TransUnion: Inflation squeezes the insurance market

TransUnion: Inflation squeezes the insurance market

TransUnion’s Quarterly Report on Personal Lines Insurance Trends & Perspectives examined the trends in the market for insurance from April 2021 through October 2022.

According to the report inflation is “putting the squeeze onto insurers” in multiple directions.

Sunday’s screening of 2.56 million passengers by air in the United States was the highest since 2019.

Although labor and materials are more costly, consumers have less power to spend and can rebel against rate increases. The number of auto and property insurance customers is decreasing year-on-year.

TransUnion: Inflation squeezes the insurance market

In the third quarter, however, auto insurance shopping increased. TransUnion stated that some of this could be attributed to the increase in new vehicle sales, which further increased insurance shopping.

TransUnion says that auto premium prices are another key driver of shopping. Rates are rising because of multiple factors that have driven up loss costs. This is leading to an increase in road time for some.

TransUnion’s internal analysis shows that the proportion of auto loan inquirers in the past 30 days is continuing to fall, at an average of one in six quotes. This suggests that shopping may be due to other factors than vehicle purchases.

In Q3, the number of people shopping for property insurance increased. TransUnion stated that although real estate sales are a major driver, another factor driving this increase in property insurance was the rise in auto rates. Because many consumers bundle their insurance policies together and see a significant increase in auto shopping, some may look for a new provider for their entire bundle.

The report concluded that inflation, concerns about a recession, and changing consumer spending habits are changing the way consumers spend money. This will have a direct impact on the insurance industry. The affordability of insurance is being challenged by rising interest rates, vehicle costs, and insurance premiums.

WTW data earlier this year revealed that motor claims inflation in the UK is on the rise. This trend will continue into 2022.

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