{"id":3119,"date":"2025-10-05T22:58:20","date_gmt":"2025-10-05T22:58:20","guid":{"rendered":"http:\/\/ft365.org\/index.php\/2025\/10\/05\/even-loyal-customers-are-shopping-for-new-insurance-bankrate\/"},"modified":"2025-10-05T22:58:20","modified_gmt":"2025-10-05T22:58:20","slug":"even-loyal-customers-are-shopping-for-new-insurance-bankrate","status":"publish","type":"post","link":"https:\/\/ft365.org\/index.php\/2025\/10\/05\/even-loyal-customers-are-shopping-for-new-insurance-bankrate\/","title":{"rendered":"Even Loyal Customers Are Shopping for New Insurance | Bankrate"},"content":{"rendered":"
\n

It\u2019s no secret that insurance companies are raising rates faster and higher than ever. But now, as 2025 rolls past its halfway mark, experts are noting a new trend from insurance customers: unprecedented rates of insurance shopping. In 2024, over half of the U.S. shopped for new car insurance, home insurance or both.<\/p>\n

But it\u2019s not just that more people are shopping for insurance \u2014 insurance experts are especially interested in who<\/i> is shopping. While it\u2019s common for younger policyholders, auto-only shoppers or lower-income households to shop frequently for better rates, 2024 saw record rates of shopping by high-value, traditionally loyal customers with bundled policies.<\/p>\n

Over half of U.S. insurance customers shopped for a new policy last year<\/h2>\n

According to J.D. Power\u2019s 2025 U.S. Insurance Shopping Study, a record 57 percent of U.S. insurance customers shopped for a new policy in 2024, up from just 49 percent the previous year. That\u2019s an all-time high since the study launched 19 years ago. This unprecedented shopping rate coincides with a steep increase in the overall cost of car insurance, with drivers paying an average of 12 percent more at the start of 2025 than they did in January 2024.<\/p>\n

More shoppers create stronger incentives for insurance companies to attract new customers \u2014 through refreshed ad campaigns, improved service and competitive rates.<\/p>\n

Bundlers are more likely to shop and switch companies<\/h2>\n

Out of the thousands of customers shopping for home and auto insurance, experts are particularly interested in one group of policyholders: those seeking bundles.<\/p>\n

\u201cBundling auto and home policies has traditionally provided benefits to both consumers and insurers,\u201d says Stephen Crewdson, managing director for Global Insurance Intelligence at J.D. Power. While customers benefit from bundling discounts, \u201cinsurers benefit from increased loyalty and retention from bundled customers, which means a longer relationship with the customer and hence, more revenue.\u201d<\/p>\n

But now, those loyal, valuable customers are shopping \u2014 and switching \u2014 at higher rates than in the past. J.D. Power\u2019s shopping study found that one-third of customers shopping in 2024 were seeking auto and home insurance bundles.<\/p>\n

Why are these historically loyal customers seeking greener pastures now? Crewdson says that it may be a delayed reaction to premium increases. While less affluent shoppers tended to respond more quickly to rate hikes by searching for price relief, many bundled customers seemed to have weathered rising rates for a year or two before deciding the discount or convenience was no longer worth the cost.<\/p>\n

\n

We sometimes use the metaphor here of the concept from physics of inertia. An object with more inertia takes more force to get it to move. But you can eventually get it to move, right? I think that\u2019s what\u2019s happening with the higher-value customers.<\/p>\n

\u2014 Stephen Crewdson<\/cite> Managing Director for Global Insurance Intelligence, J.D. Power<\/span> <\/p><\/blockquote>\n

Rising home insurance rates drive uptick in shopping<\/h3>\n

One force breaking through the bundled inertia is a spike in home insurance prices, including in states usually seen as \u201clow risk.\u201d With insurance companies struggling to absorb the high cost of losses in disaster-prone states like California and Florida, even homeowners in states without a significant history of natural disasters are seeing larger increases in their insurance premiums.<\/p>\n

For some homeowners, the rate increase may be as low as 5 or 10 percent. But others saw rate increases of 40 percent or higher in 2024 \u2014 more than enough to outweigh the discount that comes with a home and auto insurance bundle.<\/p>\n

Increasing nonrenewals and cancellations lead some customers to switch<\/h3>\n

For some customers, shopping isn\u2019t a reaction to rising rates \u2014 it\u2019s the only option following a policy nonrenewal or cancellation.<\/p>\n

Across certain regions, many homeowners have experienced a wave of nonrenewals as insurers pull out of local markets. Those affected might search for a new home insurance provider or switch both their home and auto policies to another carrier offering a bundled rate.<\/p>\n

Insurance companies spent nearly $8 billion last year chasing new business<\/h2>\n

While sticker shock and market volatility contributed to the recent surge in insurance shopping, it\u2019s also worth noting that U.S. insurers spent record amounts last year to acquire new customers. According to S&P Global, the total combined ad spend for the industry\u2019s \u201cBig Four\u201d insurers \u2014 State Farm, Progressive, Geico and Allstate, in order of market share \u2014 came in just shy of $8 billion in 2024, over double what the same companies spent the previous year.<\/p>\n

\n\n\n\n\n\n\n\n\n
Carrier<\/strong><\/th>\n2023 advertising budget (billions)<\/strong><\/th>\n2024 advertising budget (billions)<\/strong><\/th>\nGrowth in premiums written<\/strong><\/th>\n<\/tr>\n<\/thead>\n
Progressive<\/td>\n$1.22<\/td>\n$3.49<\/td>\n21%<\/td>\n<\/tr>\n
Geico<\/td>\n$0.84<\/td>\n$1.4<\/td>\n7.9%<\/td>\n<\/tr>\n
State Farm<\/td>\n$0.99<\/td>\n$1.11<\/td>\n16.2%<\/td>\n<\/tr>\n
Allstate<\/td>\n$0.65<\/td>\n$1.87<\/td>\n11.6%<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n

Progressive and Allstate, in particular, pushed their ad budgets to record heights, and raked in significant premium growth as a result.<\/p>\n

But State Farm saw the second-highest growth out of the four insurers, despite raising its 2024 ad budget by just $120 million. State Farm also received the highest shopping satisfaction rating out of the four major insurers in J.D. Power\u2019s 2025 shopping study.<\/p>\n

How to weather the shopping surge: Keep non-cost factors on your radar<\/h2>\n

State Farm\u2019s success on a low ad budget doesn\u2019t just hold lessons for other insurers. It\u2019s also a reminder for shoppers that when it comes to insurance, customer service matters \u2014 cost isn\u2019t everything.<\/p>\n

If you\u2019re shopping for car insurance, homeowners insurance or both in 2025, you may be tempted to make a lower price your primary goal. But the cheapest insurance company is not always the best for your needs. As you shop, use some of the following strategies to balance price concerns with quality of service:<\/p>\n