Australia’s increasingly competitive vehicle insurance market has changed the way motorists insure their cars. Automatic renewal of policies each year is no longer a foregone conclusion, with the number of customers switching insurers or shopping around for a better deal steadily rising in the last few years. So who’s most likely to switch insurers? Women aged between 25 and 49.
In the year to February 2014, some 1.7 million people (or 12.3% of car insurance customers) approached another company before renewing their policy with the same insurer — an increase of well over 50% on the nearly 1.1 million people (8.0%) who shopped around in the year to February 2011.
Although more than three quarters (78.2%) of car insurance customers still renew their policy automatically, this has declined from 84.7%, a downward trend that looks set to continue.
Meanwhile, the new entrants’ market has grown from 3.4% in February 2011 to 4.9% now, in line with population growth and the increasing number of registered vehicles nationally. The proportion of switchers has grown by nearly a third over the same period (from 5.6% to 7.4%).
Actions with vehicle insurance in the last 12 months
Source: Roy Morgan Single Source (Australia), 12 month moving average, Average Sample = 37,341 Base: Australians 14+ with a Vehicle Insurance policy
These are the latest findings from the Roy Morgan Consumer Single Source Survey of over 50,000 interviews per annum.
Norman Morris, Industry Communications Director, Roy Morgan Research, says:
“No longer dominated by a few big names, the Australian car insurance market has become more competitive with the emergence of new, niche providers offering motorists more choice than ever. This has resulted in an increasing number of customers switching insurers or at least shopping around, while automatic renewal of policies gradually decreases.
“A closer look at customers who shop around before renewing with the same insurer reveals that they’re most likely to be over 35 and married, probably with kids, and likelier to live in NSW than any other state. Women comprise the majority of switchers, with those aged between 25 and 49 being particularly active in this respect. Perhaps not surprisingly, more than half of new entrants into the car insurance market are under 35 years old.
“A detailed understanding of which types of customers are most likely to shop around or switch insurers is invaluable for car insurance providers keen to tailor their marketing strategies so that they reach a more responsive, relevant audience.”
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Roy Morgan Research
Roy Morgan Research is Australia's best known and longest established market research and public opinion survey company. Roy Morgan Single Source is thorough, accurate, and provides comprehensive, directly applicable information about current and future customers. It is unique in that it directs all the questions to each individual from a base survey sample of around 55,000 interviews in Australia and 15,000 interviews in New Zealand annually - the largest Single Source databases in the world. The questions asked relate to lifestyle and attitudes, media consumption habits (including TV, radio, newspapers, magazines, cinema, catalogues, pay TV and the Internet), brand and product usage, purchase intentions, retail visitations, service provider preferences, financial information and recreation and leisure activities. This lead product is supported by a nationally networked, consultancy-orientated market research capability.
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