CivicScience has been steadily tracking changes on the insurance front, including the impact of rising home insurance and health insurance costs. Auto insurance is no exception – it’s estimated that the average cost of full auto insurance coverage in America rose more than $2,500 in 2024, which represents a 26% increase over last year. How are these skyrocketing rates impacting Americans?
One way consumers appear to be dealing with rising auto insurance rates is by shopping for new coverage. Quarterly averages show that 29% of U.S. adults intend to switch their car insurance company, which rests six points higher than Q1 2023.
Regionally, those in the U.S. South and West are the most likely to switch car insurance companies. But it’s policyholders in cities that stand out the most – 45% are likely to change insurance companies in the near future, nearly twice that of suburban residents.
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Which insurance companies are most at risk?
CivicScience tracking shows a wide range when it comes to how insurance companies are likely to be impacted by insurance switchers. State Farm and Progressive rank as the two most popular car insurers, and their current customers are among the least likely to switch auto insurance companies. On the other hand, more than half of Nationwide and customers and 45% of Liberty Mutual customers report they’re likely to change companies in the next 90 days.
Who’s most likely to switch?
Data indicate that people who primarily drive trucks are more likely to switch insurers in the next 90 days (34%) than sedan (30%) or SUV/crossover drivers (21%).
Additional data show that car insurance customers under age 35 are far more likely than older adults to switch insurance companies, making up 46% of those aged 25-34 and 47% of those aged 18-24. Many may be hunting for more cost-effective plans, which is understandable given that nearly 3-in-10 adults looking for new car insurance also have student loan debt. And a total of 69% cite either debt or managing daily living expenses as their main source of financial stress, compared to 57% of people not looking for new insurance.
That said, a leading reason to find new insurance may be the purchase of a new car. Two-thirds of drivers who want to switch car insurance say they are at least ‘somewhat’ likely to buy or lease a new car in the next 90 days.
Car buying naturally incentivizes shopping around for a new policy, but it’s also clear from the data that those looking to switch car insurance companies are financially motivated. And based on the findings, State Farm and Progressive have an edge over other big national companies in retaining their current customers, while Nationwide, USAA, and Liberty Mutual look to lose the most.
Editor’s note: This article was originally published February 21, 2024 and has been updated to reflect new data collected through March 15, 2024.
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