{"id":2499,"date":"2025-12-06T13:41:17","date_gmt":"2025-12-06T13:41:17","guid":{"rendered":"http:\/\/americanfoodsupplies.com\/index.php\/2025\/12\/06\/auto-premium-growth-slows-as-policyholders-shop-around-study-says-2\/"},"modified":"2025-12-06T13:41:17","modified_gmt":"2025-12-06T13:41:17","slug":"auto-premium-growth-slows-as-policyholders-shop-around-study-says-2","status":"publish","type":"post","link":"http:\/\/americanfoodsupplies.com\/index.php\/2025\/12\/06\/auto-premium-growth-slows-as-policyholders-shop-around-study-says-2\/","title":{"rendered":"Auto Premium Growth Slows As Policyholders Shop Around, Study Says"},"content":{"rendered":"<figure class=\"wp-block-image size-large\"><a href=\"https:\/\/insuranceindustryblog.iii.org\/wp-content\/uploads\/2025\/02\/GettyImages-184940623.jpg\"><img decoding=\"async\" loading=\"lazy\" width=\"1024\" height=\"681\" src=\"data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==\" alt=\"\" class=\"wp-image-19553 lazyload\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" data-src=\"https:\/\/insuranceindustryblog.iii.org\/wp-content\/uploads\/2025\/02\/GettyImages-184940623-1024x681.jpg\" data-srcset=\"https:\/\/insuranceindustryblog.iii.org\/wp-content\/uploads\/2025\/02\/GettyImages-184940623-1024x681.jpg 1024w, https:\/\/insuranceindustryblog.iii.org\/wp-content\/uploads\/2025\/02\/GettyImages-184940623-300x200.jpg 300w, https:\/\/insuranceindustryblog.iii.org\/wp-content\/uploads\/2025\/02\/GettyImages-184940623-768x511.jpg 768w, https:\/\/insuranceindustryblog.iii.org\/wp-content\/uploads\/2025\/02\/GettyImages-184940623-1536x1022.jpg 1536w, https:\/\/insuranceindustryblog.iii.org\/wp-content\/uploads\/2025\/02\/GettyImages-184940623-2048x1363.jpg 2048w\"><\/a><\/figure>\n<\/p>\n<p>Improved loss ratios, strong premium growth, and lower retention rates characterized the U.S. auto insurance industry in 2024, according to LexisNexis\u00ae Risk Solutions\u2019&nbsp;<a href=\"https:\/\/risk.lexisnexis.com\/insights-resources\/white-paper\/auto-insurance-trends-report?trmid=INSATOEV.ATREver.ATRFormSub.WSLN-1493610\">2025 U.S Auto Insurance Trends Report<\/a>.<\/p>\n<p>The report shows that, \u201cwhile a number of insurers returned to profitability as the market softened,\u201d the market was characterized by \u201crecord levels of policy shopping and switching, attorney representation, claims severity, and rising driving violations.\u201d<\/p>\n<p>Rate increases over the past two years helped U.S. insurers address profitability issues, the report said. Premium rate increases are beginning to ease, rising 10 percent in 2024, compared with a 15 percent hike in 2023, as market conditions soften. Insurer profitability is improving, with direct written premiums growing 13.6 percent, to $359 billion, and incurred loss ratios stabilizing, enabling some carriers to pursue growth strategies and file for rate decreases.<\/p>\n<p>LexisNexis Risk Solutions also notes that tariffs may factor into how insurers consider rate in 2025. &nbsp;While the market wouldn\u2019t expect the magnitude of activity seen between 2022 through 2024, tariffs, if they stick, could set off a ripple effect of moderate rate increases with implications across the industry.<\/p>\n<p>Other trends identified in the report include:<\/p>\n<ul>\n<li>Bodily injury claims severity jumped 9.2 percent, and property damage severity climbed 2.5 percent, year over year. In contrast, collision severity fell 2.5 percent for the same period.<\/li>\n<li>All driving violations increased 17percent and driving violation rates across the United States surpassed 2019 levels.<\/li>\n<li>Policy shopping reached an all-time high,&nbsp;with more than 45 percent of policies in force shopped at least once by year-end.<\/li>\n<\/ul>\n<p>The report also noted that electric vehicle (EV) transitions are introducing new risks, as drivers moving from internal combustion engine vehicles to EVs experienced a 14 percet rise in claim frequency.<\/p>\n<p>\u201cAuto insurers continue to navigate a dynamic market,\u201d said Jeff Batiste, senior vice president and general manager, U.S. auto and home insurance, LexisNexis Risk Solutions. \u201cThe combination of the market softening and a return to profitability presents a potential new chapter for the industry as insurers encounter a consumer base that is more willing than ever to shop for deals.\u201d<\/p>\n<p>Record levels of auto policy switching translated to 2024\u2019s new policy growth rate of 17.7 percent year over year. It also added momentum to the ongoing&nbsp;customer retention&nbsp;decline across the industry.<\/p>\n<p>Since 2021,&nbsp;retention&nbsp;has decreased five percentage points, to 78 percent, resulting in a 22 percent increase in policy churn, the report says.<\/p>\n<p>\u201cHistorically, dropping even one percentage point is significant,\u201d it says. \u201cHowever, against a backdrop of heightened levels of shopping and switching activity, insurers may want to focus on their&nbsp;retention&nbsp;strategies, especially when long-tenured customers are hitting the market.\u201d<\/p>\n<p><strong><em>Learn More:<\/em><\/strong><\/p>\n<p><a href=\"https:\/\/insuranceindustryblog.iii.org\/litigation-reform-works-florida-auto-insurance-premium-rates-declining\/\">Litigation Reform Works: Florida Auto Insurance Premium Rates Declining<\/a><\/p>\n<p><a href=\"https:\/\/insuranceindustryblog.iii.org\/personal-auto-shines-general-liability-faces-headwinds-in-q3-2025\/\">Personal Auto Shines, General Liability Faces Headwinds in Q3 2025<\/a><\/p>\n<p><a href=\"https:\/\/insuranceindustryblog.iii.org\/personal-auto-2024-underwriting-results-best-since-pandemic\/\">Personal Auto 2024 Underwriting Results Best Since Pandemic<\/a><\/p>\n<p><a href=\"https:\/\/insuranceindustryblog.iii.org\/even-with-recent-rises-auto-insurance-is-more-affordable-than-during-most-of-century-to-date\/\">Even With Recent Rises, Auto Insurance Is More Affordable Than During Most of Century to Date<\/a><\/p>\n<p><a href=\"https:\/\/insuranceindustryblog.iii.org\/new-irc-reportpersonal-auto-insurancestate-regulation-systems\/\">New IRC Report: Personal Auto Insurance State Regulation Systems<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Improved loss ratios, strong premium growth, and lower retention rates characterized the U.S. auto insurance industry in 2024, according to LexisNexis\u00ae Risk Solutions\u2019&#160;2025 U.S Auto Insurance <\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[19],"tags":[],"class_list":["post-2499","post","type-post","status-publish","format-standard","hentry","category-auto-insurance"],"_links":{"self":[{"href":"http:\/\/americanfoodsupplies.com\/index.php\/wp-json\/wp\/v2\/posts\/2499","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/americanfoodsupplies.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/americanfoodsupplies.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"http:\/\/americanfoodsupplies.com\/index.php\/wp-json\/wp\/v2\/comments?post=2499"}],"version-history":[{"count":0,"href":"http:\/\/americanfoodsupplies.com\/index.php\/wp-json\/wp\/v2\/posts\/2499\/revisions"}],"wp:attachment":[{"href":"http:\/\/americanfoodsupplies.com\/index.php\/wp-json\/wp\/v2\/media?parent=2499"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/americanfoodsupplies.com\/index.php\/wp-json\/wp\/v2\/categories?post=2499"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/americanfoodsupplies.com\/index.php\/wp-json\/wp\/v2\/tags?post=2499"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}