Targeting the 30-44 year-old Consumer in UK General Insurance 2003

Published by: Datamonitor

Published: Jun. 9, 2003 - 263 Pages

Table of Contents

CHAPTER 1 EXECUTIVE SUMMARY

Insurance Consumers

Consumer Awareness

Consumer Purchasing Behavior

Customer Retention and Attrition

CHAPTER 2 INTRODUCTION

What is this report about?

A note on indexing

Who is the target reader?

How to use this report

CHAPTER 3 INSURANCE CONSUMERS

Introduction

Key findings

Insurance market context

Private motor drives personal insurance GWP

30-44 year olds in context

30-44 year old age group accounts for 22.6% of total population

30-49 year olds spend more on insurance products than any other age group

Motor insurance consumers in context

Vehicle registrations approach 30 million

Number of no-car households is falling steadily

30-49 year olds are most likely to hold a UK driving license

Household insurance consumers in context

Number of UK households heading towards 25 million

The majority of 30-44 year olds live in owner-occupied households

Health insurance consumers in context

Number of private medical policyholders on the wane

Medical insurance expenditure increases with age

General insurance cover

Motor insurance is the most commonly held insurance type among 30-44 year olds

Key target for insurers is the £40,000-£49,999 income band

Married consumers have a greater tendency to be insured

Home ownership has a positive impact on likelihood of insurance ownership

CHAPTER 4 CONSUMER AWARENESS

Introduction

Key findings

Sources of information used to find an insurer

Directories and previous dealings remain popular in motor insurance

30-44 year old household insurance customers rely on previous dealings

Advertising spend by competitor

Motor insurance advertising boomed in 2002

Household insurers keen on direct mail

BUPA and HSA lead health insurance advertising spend

Advertising Summary

Advertising awareness among 30-44 year olds

30-44 year olds are most aware of advertising by Churchill and Direct Line

Consumer brand awareness

Direct Line is the first name on 30-44 year old consumers’ lips

Direct Line zooms ahead in motor insurance recognition

Direct Line is the most recognized direct household insurance brand

CHAPTER 5 CONSUMER PURCHASING BEHAVIOR

Introduction

Key findings

Selection criteria

Pricing is the driving factor for 30-44 year olds in choosing motor insurance

30-44 year old household insurance customers seek cheapest quotes

Distribution channels and platforms used by 30-44 year old consumers

Motor insurance customers tend to contact providers direct

Mortgage providers play a role in household insurance purchase

Competitor shares of 30-44 year old consumers

Direct Line accelerates ahead of motor competitors

Lloyds TSB is the leading provider of household insurance to 30-44 year olds

CHAPTER 6 CUSTOMER RETENTION AND ATTRITION

Introduction

Key findings

Customer switching among 30-44 year olds

30-44 year olds are most fickle motor insurance customers

30-44 year olds are also most fickle household insurance customers

Attrition by competitor

Churn highest among most established motor providers

Eagle Star has the least fickle 30-44 year old household insurance customers

Likelihood of shopping for alternative quotes amongst 30-44 year olds

Motor insurance consumers are likely to look around

30-44 year olds are a stable consumer segment in household insurance

Likelihood of competitors’ policyholders shopping around

Churchill’s customers most likely to shop around for motor insurance

Direct Line’s household insurance customers are the most unsettled

Number of quotes obtained by 30-44 year olds

Motor insurance consumers tend to compare many quotes

30-44 year old consumers most likely to obtain four or five household quotes

Number of alternative quotes, by competitor

AA and CIS are best positioned to minimise shopping around in motor insurance

Bancassurance customers happiest not to shop around in household insurance

Customer satisfaction among 30-44 year olds

Indifference prevails among 30-44 year old motor insurance customers

30-44 year olds are a particularly demanding age group in household insurance

CHAPTER 7 SUMMARY

30-44 year old consumer profile matrix

Key observations

CHAPTER 8 APPENDIX

Research methodology

MFS Financial Services (MFS) methodology and contacts

MFS survey data

Insurance Consumers

Consumer Awareness

Consumer Purchasing Behavior

Consumer Retention and Attrition

Definitions

Bibliography

Future readings

Do you need more information?

Datamonitor Financial Services Consulting

SPP writing team

How to contact experts in your industry

List of Tables

Table 2: Age structure of UK population, 2001

Table 3: Household expenditure by age of head of household, UK 2001

Table 4: Vehicle registrations in UK, 1991-2001

Table 5: Households owning cars in UK, 1990-2001

Table 6: Full driving license holders in UK by age, 1975-2001

Table 7: Full driving license holders in UK by age and sex, 1975-2001

Table 8: Size of UK households by number of people, 1971-2002

Table 9: Household tenure in UK by age, 2001

Table 10: Number of UK medical insurance holders, 1990-2001

Table 11: Annual medical insurance expenditure by age, 2000-1

Table 12: Insurance cover by age group and type

Table 13: Household and motor insurance expenditure by age of head of household, 2001/2

Table 14: Medical insurance ownership by age and type

Table 15: Medical insurance expenditure by age of head of household, 2001/2

Table 16: Insurance cover among 30-44 year olds, by income

Table 17: Medical insurance ownership among 30-44 year olds, by income

Table 18: Insurance ownership among 30-44 year olds, by marital status

Table 19: Medical insurance ownership among 30-44 year olds, by marital status

Table 20: Insurance ownership among 30-44 year olds, by household tenure

Table 21: Sources of information used to find a motor insurer, by age

Table 22: Sources of information used by 30-44 year olds to find a motor insurer, by income

Table 23: Sources of information used to find a household insurer, by age

Table 24: Sources of information used by 30-44 year olds to find a household insurer, by income

Table 25: Advertising expenditure by motor insurers, by medium, 2002

Table 26: Change in advertising expenditure by motor insurer, 2001-2

Table 27: Advertising expenditure by household insurers, 2002

Table 28: Change in advertising expenditure by household insurer, 2001-2

Table 29: Advertising expenditure by accident and health insurers, 2002

Table 30: Change in advertising expenditure by accident and health insurer, 2001-2

Table 31: Insurance advertising expenditure by sector and medium, 2002

Table 32: Prompted awareness of general insurance advertising by 30-44 year olds

Table 34: Prompted awareness of general insurance advertising among 30-44 year olds, by marital status

Table 35: Unprompted awareness of general insurers among 30-44 year olds

Table 36: Prompted awareness among 30-44 year olds of direct motor insurance providers

Table 37: Prompted awareness among 30-44 year olds of direct motor insurance providers, by income

Table 38: Prompted awareness among 30-44 year olds of direct motor insurance providers, by marital status

Table 39: Prompted awareness among 30-44 year olds of direct household insurance providers

Table 40: Prompted awareness among 30-44 year olds of direct household insurance providers, by income

Table 41: Prompted awareness among 30-44 year olds of direct household insurers, by marital status

Table 42: Motor insurance distribution via channel, by age group

Table 43: Motor insurance distribution via channel among 30-44 year olds, by income

Table 44: Motor insurance distribution via platform, by age group

Table 45: Motor insurance distribution via platform among 30-44 year olds, by income

Table 46: Household insurance distribution via channel, by age group

Table 47: Household insurance distribution via channel among 30-44 year olds, by income

Table 48: Household insurance distribution via platform, by age group

Table 49: Household insurance distribution via platform among 30-44 year olds, by income

Table 50: Proportion of motor insurance customers aged 30-44, by competitor

Table 51: Indexed share of 30-44 year old motor insurance customers, by income

Table 52: Proportion of 30-44 year old household insurance consumers, by competitor

Table 53: Indexed proportion of 30-44 year old household insurance customers, by income

Table 54: Incidence of customer switching, motor insurance by age group

Table 55: Incidence of 30-44 year old customer switching in motor insurance, by income

Table 56: Incidence of customer switching, household insurance by age group

Table 57: Incidence of 30-44 year old customer switching in household insurance, by income

Table 58: Likelihood of shopping around for motor insurance quotations, by age group

Table 59: Likelihood among 30-44 year olds of shopping around for motor insurance quotations, by income

Table 60: Likelihood among 30-44 year olds of shopping around for motor insurance quotations, by marital status

Table 61: Likelihood of shopping around for household insurance quotations by age group

Table 62: Likelihood among 30-44 year olds of shopping around for household insurance quotations, by income

Table 63: Likelihood among 30-44 year olds of shopping around for household insurance quotations, by marital status

Table 64: Likelihood of shopping around for motor insurance quotations, by competitor

Table 65: Likelihood of shopping around for household insurance quotations, by competitor

Table 66: Number of quotes obtained by 30-44 year old motor insurance customers

Table 67: Number of quotes obtained by 30-44 year old household insurance customers

Table 68: Number of alternative motor insurance quotes obtained by 30-44 year olds, by competitor

Table 69: Number of alternative household insurance quotes obtained by 30-44 year olds, by competitor

Table 70: 30-44 year old customer satisfaction, motor insurance

Table 71: 30-44 year old customer satisfaction, household insurance

Table 72: 30-44 year old consumer profile matrix

Table 73: Relative likelihood of general insurance ownership among 30-44 year olds

Table 74: Relative likelihood of medical insurance ownership among 30-44 year olds

Table 75: Sources of information used by 30-44 year olds to find a general insurer

Table 76: Relative likelihood of 30-44 year olds choosing a source for motor insurance

Table 77: Relative likelihood of 30-44 year olds choosing a source for household insurance

Table 78: Relative awareness of general insurers’ advertising campaigns by 30-44 year olds

Table 79: Relative awareness of general insurance advertising among 30-44 year olds, major competitors by income band

Table 81: Relative unprompted awareness of general insurers among 30-44 year olds

Table 82: Unprompted awareness among 30-44 year olds of general insurers, by income

Table 83: Unprompted awareness among 30-44 year olds of general insurers, by marital status

Table 84: Relative prompted awareness among 30-44 year olds of direct motor insurers

Table 85: Relative awareness of direct motor insurance providers among 30-44 year olds, major competitors by income band

Table 86: Relative awareness of direct motor insurance providers among 30-44 year olds, major competitors by marital status

Table 87: Relative prompted awareness among 30-44 year olds of direct household insurers

Table 88: Relative awareness of direct household insurance providers among 30-44 year olds, major competitors by income band

Table 89: Relative awareness of direct household insurance providers among 30-44 year olds, major competitors by marital status

Table 90: Selection criteria for choosing a motor insurance provider by age, relative shares

Table 91: Selection criteria for choosing a motor insurance provider by income, relative shares

Table 92: Selection criteria for choosing a household insurance provider by age, relative shares

Table 93: Selection criteria for choosing a household insurance provider by income, relative shares

Table 94: Motor insurance distribution channels among 30-44 year olds, relative share

Table 95: Motor insurance distribution platforms among 30-44 year olds, relative share

Table 96: Household insurance distribution channels among 30-44 year olds, relative share

Table 97: Household insurance distribution platforms among 30-44 year olds, relative share

Table 98: Relative share of 30-44 year old motor insurance customers, by competitor

Table 99: Relative share of 30-44 year old motor insurance customers, by income

Table 100: Relative share of 30-44 year old household insurance customers, by competitor

Table 101: Relative share of 30-44 year old household insurance customers, by income

Table 102: Relative likelihood of switching by 30-44 year olds, motor insurance

Table 104: Relative levels of attrition of 30-44 year olds by motor insurance competitor

Table 105: Relative levels of attrition of 30-44 year olds by household insurance competitor

Table 106: Relative likelihood among 30-44 year olds of shopping around for motor insurance quotations at next renewal

Table 107: Relative likelihood among 30-44 year olds of shopping around for household insurance quotations

List of Figures

Figure 1: Over 60% of all 30-44 year olds have building, contents or motor insurance

Figure 2: Direct Line leaves competitors in its wake for spontaneous awareness among 30-44 year olds

Figure 3: Household insurance consumers rank cheap quotes as most important factor

Figure 4: 30-44 year olds demonstrate relative propensity to switch motor insurer

Figure 5: The household market outperformed other personal insurance products in 2002

Figure 6: 30-44 year old age group accounts for 22.6% of total population

Figure 7: Household expenditure greatest for 30-49 year olds

Figure 8: General insurance weekly expenditure peaks in 30-49 age group

Figure 9: Vehicle registrations continue on upward trend

Figure 10: Growth in one-car ownership responsible for the increase in vehicle registrations

Figure 11: 30-49 year olds are more likely to hold a UK driving license than any other age group

Figure 12: Male driving license holders outnumber females in every age group

Figure 13: Growth of one and two person occupancies has driven growth in total number of households

Figure 14: 30-44 year olds tend to own homes with mortgages

Figure 15: Private medical policyholders are drifting away

Figure 16: Retirement heralds increase in medical insurance spending

Figure 17: 30-59 year olds are the prime insurance group

Figure 18: 30-44 year olds are most likely to have motor insurance

Figure 19: Over 60% of all 30-44 year olds have building, contents or motor insurance

Figure 20: Most 30-44 year olds tend not to have any medical insurance

Figure 21: 30-44s particularly likely to have income replacement and critical illness cover

Figure 22: A higher proportion of 50-64 year olds than consumers of other ages have medical insurance

Figure 23: Amongst 30-44 year olds, the £40,000-£49,999 income band has highest likelihood of being covered by household and motor insurance

Figure 24: Higher earners are more likely to have medical insurance

Figure 25: Single 30-44 year olds are least likely to have insurance policies

Figure 26: Married 30-44 year old consumers are most likely to have some form of private medical cover

Figure 27: Mortgage holders most likely to own insurance policies

Figure 28: 30-44 years are most likely to consult directories to select a motor insurance provider

Figure 29: Frequency of Internet usage for motor insurance selection wanes with increasing age

Figure 30: Mailshots and television have equal influence in all income bands in motor insurance

Figure 31: Household insurance customers are most likely to have previously dealt with an insurer

Figure 32: 30-44 year olds shy away from newspapers but value TV in household insurance considerations

Figure 33: Brokers and the Internet are sources favored by higher earners in household insurance

Figure 34: More Th>n and Zurich FS vastly increased their motor insurance advertising budgets in 2002

Figure 35: AA spent more on press advertising than any other motor insurer in 2002

Figure 36: AA spent over twice as much as its nearest competitor on radio advertising

Figure 37: Five motor insurers accounted for 85.6% of television advertising spend in 2002

Figure 38: Almost all motor insurers spent money on direct mail

Figure 39: Zurich and CIS upped their 2002 insurance advertising budgets

Figure 40: Direct Line leads the field for press advertising

Figure 41: Direct Line and More Th>n dominate television advertising market

Figure 42: Lloyds TSB spent heavily on direct mail advertising in 2002

Figure 43: Health insurers spent more on advertising in 2001 than 2002

Figure 44: Most accident and health insurers allocate part of their budgets to press advertising

Figure 45: BUPA was the only accident and health insurer to dedicate any significant resources to radio advertising

Figure 46: BUPA’s television campaign leaves other accident and health insurers in its wake

Figure 47: Norwich Union leads the direct mail advertising field

Figure 48: Direct mail and TV are the main advertising media across all insurance products

Figure 49: 30-44 year old consumers are most aware of advertising by providers with largest budgets

Figure 50: Swinton is more likely to have awareness of its advertising among 30-44 year olds than any other age group

Figure 51: AA’s relative recognition is driven by income

Figure 52: General insurance advertising awareness becomes more varied with income

Figure 53: AA and RAC record comparable advertising awareness levels across income bands

Figure 54: Churchill advertising is recognized most by all except married 30-44 year old consumers

Figure 55: Direct Line leaves competitors in its wake for spontaneous awareness among 30-44 year olds

Figure 56: Esure has highest spontaneous awareness among 30-44 year olds compared with other age groups

Figure 57: Direct Line is the most recognized direct motor insurance provider

Figure 58: 30-44 year olds have above average likelihood of recalling all featured motor providers

Figure 59: All income bands recall Direct Line first in motor insurance

Figure 60: 30-44 year olds with higher incomes have better recognition of certain motor insurance providers

Figure 61: Direct Line has highest awareness across all marital statuses

Figure 62: Biggest players have highest household insurance recognition

Figure 63: 30-44 year olds have above average awareness of all direct household insurance providers

Figure 64: Household insurance provider recognition is consistent across income bands

Figure 65: Household insurance awareness is weakest among lowest earning 30-44 year olds

Figure 66: Marital status has no effect on Direct Line’s position at forefront of awareness of direct household insurers

Figure 67: Price is overwhelmingly the most important factor for 30-44 year olds purchasing motor insurance

Figure 68: All income bands seek value for money in motor insurance quotes

Figure 69: Household consumers rank cheap quotes as most important factor

Figure 70: Mortgage considerations feature in 30-44 year olds’ household insurance thinking

Figure 71: Direct approach still favored in motor insurance

Figure 72: 30-44 year olds value personal contact less than older consumers

Figure 73: Direct approach comparable across all income bands, but use of employer increases with earnings

Figure 74: Telephone is most used platform by 30-44 year olds for motor insurance arrangement

Figure 75: Internet and post distribution show opposing trends

Figure 76: Likelihood of face-to-face contact declines with income

Figure 77: Direct arrangement prevalent among 30-44 year old household insurance customers

Figure 78: Insurance arrangement at time of mortgage more likely for 30-44 year olds than any other age group

Figure 79: Likelihood of direct contact with household insurer increases with income

Figure 80: 30-44 year olds rely on telephone for arranging household insurance

Figure 81: Propensity to use Internet for household insurance purchase plummets with age

Figure 82: Internet usage most likely in upper income bands

Figure 83: Direct Line is the most popular motor insurance provider among 30-44 year olds

Figure 84: Direct Line owns most 30-44 year olds in every income band

Figure 85: Admiral and Cornhill more likely to insure wealthiest consumers

Figure 86: 30-44 year olds most likely to have a household insurance policy with Lloyds TSB

Figure 87: Lloyds TSB is most popular household insurance provider among lower income customers

Figure 88: Household insurers’ customers evenly distributed across income bands

Figure 89: Motor insurance customers twice as likely to have switched as household insurance customers aged 30-44

Figure 90: Motor insurance consumer loyalty increases with age

Figure 91: Middle income earners tend to switch insurers more frequently

Figure 92: 30-44 year olds are five times more likely to stay with existing household insurance provider than change

Figure 93: 30-44 year olds are the most likely age group to have switched household insurance provider

Figure 94: Highest earners have the highest propensity to change provider in household insurance

Figure 95: 30-44 year old customer attrition in motor insurance highest at Norwich Union

Figure 96: Largest household insurers suffer greatest churn

Figure 97: Motor insurance customers have high likelihood of looking around for alternative quotes at next renewal

Figure 98: 30-44 year olds demonstrate propensity to switch motor insurer

Figure 99: Likelihood of seeking new motor insurance quote spread evenly across all income bands

Figure 100: Marital status has minimal effect on likelihood of switching motor insurance quote

Figure 101: 30-44 year olds are as likely to look for alternative household insurance quotes as to remain with the same provider without checking

Figure 102: 30-44 year olds have highest likelihood of shopping around for household insurance quotations

Figure 103: Likelihood of household insurance switching grows with income

Figure 104: Single, divorced and separated consumers more likely not to look for a new household quote

Figure 105: Churchill has most volatile motor insurance customers

Figure 106: Direct Line most likely to have fickle 30-44 year old customers

Figure 107: 30-44 year old motor insurance consumers look around

Figure 108: 30-44 year olds tend to collect numerous household quotes

Figure 109: AA and CIS have highest motor insurance loyalty levels among 30-44 year olds

Figure 110: Halifax customers most likely to obtain no insurance quotes

Figure 111: Indifference is a common theme among 30-44 year old motor insurance consumers

Figure 112: Household insurance customers are not easily pleased

Abstract

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