UK Personal Insurance Consumers 2007

DATAMONITOR VIEW 1
CATALYST 1
SUMMARY 1
ANALYSIS 2
The internet continued to gain market share in 2007, although telephone remained the dominant platform 2
The telephone remained the largest platform for arranging a motor policy in 2007, but the internet platform is growing fast 2
The telephone and face-to-face platforms have been declining steadily among motor insurance consumers 2
More consumers are turning to the internet to arrange their motor policies 2
Face-to-face arrangements of household insurance policies continue to decline in favor of phone and internet 4
Face-to-face distribution of household insurance has been declining for several years 4
The number of consumers arranging household insurance online or over the telephone grew in 2007 4
Consumers' insurance purchasing behavior varies by age and income 6
The internet is most popular among younger consumers as a platform for purchasing motor and household insurance 6
Arranging home or motor insurance over the telephone remained the most popular option for consumers, regardless of age 7
The face-to-face platform was most popular among older consumers in 2007 9
The face-to-face platform was most popular among low-income consumers 10
Affluent motor insurance consumers were the most likely to have purchased their insurance online in 2007 12
Arranging insurance over the telephone was popular at all income levels in 2007 13
Consumers' propensity for switching provider varies by platform used 15
More than a third of consumers who purchased their motor insurance online switched provider at renewal 15
Consumers purchasing their motor policies face-to-face, by phone or via post are unlikely to change provider 15
Consumers are more likely to switch if they purchase their household insurance online 17
Switching provider is more prevalent among younger consumers 19
Motor insurance consumers become less likely to change their provider as they age 19
The loyalty of household insurance consumers also increases with age 21
Online consumers are more price-conscious than consumers buying via other platforms 22
Consumers purchasing a motor policy via the internet are more likely to be motivated by cheaper quotes than others 22
Online household insurance consumers show greater price sensitivity than consumers using other platforms 24
APPENDIX 27
Definitions 27
Channel 27
Direct insurer/writer/channel 27
Platform 27
Methodology 27
Ipsos MORI methodology and contacts 27
Sample design 28
Further reading 28
Ask the analyst 29
Datamonitor consulting 29
Disclaimer 29
List of Tables
Table 1: Distribution of private motor insurance, by platform, 2003-07 3
Table 2: Distribution of household insurance, by platform, 2003-07 5
Table 3: Consumers buying motor and household insurance via the internet, by age group, 2005-07 7
Table 4: Consumers buying motor and household insurance by telephone, by age group, 2005-07 8
Table 5: Consumers buying motor and household insurance face-to-face, by age group, 2005-07 10
Table 6: Consumers buying motor and household insurance face-to-face, by income, 2005-07 11
Table 7: Consumers buying motor and household insurance via the internet, by income, 2005-07 13
Table 8: Consumers buying motor and household insurance by telephone, by income, 2005-07 14
Table 9: Propensity to switch motor provider and likelihood of getting other quotes, by distribution platform, 2007 17
Table 10: Propensity to switch household provider and likelihood of getting other quotes, by distribution platform, 2007 19
Table 11: Private motor retention rates by age, 2003-07 20
Table 12: Household insurance retention rates by age, 2007 22
Table 13: Motivations for taking out a motor insurance policy, by distribution platform, 2007 24
Table 14: Motivations for taking out a new household insurance policy, by distribution platform, 2007 26
List of Figures
Figure 1: The percentage of consumers arranging their motor insurance online has been increasing steadily since 2003 3
Figure 2: Phone remains the largest distribution platform for household insurance in 2007 5
Figure 3: Younger consumers were most likely to purchase home or motor insurance online in 2007 6
Figure 4: Consumers of every age group remain most comfortable arranging their insurance by telephone 8
Figure 5: The proportion of motor insurance bought face-to-face increased with age 9
Figure 6: The face-to-face platform declined in popularity among more affluent consumers in 2007 11
Figure 7: Consumers in the highest income brackets were most likely to buy motor and household insurance via the internet in 2007 12
Figure 8: Use of the telephone to arrange household insurance rose slightly relative to household income in 2007 14
Figure 9: Consumers purchasing their motor insurance online were more likely to change their insurance provider in 2007 16
Figure 10: Consumers are most likely to switch from an insurance provider when they purchase their household insurance online in 2007 18
Figure 11: Older consumers were more likely to stay with their current providers in 2007 20
Figure 12: Consumer loyalty increased with age among household insurance consumers in 2007 21
Figure 13: Obtaining a cheaper quote was the most common reason for choosing a provider across all distribution platforms in 2007 23
Figure 14: There is a greater price awareness among consumers who purchase their household insurance online in 2007 25