Auto Insurance

92% of Policyholders Who Recently Switched Auto Insurance Companies Saved Money, but Most Don’t Seek Additional Quotes

92% of Policyholders Who Recently Switched Auto Insurance Companies Saved Money, but Most Don’t Seek Additional Quotes

26% of those who recently switched to a new insurer saved $200 or more annually, so consumers who don’t shop around might benefit from a fuller picture as they renew.
A mother in the car with her teen driver.
A mother in the car with her teen driver. Source: Getty Images

Rising gas prices throughout the U.S. have strained many household budgets. As a result, many Americans are reevaluating every auto-related expense — auto insurance premiums included.

Yet many auto insurance policyholders don’t shop around to ensure they’re getting the best deal possible where coverage is concerned. The latest ValuePenguin survey of more than 1,200 U.S. auto insurance policyholders finds that almost 40% saw their rates increase the last time their policy was renewed. But 65% of policyholders didn’t take steps to get quotes from other insurance companies.

Key findings

  • 92% of auto insurance policyholders who switched companies during their most recent renewal period saved money. This impact was limited, however, as 65% of policyholders didn’t seek additional quotes during their renewal period.
  • Consumers who generally don’t seek additional quotes might benefit from reconsidering their stance. 39% of consumers who didn’t switch auto insurance companies say theirs offers the best rates. But more than a quarter (26%) of those who recently switched to a new auto insurer saved $200 or more annually, which means those who don’t shop around may not have the full picture when they renew.
  • Whether they shopped around, nearly 40% of auto insurance policyholders saw their rates increase during their most recent renewal period. According to ValuePenguin’s "State of Auto Insurance," rates were expected to increase by an average of 0.6% across the U.S. in 2022.
  • To combat this, nearly 30% of those whose auto insurance rates went up decreased their coverage to save money. While dropping comprehensive insurance lowers your premiums, a March 2022 ValuePenguin survey found that many consumers mistakenly think they’d be covered for car theft or theft-related damage.

Most who switch auto insurance save money, but are enough Americans doing this?

The vast majority of policyholders who switch auto insurance companies save money (92%). And that potential savings can be meaningful, with 26% of policyholders saving $200 or more a year after moving their auto insurance coverage to a new provider (more on this later).

But despite this, most policyholders (65%) don’t get outside quotes for comparison when their auto insurance policies are up for renewal. By region, a higher percentage of policyholders in the Northeast (70%) and West (69%) aren’t shopping around.

Age also appears to play a role in how likely a person is to shop around for better auto insurance rates. Baby boomers — ages 57 to 76 — are most likely not to shop for a lower rate before their policy renewal at 77%. Here’s a closer look:

This is a graph about comparing auto insurance quotes, by generation

Even starker, just 48% of consumers whose auto insurance rates increased during their most recent renewal shopped around for lower insurance premiums. That means the majority didn’t take the time to compare insurance companies — even after their rates rose.

When policyholders shop for additional quotes after a rate increase, they go about the process differently. Here’s how their most recent renewal went:

  • 28% checked rates with just one other insurance company
  • 13% got quotes from two insurance providers
  • 7% made an effort to get three or more quotes from competing insurers

Interestingly, most policyholders (80%) stuck with their original insurer even after shopping around for a lower rate. In fact, 89% of consumers whose rate increased remained with the same auto insurance provider.

This is a graph about switching insurers
{"backgroundColor":"white","content":"\u003C\/p\u003E\n\n\u003Cp\u003EThe vast majority of policyholders who \u003Cspan\u003E\u003Ca class=\"ShortcodeLink--root ShortcodeLink--black\" title=\"Switching Car Insurance Companies: When and How to Do It\" href=\"https:\/\/www.valuepenguin.com\/switching-car-insurance-companies-when-you-should-do-it\"\u003Eswitch auto insurance companies\u003C\/a\u003E\u003C\/span\u003E save money (92%). And that potential savings can be meaningful, with 26% of policyholders saving $200 or more a year after moving their auto insurance coverage to a new provider (more on this later).\u003C\/p\u003E\n\n\u003Cp\u003EBut despite this, most policyholders (65%) don\u2019t get outside quotes for comparison when their auto insurance policies are up for renewal. By region, a higher percentage of policyholders in the Northeast (70%) and West (69%) aren\u2019t shopping around.\u003C\/p\u003E\n\n\u003Cp\u003EAge also appears to play a role in how likely a person is to \u003Cspan\u003E\u003Ca class=\"ShortcodeLink--root ShortcodeLink--black\" title=\"Compare Car Insurance Quotes Online\" href=\"https:\/\/www.valuepenguin.com\/auto-insurance\"\u003Eshop around for better auto insurance rates\u003C\/a\u003E\u003C\/span\u003E. Baby boomers \u2014 ages 57 to 76 \u2014 are most likely not to shop for a lower rate before their policy renewal at 77%. Here\u2019s a closer look:\u003C\/p\u003E\n\n\u003Cp\u003E\u003Cdiv class=\"ShortcodeImageResponsive--root\"\u003E\n \u003Cfigure class=\"ShortcodeImage--root\"\u003E\n \u003Cpicture class=\"ShortcodeImage--picture\"\u003E\n \u003Csource\n media=\"(max-width: 607.5px)\"\n data-srcset=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_1.0,f_auto,h_1600,q_auto,w_1600\/v1\/auto-insurance-gen-m_nvdz8t 1x, https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_2.0,f_auto,h_1600,q_auto,w_1600\/v1\/auto-insurance-gen-m_nvdz8t 2x\"\n\/\u003E\n \u003Cimg alt=\"This is a graph about comparing auto insurance quotes, by generation\" class=\"lazyload\" data-src=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_1.0,f_auto,h_1600,q_auto,w_1600\/v1\/auto-insurance-gen_lijg8j\" src=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_2.0,e_blur:1000,f_auto,h_1600,q_1,w_1600\/v1\/auto-insurance-gen_lijg8j\" data-srcset=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_1.0,f_auto,h_1600,q_auto,w_1600\/v1\/auto-insurance-gen_lijg8j 1x, https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_2.0,f_auto,h_1600,q_auto,w_1600\/v1\/auto-insurance-gen_lijg8j 2x\"\u003E\n \u003C\/picture\u003E\n \u003C\/figure\u003E\n\u003C\/div\u003E\n\u003C\/p\u003E\n\n\u003Cp\u003EEven starker, just 48% of consumers whose auto insurance rates increased during their most recent renewal shopped around for lower insurance premiums. That means the majority didn\u2019t take the time to compare insurance companies \u2014 even after their rates rose.\u003C\/p\u003E\n\n\u003Cp\u003EWhen policyholders shop for additional quotes after a rate increase, they go about the process differently. Here\u2019s how their most recent renewal went:\u003C\/p\u003E\n\n\u003Cp\u003E\u003Cdiv class=\"ShortcodeList--root \"\u003E\n\n \u003Cdiv class=\"ShortcodeList--content ShortcodeList--content-margin\"\u003E\n \u003Cdiv class=\"ShortcodeList--column\"\u003E\n \u003Cul class=\"ListUnordered--root ListUnordered--bullet\"\u003E\n \u003Cli class=\"ListUnordered--list-item\"\u003E\n 28% checked rates with just one other insurance company\n \u003C\/li\u003E\n \u003Cli class=\"ListUnordered--list-item\"\u003E\n 13% got quotes from two insurance providers\n \u003C\/li\u003E\n \u003Cli class=\"ListUnordered--list-item\"\u003E\n 7% made an effort to get three or more quotes from competing insurers\n \u003C\/li\u003E\n \u003C\/ul\u003E\n \u003C\/div\u003E\n \u003C\/div\u003E\n\u003C\/div\u003E\n\n\u003C\/p\u003E\n\n\u003Cp\u003E\u003Cdiv class=\"ShortcodeBorder--root ShortcodeBorder--with-padding\"\u003E\u003C\/p\u003E\n\n\u003Cp\u003EInterestingly, most policyholders (80%) stuck with their original insurer even after shopping around for a lower rate. In fact, 89% of consumers whose rate increased remained with the same auto insurance provider.\u003C\/p\u003E\n\n\u003Cp\u003E\u003C\/div\u003E\u003C\/p\u003E\n\n\u003Cp\u003E\u003Cdiv class=\"ShortcodeImageResponsive--root\"\u003E\n \u003Cfigure class=\"ShortcodeImage--root\"\u003E\n \u003Cpicture class=\"ShortcodeImage--picture\"\u003E\n \u003Csource\n media=\"(max-width: 607.5px)\"\n data-srcset=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_1.0,f_auto,h_1600,q_auto,w_1600\/v1\/auto-insurance-insurer-m_kei23o 1x, https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_2.0,f_auto,h_1600,q_auto,w_1600\/v1\/auto-insurance-insurer-m_kei23o 2x\"\n\/\u003E\n \u003Cimg alt=\"This is a graph about switching insurers\" class=\"lazyload\" data-src=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_1.0,f_auto,h_1600,q_auto,w_1600\/v1\/auto-insurance-insurer_xazxfo\" src=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_2.0,e_blur:1000,f_auto,h_1600,q_1,w_1600\/v1\/auto-insurance-insurer_xazxfo\" data-srcset=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_1.0,f_auto,h_1600,q_auto,w_1600\/v1\/auto-insurance-insurer_xazxfo 1x, https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_2.0,f_auto,h_1600,q_auto,w_1600\/v1\/auto-insurance-insurer_xazxfo 2x\"\u003E\n \u003C\/picture\u003E\n \u003C\/figure\u003E\n\u003C\/div\u003E\n\u003C\/p\u003E\n\n\u003Cp\u003E","padding":"double"}

Why some consumers stay with their insurer — and whether they’re missing out on money

Overall, most policyholders (92%) stayed with the same auto insurance provider during their most recent policy renewal. Yet the reasons that motivated people to stay put with their auto coverage were varied.

Across all policyholders, 39% who didn’t switch auto insurance companies say theirs offers the best rates. Specifically among policyholders who shopped around for a lower insurance premium:

  • 47% decided to stay with their original insurer because it offered the lowest rates
  • 35% stayed with the same insurer because they liked the customer service support
  • 30% didn’t change policies because they bundle auto and home insurance
  • 11% put off making a change due to the hassle of switching insurance providers

As for those who didn’t change insurance providers after a rate increase, most (40%) decided not to make a change due to the bundling of their auto policy with home insurance.

When people change auto insurance carriers, most (92%) are rewarded with lower premiums, as we noted earlier. The amount of money that consumers may save from the switch can vary, but the annual savings comes in between $50 and $99 annually for the largest group (28%).

This is a graph about saving money by switching insurers

It’s no surprise that those who switched to a new auto insurer primarily did so to save money (84%). Yet there are other motivations for change. A desire to try out a new insurer because they heard good things about it (20%) and dissatisfaction with their previous insurance company’s customer service (14%) are two other popular reasons people change insurance providers.

Shopping around or not, nearly 4 in 10 auto insurance policyholders cite rate increases

Rates increased at renewal for close to 40% of auto insurance policyholders. And another 10% of policyholders didn’t know whether their rates went up.

This is a graph about rate increases

Increases in auto insurance premiums can be common. ValuePenguin’s "State of Auto Insurance" predicted that 2022 auto insurance rates could increase by 0.6% on average throughout the U.S. And the expected increase could hit some consumers harder than others.

When asked whether they were struggling to afford their auto insurance premiums, 46% answered yes. Women (52%) were more likely than men (40%) to say that auto insurance premiums were putting their household budget under stress.

The ability to afford auto insurance coverage differs among various age groups, too. Below is a look at the percentage of people who struggle to cover auto insurance costs by generation:

  • Gen Zers (ages 18 to 25): 60%
  • Millennials (ages 26 to 41): 51%
  • Gen Xers (ages 42 to 56): 47%
  • Baby boomers: 34%

Residents of the Northeast admit to struggling to afford auto insurance coverage more than people in other areas of the country. The difference isn’t huge, but nearly half of policyholders in the Northeast (49%) have difficulty paying for auto insurance. By comparison, 44% of people in the Midwest and West feel the same.

{"backgroundColor":"white","content":"\u003C\/p\u003E\n\n\u003Cp\u003ERates increased at renewal for close to 40% of auto insurance policyholders. And another 10% of policyholders didn\u2019t know whether their rates went up.\u003C\/p\u003E\n\n\u003Cp\u003E\u003Cdiv class=\"ShortcodeImageResponsive--root\"\u003E\n \u003Cfigure class=\"ShortcodeImage--root\"\u003E\n \u003Cpicture class=\"ShortcodeImage--picture\"\u003E\n \u003Csource\n media=\"(max-width: 607.5px)\"\n data-srcset=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_1.0,f_auto,h_1600,q_auto,w_1600\/v1\/auto-insurance-rate-inc-m_mqbzzg 1x, https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_2.0,f_auto,h_1600,q_auto,w_1600\/v1\/auto-insurance-rate-inc-m_mqbzzg 2x\"\n\/\u003E\n \u003Cimg alt=\"This is a graph about rate increases\" class=\"lazyload\" data-src=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_1.0,f_auto,h_1600,q_auto,w_1600\/v1\/auto-insurance-rate-inc_bauzgt\" src=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_2.0,e_blur:1000,f_auto,h_1600,q_1,w_1600\/v1\/auto-insurance-rate-inc_bauzgt\" data-srcset=\"https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_1.0,f_auto,h_1600,q_auto,w_1600\/v1\/auto-insurance-rate-inc_bauzgt 1x, https:\/\/res.cloudinary.com\/value-penguin\/image\/upload\/c_limit,dpr_2.0,f_auto,h_1600,q_auto,w_1600\/v1\/auto-insurance-rate-inc_bauzgt 2x\"\u003E\n \u003C\/picture\u003E\n \u003C\/figure\u003E\n\u003C\/div\u003E\n\u003C\/p\u003E\n\n\u003Cp\u003EIncreases in auto insurance premiums can be common. ValuePenguin\u2019s \"State of Auto Insurance\" predicted that 2022 auto insurance rates could increase by 0.6% on average throughout the U.S. And the expected increase could hit some consumers harder than others.\u003C\/p\u003E\n\n\u003Cp\u003EWhen asked whether they were struggling to afford their auto insurance premiums, 46% answered yes. Women (52%) were more likely than men (40%) to say that auto insurance premiums were putting their household budget under stress.\u003C\/p\u003E\n\n\u003Cp\u003EThe ability to afford auto insurance coverage differs among various age groups, too. Below is a look at the percentage of people who struggle to cover auto insurance costs by generation:\u003C\/p\u003E\n\n\u003Cp\u003E\u003Cdiv class=\"ShortcodeList--root \"\u003E\n\n \u003Cdiv class=\"ShortcodeList--content ShortcodeList--content-margin\"\u003E\n \u003Cdiv class=\"ShortcodeList--column\"\u003E\n \u003Cul class=\"ListUnordered--root ListUnordered--bullet\"\u003E\n \u003Cli class=\"ListUnordered--list-item\"\u003E\n Gen Zers (ages 18 to 25): 60%\n \u003C\/li\u003E\n \u003Cli class=\"ListUnordered--list-item\"\u003E\n Millennials (ages 26 to 41): 51%\n \u003C\/li\u003E\n \u003Cli class=\"ListUnordered--list-item\"\u003E\n Gen Xers (ages 42 to 56): 47%\n \u003C\/li\u003E\n \u003Cli class=\"ListUnordered--list-item\"\u003E\n Baby boomers: 34%\n \u003C\/li\u003E\n \u003C\/ul\u003E\n \u003C\/div\u003E\n \u003C\/div\u003E\n\u003C\/div\u003E\n\n\u003C\/p\u003E\n\n\u003Cp\u003EResidents of the Northeast admit to struggling to afford auto insurance coverage more than people in other areas of the country. The difference isn\u2019t huge, but nearly half of policyholders in the Northeast (49%) have difficulty paying for auto insurance. By comparison, 44% of people in the Midwest and West feel the same.\u003C\/p\u003E\n\n\u003Cp\u003E","padding":"double"}

How Americans are combating auto insurance rate increases

Even though most Americans (89%) hold steady with their auto insurance providers after a rate increase, many people take other actions to try to offset higher costs. In particular, 61% of policyholders who saw a rate increase have contemplated decreasing their coverage by switching to liability-only car insurance, dropping add-ons and more. Of this group, 27% have gone beyond contemplation and decreased coverage.

This is a graph about decreasing coverage

Overall, not everyone who contemplated decreasing coverage moved forward. More than one-quarter (29%) of policyholders decided not to adjust their coverage to save money. But 16% did opt for less coverage after weighing their options.

Some of these consumers who reduced their coverage might be confused about how a lack of comprehensive insurance could impact their lives. A recent ValuePenguin survey found that many people have a mistaken belief that liability coverage will protect against car theft and damage from such events.

Another way that many consumers try to save money is by bundling their auto insurance and home insurance together — 55% say they do this. Households with an annual income of $75,000 to $99,999 were most likely to bundle (67%). On the other end of the spectrum, households that earn less than $35,000 a year were the least likely to take advantage of this potential savings opportunity (43%).

More than a quarter of those who bundle their insurance policies together say auto insurance was more important than home when selecting a provider. Yet most policyholders (60%) felt that both auto insurance and home insurance were of equal importance, and they made sure to choose an insurer they believed would provide the best of both types of coverage.

Methodology

ValuePenguin commissioned Qualtrics to conduct an online survey of 1,260 consumers with an auto insurance policy, March 17-24, 2022. The survey was administered using a nonprobability-based sample, and quotas were used to ensure the sample base represented the overall population. All responses were reviewed by researchers for quality control.

We defined generations as the following ages in 2022:

  • Generation Z: 18 to 25
  • Millennial: 26 to 41
  • Generation X: 42 to 56
  • Baby boomer: 57 to 76

While the survey also included consumers from the silent generation (those 77 and older), the sample size was too small to include findings related to that group in the generational breakdowns.