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Consumers not so predictable in insurance ‘switching’ survey p2

Mon Mar 10th, 2014 on     Homeowners Insurance,    

A friend of ours plays a game she calls “Rather.” Players are given two bad choices and must choose one over the other. The choices range from the innocent to the gruesome: Would you rather be the Scarecrow or the Tin Man? Or, a Florida favorite, would you rather be attacked by an alligator or have to relive high school?

The game came up in a discussion about the Accenture PLC survey we talked about in our last post. While not a straightforward “Rather” question, the survey asked if respondents would consider buying insurance from a company that is not an insurer. Only 43 percent said they would think about purchasing a policy from a bank. And, while 23 percent said they would consider going to an online provider like Amazon or Google, only 14 percent said they would purchase coverage from a retailer.

Among the factors informing the choice of a new carrier, lower prices were rated as important or very important. However, wanting lower prices and actively looking for them are not the same thing, it seems. Less than half (40 percent) of policyholders plan to change auto or home insurance companies over the next 12 months.

With home and auto insurance, though, consumers do not usually have the option of not purchasing coverage. In Florida, for example, anyone registering a vehicle must have insurance. The state does not require homeowners insurance, but mortgage lenders may.

Life insurance is more of a personal decision. Ask your friends how many of them would buy a policy if their employers did not pay for it or subsidize the cost? So the researchers approached life insurance switching behaviors a little differently.

The survey asked if respondents would cancel an existing policy in the coming year, and 25 percent of them said yes. Again, the responses in the U.S. — as we said in our last post, the respondents were from 11 countries — may have been colored by employer-sponsored coverage.

As for purchasing a life insurance policy over the next 12 months, 35 percent of respondents said they were likely to buy new coverage.

The survey turned up some interesting information about insurers’ use of mobile technology and the switching behaviors for each country. We may come back to the report in future posts.

Source: Carrier Management, “Nearly One-Quarter of Insurance Consumers Would Buy Cover from Amazon, Google: Accenture,” Feb. 6, 2014

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