would purchase coverage in the future, the survey showed a movement toward online buying. Four in 10 surveyed said they are likely to buy online in the future while only 31% said they prefer to buy through meeting personally with an agent. Carriers that don’t have an online buying experience will be left behind, researchers said.

Agents Are Still Important

The importance of interacting with an agent increased between Q2 2020 and Q3 2021, the survey showed. In Q2 2020, 41% of those surveyed said they believed it was “essential” or “very important” to interact with an agent, and that percentage increased to 49% in Q3 2021.

The researchers said that much of the increase is driven by consumers’ changing expectations of insurers and the need for agents to help consumers find ways to save money.

What Would Get You To Switch?

The survey showed a rise in the percentage of consumers who said they are likely to shop for auto, home or life insurance in the coming year. Carriers must have strategies to retain their current customers while finding ways to acquire business from competitors, the researchers said.

Most consumers are motivated by savings when it comes to switching carriers, the survey found. But how much savings would motivate them to switch? The survey found consumers would want to see savings of at least 20% on their auto insurance premiums before they would change carriers. When it comes to home insurance, 36% said they are satisfied with their current provider. But 22% said they would switch carriers if they could save 20% or more on premiums. On the life insurance side, 29% said they were happy with their current carrier but 22% would jump ship if they could find a provider that would save them 20% or more.

Susan Rupe is managing editor for InsuranceNewsNet. She formerly served as communications director for an insurance agents' association and was an award-winning newspaper reporter and editor. Contact her at [email protected]. Follow her on Twitter @INNsusan.

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Susan Rupe is editor in chief, magazine, for InsuranceNewsNet. She formerly served as communications director for an insurance agents' association and was an award-winning newspaper reporter and editor. Contact her at [email protected].