Auto insurance

US consumers prefer local branches for home and auto insurance

A majority of policyholders feel that their insurer treats them as individuals and 69% agree with the statement: “My insurance company cares about its customers”. (Credit: Svitlana/Adobe Stock)

When it comes to applying for coverage for a vehicle or home, U.S. consumers prefer to go through a local insurance branch, according to research by Duck Creek Technologies, which also reported that Canadian policyholders show a propensity for brokers when purchasing vehicles and critical illness insurance plans.

Nearly half of U.S. policyholders surveyed said they preferred a local branch when researching home contents or buildings insurance policies, while 35% worked through a broker and 35% purchased directly from an insurer. For auto, van and motorcycle policies, 59% of US consumers favor local agencies, compared to 28% who went through a broker and 39% who bought directly, according to Duck Creek.

The tendency to favor brokers was most pronounced in Canada, where 31% purchased car, van or motorcycle insurance through a broker, while 23% of those seeking coverage for the contents of house/building turned to brokers. According to Duck Creek, less than 10% of consumers in both lines leveraged insurance directly from an insurance provider and through a local branch.

This makes policyholders in both countries special cases, as the overwhelming majority of global consumers said they prefer buying directly from insurers for all types of policies. However, more than 25% of all purchases were made through brokers or other third parties, Duck Creek reported, noting that this shows the importance of distribution management for the P&C insurance industry.

All calm on the front of the house

Except when filing a claim, 32% of consumers worldwide said they don’t hear from their insurers annually, Duck Creek reported.

This trend stands out the most for home insurance, with 35% of consumers reporting never hearing from their home insurance company and an equal number of hearings reporting only once a year. Only 11% communicate with the company twice a year. For car policyholders, 29% of policyholders say they never receive communications from their insurer, while 36% receive one per year and 17% say they hear two per year.

However, this level of commitment does not leave policyholders feeling overlooked. A majority (68%) believe that their insurer treats them as individuals and 69% agree with the statement: “My insurance company cares about its customers”.