Insurers with the strongest new business yield rates also have strong combined ratios in personal auto in the “J.D. Power 2017 U.S. Insurance Shopping Study.”
Executive Summary
Auto insurers with the best new business yield rates are not all leaders in advertising spending nor are they standouts in customer satisfaction. Instead those that deliver average customer experience but stellar combined ratios and effective, targeted advertising content attract high percentages of auto shoppers, a J.D. Power analysis reveals.We define new business yield rates as the proportion of prospective customers who purchase with the insurer after shopping.
Three companies emerge as leaders in profitability and new business yield in personal auto insurance. GEICO, Progressive, and Automobile Club of Southern California, a AAA insurer, all maintain a combined ratio less than 100 (in 2015) while acquiring new business more successfully than the other insurers included in the study. Their yield rates are 7.6 percent (GEICO), 4.3 percent (Progressive) and 4.1 percent (ACSC), respectively—well above the industry average of 2.4 percent (Figure 1).
