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The Insurance Purchase Decision - US - June 2019

Covered in this report

This report covers consumer attitudes toward purchasing life, health, auto, property, homeowners, and renters insurance.

What you need to know

Insurance is often a product bought out of necessity, not want. As such, the consumer relationship with their insurer is not as personal as in other industries, like healthcare. To find new customers, insurers must proactively reach out to consumers before they reach a life-changing event, or before their renewal date comes up.

"Insurance premiums continue to rise, and with consumers’ apathetic attitude toward the industry as a whole, they are mainly hanging on due to the necessity of having a policy. Agents are still considered valuable partners in purchasing across most lines of insurance. As premiums continue to increase and consumers potentially bristle at the thought of having to pay more, insurance companies need to embrace the evolving culture of transparency that younger generations are bringing on."
- Jennifer White Boehm, Associate Director - Financial Services & Automotive

This report looks at the following areas:

  • Make time for short-cuts
  • Combine the human and the digital
  • Use data to be proactive

What you get

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Table of contents

  1. Overview

    • What you need to know
      • Definition
      • Executive Summary

        • Overview
          • Key themes
            • Make time for short-cuts
              • Combine the human and the digital
                • Use data to be proactive
                  • What it means
                  • The Market – What You Need to Know

                    • More than half of consumers have employer-provided insurance
                      • Total US premiums increase nearly a trillion dollars in a decade
                      • Overview: US Insurance Market

                        • Total US premiums increase nearly a trillion dollars in a decade
                          • Figure 1: Total US premiums, all insurance types, 2007-17
                        • UnitedHealth Group is largest insurer in US for direct premiums
                          • Figure 2: Five largest US insurance groups, by direct premiums written, 2017
                        • Total premiums by line of business keep going up
                          • Health insurance premiums
                            • Figure 3: Total US premiums and deposits written for health insurance*, 2007-17
                          • Life insurance premiums
                            • Figure 4: Total US premiums written for life insurance*, 2009-17
                          • Auto premiums
                            • Figure 5: Total US premiums written for auto insurance, 2009-17
                          • Home insurance premiums
                            • Figure 6: Total US premiums written for homeowners insurance, 2009-17
                        • Market Factors

                          • Unemployment continues downward
                            • Figure 7: Unemployment, January 2014-April 2019
                          • America is aging
                            • Figure 8: Population by age, 2014-24
                        • Insurance Ownership

                          • Majority of consumers have at least one type of insurance
                            • Figure 9: Current insurance ownership, April 2019
                          • More than half of consumers have employer-provided insurance
                            • Figure 10: Employer-provided versus independently purchased insurance ownership, April 2019
                          • Auto remains most popular P&C insurance policy
                            • Figure 11: Property and casualty insurance types, April 2019
                        • Key Players across Insurance – What You Need to Know

                          • Non-insurance brands take a step into the insurance market
                            • Established insurers up technology investments
                              • Use of mobile tools low despite tech advances
                              • What’s Happening?

                                • Travelers and Amazon offer smart home kits for increased home insurance discounts
                                  • Figure 12: Travelers “Smart Home Insurance Solution” direct mail, December 2018
                                • Non-insurance brands take a step into the insurance market
                                  • Credit Karma releases auto insurance comparison tool
                                    • Tesla looks to lower costs by encouraging autopilot
                                    • What’s Struggling?

                                      • Health insurance: uninsured population grew from 2017 to 2018
                                        • Study shows those with private health insurance are charged more
                                          • Use of mobile tools low despite tech advances
                                            • Figure 13: Usage of mobile insurance tools, April 2019
                                          • GEICO promotes its mobile app as account management hub
                                            • Figure 14: GEICO mobile app email correspondence, February 2018
                                        • What’s Next?

                                          • Established insurers up their technology investments
                                            • Figure 15: Established insurers introducing tech-driven spinoff companies, April 2019
                                          • Halos Insurance looks to be first “loss preventive” insurance
                                            • Figure 16: Allstate commercial, “Don’t Tell Your Mother,” April 2019
                                          • Amazon’s entrance into insurance
                                            • State Farm tests blockchain insurance platform
                                            • The Consumer – What You Need to Know

                                              • Consumers are still using agents to buy their insurance
                                                • Quote retrieval presents opportunity for competitive comparison
                                                  • Reputation, customer service hold the attention of half of consumers
                                                    • Customer-agent relationship considered a benefit
                                                    • Purchase Channel

                                                      • Health insurance remains a top employer benefit
                                                        • Figure 17: Purchase channels – Health insurance, April 2019
                                                      • Life insurance comes from an employer or an agent
                                                        • Figure 18: Purchase channels – Life insurance, April 2019
                                                      • Auto insurance most likely purchased via phone or in person
                                                        • Figure 19: Purchase channels – Auto insurance, April 2019
                                                      • Homeowners and renters insurance purchased through agents
                                                        • Figure 20: Purchase channels – Homeowners or renters insurance, April 2019
                                                    • Purchase Behaviors

                                                      • Purchasing life insurance
                                                        • Consumers look to agents when buying life insurance, but may simply rely on employer
                                                          • Figure 21: Purchase behaviors – Life insurance, April 2019
                                                        • Millennials doing the most active research as they journey through life stages
                                                          • Figure 22: Purchase behaviors – Life insurance, by generation, April 2019
                                                        • Purchasing auto insurance
                                                          • Quote retrieval presents opportunity for competitive comparison
                                                            • Figure 23: Purchase behaviors – Auto insurance, April 2019
                                                          • Younger consumers more likely to go online, older are looking for personal touch
                                                            • Figure 24: Purchase behaviors – Auto insurance, by age, April 2019
                                                          • Purchasing homeowners or renters insurance
                                                            • Agents are a key step for consumers looking for homeowners or renters insurance
                                                              • Figure 25: Purchase behaviors – Homeowners or renters insurance, April 2019
                                                            • Urban consumers lean more heavily on online channels, while rural prefer agents
                                                              • Figure 26: Purchase behaviors – Homeowners or renters insurance, by geography, April 2019
                                                          • Factors in Choosing Policy or Provider

                                                            • Premiums continue to dominate insurance purchase decision
                                                              • Figure 27: Factors in choosing provider – Policy specifics, April 2019
                                                            • Reputation, customer service hold the attention of half of consumers
                                                              • Figure 28: Factors in choosing provider – Reputation and customer service, by age, April 2019
                                                            • Younger consumers, especially women, are looking to friends and family
                                                              • Figure 29: Factors in choosing provider – Word of mouth, by age and gender, April 2019
                                                              • Figure 30: Ally commercial, “Two-Star Dentist,” February 2019
                                                            • Gen Z, Millennials continue to push digitization of insurance
                                                              • Figure 31: Factors in choosing provider – Digital tools, by generation, April 2019
                                                          • Attitudes toward Insurance and Providers

                                                            • 1 in 5 don’t consider switching to be too difficult
                                                              • Figure 32: Attitudes toward bundling and switching, April 2019
                                                            • 25-54s are looking for one main insurance company
                                                              • Figure 33: Attitudes toward housing all insurance policies at one company, by age, April 2019
                                                            • Customer-agent relationship considered a benefit
                                                              • Figure 34: Relationships with agents, April 2019
                                                            • Consumers appreciate insurance company history
                                                              • Figure 35: Attitudes toward insurance companies, by generation, April 2019
                                                            • Most prefer to auto-renew, but more than half would still look for competitive pricing
                                                              • Figure 36: Automatic renewal versus quote comparisons, April 2019
                                                          • Appendix – Data Sources and Abbreviations

                                                            • Data sources
                                                              • Consumer survey data
                                                                • Direct marketing creative
                                                                  • Abbreviations and terms

                                                                  The Insurance Purchase Decision - US - June 2019

                                                                  £3,435.47 (Excl.Tax)