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US Property and Casualty Insurance market report

Everything you need to make the right decisions

Providing the most comprehensive and up-to-date information and analysis of the Property and Casualty Insurance market, and the behaviours, preferences and habits of the consumer.

Mintel has the answers you’re looking for

What are the key challenges facing the industry and how fast are its rates of growth? Who is the consumer and what do they want? Where are the opportunities, where are the risks and what lies ahead?

Definition

This Report only covers P&C (property and casualty) insurance – auto, homeowner/condo, and renters insurance. It does not include any information about health or life insurance. This Report builds on the analysis presented in Mintel’s Property and Casualty Insurance – US, January 2017.

Expert analysis from a specialist in the field

Written by Chris Shadle, a leading analyst in the Financial Services sector, his extensive knowledge delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

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. Chris Shadle
Financial Services Analyst

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Table of contents

  1. 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