Number of drivers shopping for lower insurance rates up 6%

The number of U.S. customers shopping for auto insurance in the first quarter was 6% higher than a year earlier, according to credit reporting agency TransUnion, underscoring efforts to cut costs as inflation squeezes consumer wallets.

WHY IT’S IMPORTANT

Insurance shopping refers to the practice of evaluating different policies to seek out the one best suited to a customer’s needs.

Customers shop for insurance more actively during times of financial strain to look for policies with cheaper premiums.

Auto insurance costs in April climbed 22.6% from a year earlier, according to the Bureau of Labor Statistics, which is the largest annual increase since the 1970s.

CONTEXT

The surge was driven by a jump in costs associated with repairing increasingly complicated vehicles. Frequent vehicle damage due to adverse weather has also prompted insurers to charge higher premiums to account for losses incurred when they pay out customers’ claims.

KEY QUOTE

“As insurers see improved profitability, it’s likely that some will cautiously increase investments in customer acquisition,” Stothard Deal, vice president of strategic planning for TransUnion’s insurance business, said.