UK Private Motor Insurance 2007 (Customer Focus)

Published by: Datamonitor

Published: Sep. 20, 2007 - 36 Pages

Table of Contents

DATAMONITOR VIEW

CATALYST

SUMMARY

ANALYSIS

The telephone remained the largest platform for arranging a motor policy in 2007 but the internet platform is growing fast

The telephone and face-to-face platforms have been declining steadily

More consumers are turning to the internet to arrange their motor policies

Retention rates vary by age of consumer and platform used to arrange insurance

The majority of motor consumers will stay with the same provider at the time of renewal

More than a third of consumers who purchased their motor insurance online switched provider at renewal

Consumers purchasing their motor policies face-to-face, by phone or via post are unlikely to change provider

Switching providers is more prevalent among younger consumers

Price remained the main reason for taking out a motor policy across platforms and ages

Consumers purchasing a policy via the internet are more likely to be motivated by cheaper quotes than others

Consumers over the age of 55 are less sensitive to price than younger consumers

The way in which consumers seek information about motor insurance varies relative to age

Previous experience is the most popular source of information and is used more as a consumer gets older

Younger consumers are more likely to use web sources

Television advertisements are used by 14% of consumers overall

Mailshots, brochures and broker advice are mainly used by older people

Advertising for motor insurance products remained dominated by the television campaigns of direct insurers in 2006

Motor insurance advertising increased by 2.3% in 2006 to almost £200 million

Advertising is dominated by insurers, but brokers narrowed the gap in 2006

The top 10 motor advertisers in 2006 consist primarily of direct insurers

The spend of the top 10 grew slightly in 2006, driven mainly by the substantial increases of four motor insurance advertisers

The top 10 motor advertisers focus on television advertising, reflecting the need for direct insurers in particular to build up brand awareness

Most of the largest motor advertisers spent the majority of their budgets on television advertising in 2006

Direct mail advertising is used by most of the top 10 to complement their television campaigns

Press, outdoor and radio advertising were used sparingly by the top 10 motor insurance advertisers in 2006

The smaller advertising budgets of advertisers ranked 11-20 were more evenly split between television and direct mail

The list of advertisers ranked 11-20 contains a more varied mix of providers

Direct mail was the most favored medium among advertisers ranked 11-20

Television advertising was also very important to competitors ranked 11-20 in 2006

Advertisers ranked 11-20 spent smaller amounts on marketing in radio, the press and outdoor

Television remains the most important medium for motor insurance providers

Direct mail remains an important advertising medium, having increased as a proportion of motor insurers budgets

Direct Line remains the leader in brand awareness in 2007

APPENDIX

Definitions

Channel

Direct insurer/writer/channel

Platform

Supplementary data

Methodology

Advertising statistics

Isis MORI methodology and contacts

Sample design

Further reading

Ask the analyst

Datamonitor consulting

Disclaimer

List of Tables

Table 1: Distribution of private motor insurance, by platform, 2003-07

Table 2: Private motor retention rates, 2003-07

Table 3: Propensity to switch motor provider and likelihood of getting other quotes, by distribution platform, 2007

Table 4: Private motor retention rates by age, 2003-07

Table 5: Motivations for taking out a motor insurance policy, by distribution platform, 2007

Table 6: Reasons for choosing current motor insurance policy by age, 2007

Table 7: Sources of information for motor policy, by age, 2007

Table 8: Advertisement spending by type of insurance provider, 2006

Table 9: Top 10 motor insurance advertisers, 2004-06

Table 10: Top 10 motor insurance advertisers' spend by media, 2006

Table 11: Motor insurance advertisers' spending by media, 2006

Table 12: Top 10 TV advertisers, 2006

Table 13: Top 10 direct mail advertisers, 2005-6

Table 14: Top 10 motor insurers by advertising spend and brand awareness of motor insurers, 2007

Table 15: Top 10 insurance providers by spontaneous recognition, 2007

Table 16: Top 10 insurance providers by spontaneous recognition, 2006

List of Figures

Figure 1: The percentage of consumers arranging their motor insurance online has been increasing steadily since 2003

Figure 2: Around three quarters of motor insurance consumers stay with the same company at renewal

Figure 3: Consumers purchasing their motor insurance online were more likely to change their insurance provider in 2007

Figure 4: Older consumers were more likely to stay with their current providers in 2007

Figure 5: Obtaining a cheaper quote was the most common reason for choosing a provider across all distribution platforms in 2007

Figure 6: Reputation was a factor more valued by older consumers than younger ones in 2007

Figure 7: Use of web-based materials was most common among young consumers in 2007

Figure 8: Most older consumers value previous experiences with providers in 2007

Figure 9: Insurers dominate advertising spend for motor insurance, but brokers' spend grew in 2006

Figure 10: Television remained the medium of choice for most of the top 10 advertisers in 2006

Figure 11: Television and direct mail account for almost 90% of spending by advertisers ranked 11-20

Figure 12: Spontaneous consumer awareness of motor insurers against advertising expenditure, 2006

Abstract

• Statistics on consumer purchasing trends in the UK motor insurance market
• Data on advertising spend by medium for the top motor insurance advertisers in 2006

• Understand what motivates consumers to buy motor insurance and which consumers are most likely to switch provider at renewal
• Gain vital knowledge of the advertising strategies of the top motor insurance advertisers

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