Credit agency TransUnion’s latest Insurance Trends Survey showed that 59% of South African motorists said they shopped around for better car insurance in the last six months, and 41% said they intended to do so in the next six months.
Additionally, 55% of survey respondents said they switched away from their original insurance providers once they had shopped around for other policies, highlighting a major vulnerability for insurers.
The reason for the desire to change cover providers primarily comes down to lower premiums.
Cheaper monthly costs were the biggest reason (41%) for insured motorists making the switch, with this trend being most pronounced among 59% of 46-75-year-olds, indicating a strong cost-sensitivity among this group.
Furthermore, nearly one quarter (23%) of respondents changed providers because the new insurer offered better comprehensive coverage, while 15% opted to jump ship for better customer service.
Conversely, a 24% share of voters stayed with their existing providers due to long-term relationships and satisfaction with their providers. This was particularly prominent among 46–55-year-olds where the rate was 38%.
Another 21% kept the status quo because of receiving lowered premiums from their current insurers.
In comparison to car insurance, home insurance policyholders were far less likely to switch providers.
Just over half (57%) of the TransUnion survey participants chose to stay with their incumbent insurer, likely due to being satisfied with their current coverage, or reluctance to navigate the complexities of switching.
“These insights highlight the critical areas that insurers must focus on if they are to attract new policyholders, and to retain their existing customer base,” said Schalk Fischer, Insurance Vertical Sales Leader at TransUnion Africa.
“Competitive pricing, comprehensive coverage, and exceptional customer service are consumers’ leading priorities, and insurers can help them overcome their current financial pressures by seizing the opportunity to engage with them through innovative, tailored products.”
These include flexible offerings, for instance, usage-based insurance, which could address financial strains and prevent insurance gaps that expose consumers to risk.
Points of contact
The method through which local drivers obtained car insurance quotes varied significantly among surveyed consumers.
Customer service/call centres emerged as the preferred channel with 46% of individuals choosing to speak to a consultant before signing a contract.
“Interestingly, this method was particularly favoured by older adults aged 66–75, with a notable 53% preference rate among this demographic, emphasizing a preference for personalised assistance and guidance in insurance matters,” said Fischer.
Websites were a close second at 44%, being particularly prevalent among younger adults aged 25–35 where the adoption rate soared to 53%.
Comparative quote websites were the next most popular choice at 41%, with 43% of people aged 25–45 preferring these platforms.
This suggests a shift toward online offerings that facilitate comparison shopping for car insurance policies and offer transparency and ease in comparing insurance policies, concluded Fischer.
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