Auto insurance shopping saw a significant uptick of 10% in the first quarter of 2025 compared to the same period in 2024, while home insurance shopping rose by 5%, according to a recent report from TransUnion. This marks a notable shift in consumer behavior, as higher-risk consumers are becoming more prominent in the shopping landscape for the first time since late 2021. This change suggests that insurers may be refocusing their strategies, targeting rate increases more selectively on higher-risk segments rather than implementing across-the-board hikes.
As rates stabilize for many auto insurance customers, the market is seeing a return to historical shopping patterns, which are closely linked to price sensitivity and insurance risk. However, challenges such as the rising costs of vehicle and home repairs due to supply chain issues and increasing natural disasters could lead to a potential resurgence in broad price increases. The report highlights a significant rise in natural disasters, with 27 disasters surpassing $1 billion in costs observed in 2024—more than double the annual average from the previous decade.
In terms of home insurance, shifting demographics are also becoming apparent. The proportion of Millennials owning homes has dropped, with only 41% of them owning homes by 2024, compared to more than half of Generation X in 2009. This is attributed to escalating housing costs, which have made homeownership less accessible for younger generations and contributed to the rise of multi-generational households. In 2024, only 38% of credit-active residents lived alone, down from 45% in 2009. A recent survey indicated that many young adults plan to provide financial support to their parents or grandparents in the coming years.
TransUnion’s senior director Patrick Foy emphasized the need for insurers to adapt their policies and marketing strategies to cater to the evolving household compositions and economic realities of consumers. Tailoring products to fit the unique risk profiles of multi-generational households can help insurers better engage their target audiences.
The insights from the report not only reflect the current trends in the insurance market but also highlight the resilience and adaptability of consumers and insurers alike. As new economic realities unfold, there is a hopeful outlook towards finding innovative solutions to meet diverse needs in the insurance landscape.