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Targeting 30-44 year old Consumers in UK Motor Insurance 2003Published by: Datamonitor Published: Aug. 7, 2003 - 164 Pages Table of ContentsTABLE OF CONTENTS CHAPTER 1 EXECUTIVE SUMMARY 3 Insurance Consumers 3 Consumer Awareness 4 Consumer Purchasing Behavior 6 Customer Retention and Attrition 7 CHAPTER 2 INTRODUCTION 27 What is this report about? 27 A note on indexing 29 Who is the target reader? 29 How to use this report 29 CHAPTER 3 INSURANCE CONSUMERS 31 Introduction 31 Key findings 31 Insurance market context 32 Private motor drives personal insurance GWP 32 30-44 year olds in context 33 30-44 year old age group accounts for 22.6% of total population 33 30-49 year olds spend more on insurance products than any other age group 35 Motor insurance consumers in context 38 Vehicle registrations approach 30 million 38 Number of no-car households is falling steadily 40 30-49 year olds are most likely to hold a UK driving license 42 General insurance cover 46 Motor insurance is the most commonly held insurance type among 30-44 year olds 46 Key target for insurers is the £40,000-£49,999 income band 51 Married consumers have a greater tendency to be insured 53 Home ownership has a positive impact on likelihood of insurance ownership 55 CHAPTER 4 CONSUMER AWARENESS 57 Introduction 57 Key findings 57 Sources of information used to find an insurer 58 Directories and previous dealings remain popular in motor insurance 58 Advertising spend by competitor 63 Motor insurance advertising boomed in 2002 63 Advertising awareness among 30-44 year olds 77 30-44 year olds are most aware of advertising by Churchill and Direct Line 77 Consumer brand awareness 91 Direct Line is the first name on 30-44 year old consumers’ lips 91 Direct Line zooms ahead in motor insurance recognition 96 CHAPTER 5 CONSUMER PURCHASING BEHAVIOR 108 Introduction 108 Key findings 108 Selection criteria 108 Pricing is the driving factor for 30-44 year olds in choosing motor insurance 109 Distribution channels and platforms used by 30-44 year old consumers 112 Motor insurance customers tend to contact providers direct 112 Competitor shares of 30-44 year old consumers 122 Direct Line accelerates ahead of motor competitors 122 CHAPTER 6 CUSTOMER RETENTION AND ATTRITION 129 Introduction 129 Key findings 129 Customer switching among 30-44 year olds 129 30-44 year olds are most fickle motor insurance customers 130 Attrition by competitor 133 Churn highest among most established motor providers 133 Likelihood of shopping for alternative quotes amongst 30-44 year olds 134 Motor insurance consumers are likely to look around 134 Likelihood of competitors’ policyholders shopping around 140 Churchill’s customers most likely to shop around for motor insurance 140 Number of quotes obtained by 30-44 year olds 143 Motor insurance consumers tend to compare many quotes 143 Number of alternative quotes, by competitor 145 AA and CIS are best positioned to minimise shopping around in motor insurance 145 Customer satisfaction among 30-44 year olds 147 Indifference prevails among 30-44 year old motor insurance customers 147 CHAPTER 7 SUMMARY 149 30-44 year old consumer profile matrix 150 Key observations 151 CHAPTER 8 APPENDIX 152 Research methodology 152 MFS Financial Services (MFS) methodology and contacts 152 MFS survey data 154 Insurance Consumers 154 Consumer Awareness 155 Consumer Purchasing Behavior 163 Consumer Retention and Attrition 166 Definitions 167 Bibliography 167 Future readings 168 Do you need more information? 168 Datamonitor Financial Services Consulting 168 SPP writing team 170 LIST OF TABLES Table 1: Private insurance GWP in UK, 1997-2002e 30 Table 2: Age structure of UK population, 2001 31 Table 3: Household expenditure by age of head of household, UK 2001 33 Table 4: Vehicle registrations in UK, 1991-2001 36 Table 5: Households owning cars in UK, 1990-2001 38 Table 6: Full driving license holders in UK by age, 1975-2001 40 Table 7: Full driving license holders in UK by age and sex, 1975-2001 42 Table 8: Insurance cover by age group and type 45 Table 9: Household and motor insurance expenditure by age of head of household, 2001/2 47 Table 10: Insurance cover among 30-44 year olds, by income 50 Table 11: Insurance ownership among 30-44 year olds, by marital status 51 Table 12: Insurance ownership among 30-44 year olds, by household tenure 53 Table 13: Sources of information used to find a motor insurer, by age 58 Table 14: Sources of information used by 30-44 year olds to find a motor insurer, by income 60 Table 15: Advertising expenditure by motor insurers, by medium, 2002 62 Table 16: Change in advertising expenditure by motor insurer, 2001-2 66 Table 17: Prompted awareness of general insurance advertising by 30-44 year olds 79 Table 18: Prompted awareness among 30-44 year olds of general insurance advertising, by income 82 Table 19: Prompted awareness of general insurance advertising among 30-44 year olds, by marital status 87 Table 20: Unprompted awareness of general insurers among 30-44 year olds 92 Table 21: Prompted awareness among 30-44 year olds of direct motor insurance providers 97 Table 22: Prompted awareness among 30-44 year olds of direct motor insurance providers, by income 101 Table 23: Prompted awareness among 30-44 year olds of direct motor insurance providers, by marital status 104 Table 24: Motor insurance distribution via channel, by age group 112 Table 25: Motor insurance distribution via channel among 30-44 year olds, by income 114 Table 26: Motor insurance distribution via platform, by age group 117 Table 27: Motor insurance distribution via platform among 30-44 year olds, by income 119 Table 28: Proportion of motor insurance customers aged 30-44, by competitor 121 Table 29: Indexed share of 30-44 year old motor insurance customers, by income 125 Table 30: Incidence of customer switching, motor insurance by age group 128 Table 31: Incidence of 30-44 year old customer switching in motor insurance, by income 130 Table 32: Likelihood of shopping around for motor insurance quotations, by age group 133 Table 33: Likelihood among 30-44 year olds of shopping around for motor insurance quotations, by income 135 Table 34: Likelihood among 30-44 year olds of shopping around for motor insurance quotations, by marital status 137 Table 35: Likelihood of shopping around for motor insurance quotations, by competitor 139 Table 36: Number of quotes obtained by 30-44 year old motor insurance customers 141 Table 37: Number of alternative motor insurance quotes obtained by 30-44 year olds, by competitor 144 Table 38: 30-44 year old customer satisfaction, motor insurance 145 Table 39: 30-44 year old consumer profile matrix 147 Table 40: Relative likelihood of general insurance ownership among 30-44 year olds 151 Table 41: Sources of information used by 30-44 year olds to find a general insurer 152 Table 42: Relative likelihood of 30-44 year olds choosing a source for motor insurance 153 Table 43: Relative awareness of general insurers’ advertising campaigns by 30-44 year olds 154 Table 44: Relative awareness of general insurance advertising among 30-44 year olds, major competitors by income band 154 Table 45: Relative awareness of general insurance advertising among 30-44 year olds, major competitors by marital status 155 Table 46: Relative unprompted awareness of general insurers among 30-44 year olds 156 Table 47: Unprompted awareness among 30-44 year olds of general insurers, by income 157 Table 48: Unprompted awareness among 30-44 year olds of general insurers, by marital status 158 Table 49: Relative prompted awareness among 30-44 year olds of direct motor insurers 159 Table 50: Relative awareness of direct motor insurance providers among 30-44 year olds, major competitors by income band 159 Table 51: Relative awareness of direct motor insurance providers among 30-44 year olds, major competitors by marital status 160 Table 52: Selection criteria for choosing a motor insurance provider by age, relative shares 160 Table 53: Selection criteria for choosing a motor insurance provider by income, relative shares 161 Table 54: Motor insurance distribution channels among 30-44 year olds, relative share 161 Table 55: Motor insurance distribution platforms among 30-44 year olds, relative share 162 Table 56: Relative share of 30-44 year old motor insurance customers, by competitor 162 Table 57: Relative share of 30-44 year old motor insurance customers, by income 162 Table 58: Relative likelihood of switching by 30-44 year olds, motor insurance 163 Table 59: Relative levels of attrition of 30-44 year olds by motor insurance competitor 163 Table 60: Relative likelihood among 30-44 year olds of shopping around for motor insurance quotations at next renewal 163 LIST OF FIGURES Figure 1: Over 60% of all 30-44 year olds have building, contents or motor insurance 3 Figure 2: Direct Line leaves competitors in its wake for spontaneous awareness among 30-44 year olds 5 Figure 3: Price is overwhelmingly the most important factor for 30-44 year olds purchasing motor insurance 6 Figure 4: 30-44 year olds demonstrate relative propensity to switch motor insurer 7 Figure 5: The household market outperformed other personal insurance products in 2002 26 Figure 6: 30-44 year old age group accounts for 22.6% of total population 28 Figure 7: Household expenditure greatest for 30-49 year olds 29 Figure 8: General insurance weekly expenditure peaks in 30-49 age group 31 Figure 9: Vehicle registrations continue on upward trend 32 Figure 10: Growth in one-car ownership responsible for the increase in vehicle registrations 34 Figure 11: 30-49 year olds are more likely to hold a UK driving license than any other age group 36 Figure 12: Male driving license holders outnumber females in every age group 38 Figure 13: 30-59 year olds are the prime insurance group 41 Figure 14: 30-44 year olds are most likely to have motor insurance 43 Figure 15: Over 60% of all 30-44 year olds have building, contents or motor insurance 44 Figure 16: Amongst 30-44 year olds, the £40,000-£49,999 income band has highest likelihood of being covered by household and motor insurance 46 Figure 17: Single 30-44 year olds are least likely to have insurance policies 48 Figure 18: Mortgage holders most likely to own insurance policies 50 Figure 19: 30-44 years are most likely to consult directories to select a motor insurance provider 53 Figure 20: Frequency of Internet usage for motor insurance selection wanes with increasing age 54 Figure 21: Mailshots and television have equal influence in all income bands in motor insurance 56 Figure 22: More Th>n and Zurich FS vastly increased their motor insurance advertising budgets in 2002 62 Figure 23: AA spent more on press advertising than any other motor insurer in 2002 65 Figure 24: AA spent over twice as much as its nearest competitor on radio advertising 66 Figure 25: Five motor insurers accounted for 85.6% of television advertising spend in 2002 68 Figure 26: Almost all motor insurers spent money on direct mail 70 Figure 27: 30-44 year old consumers are most aware of advertising by providers with largest budgets 73 Figure 28: Swinton is more likely to have awareness of its advertising among 30-44 year olds than any other age group 75 Figure 29: AA’s relative recognition is driven by income 77 Figure 30: General insurance advertising awareness becomes more varied with income 78 Figure 31: AA and RAC record comparable advertising awareness levels across income bands 81 Figure 32: Churchill advertising is recognized most by all except married 30-44 year old consumers 82 Figure 33: Direct Line leaves competitors in its wake for spontaneous awareness among 30-44 year olds 86 Figure 34: Esure has highest spontaneous awareness among 30-44 year olds compared with other age groups 88 Figure 35: Direct Line is the most recognized direct motor insurance provider 91 Figure 36: 30-44 year olds have above average likelihood of recalling all featured motor providers 93 Figure 37: All income bands recall Direct Line first in motor insurance 95 Figure 38: 30-44 year olds with higher incomes have better recognition of certain motor insurance providers 97 Figure 39: Direct Line has highest awareness across all marital statuses 99 Figure 40: Price is overwhelmingly the most important factor for 30-44 year olds purchasing motor insurance 104 Figure 41: All income bands seek value for money in motor insurance quotes 106 Figure 42: Direct approach still favored in motor insurance 107 Figure 43: 30-44 year olds value personal contact less than older consumers 108 Figure 44: Direct approach comparable across all income bands, but use of employer increases with earnings 110 Figure 45: Telephone is most used platform by 30-44 year olds for motor insurance arrangement 112 Figure 46: Internet and post distribution show opposing trends 113 Figure 47: Likelihood of face-to-face contact declines with income 115 Figure 48: Direct Line is the most popular motor insurance provider among 30-44 year olds 117 Figure 49: Direct Line owns most 30-44 year olds in every income band 119 Figure 50: Admiral and Cornhill more likely to insure wealthiest consumers 121 Figure 51: Motor insurance customers twice as likely to have switched as household insurance customers aged 30-44 124 Figure 52: Motor insurance consumer loyalty increases with age 125 Figure 53: Middle income earners tend to switch insurers more frequently 126 Figure 54: 30-44 year old customer attrition in motor insurance highest at Norwich Union 128 Figure 55: Motor insurance customers have high likelihood of looking around for alternative quotes at next renewal 129 Figure 56: 30-44 year olds demonstrate propensity to switch motor insurer 130 Figure 57: Likelihood of seeking new motor insurance quote spread evenly across all income bands 131 Figure 58: Marital status has minimal effect on likelihood of switching motor insurance quote 133 Figure 59: Churchill has most volatile motor insurance customers 135 Figure 60: 30-44 year old motor insurance consumers look around 138 Figure 61: AA and CIS have highest motor insurance loyalty levels among 30-44 year olds 140 Figure 62: Indifference is a common theme among 30-44 year old motor insurance consumers 142 AbstractIntroduction30-44 year olds are a prime target for insurers as they are one of the most risk-averse and profitable consumer segments. It is the age segment that spends the most on general insurance products but is also the most fickle in terms of attrition rates. The report examines issues such as attracting and retaining these customers, and their purchasing habits and influences. Scope * Analyses MORI data on preferences and behavioral trends among 30-44 year old consumers in motor insurance * Provides a unique insight into the activities of 30-44 year olds, enabling insurance providers to more effectively target this age group * Benchmarks competitors against one another to show consumer awareness of brand and advertising campaigns and retention and attrition levels * Outlines characteristics of the 30-44 year old consumer segment that differentiate it from other age groups in UK motor insurance Report Highlights 30-44 year olds spend more on general insurance premiums than any other age group, making them a prime target for insurance providers. 30-44 year olds had the highest advertising awareness of Churchill and Direct Line, which also recorded the highest spontaneous recognition among this age group. 30-44 year olds are the most likely age group to change motor insurance provider at next renewal. However, they are still more likely to remain with their current insurer than change. Reasons to Purchase * This report will provide readers with a thorough understanding of this tricky but lucrative consumer segment. * Datamonitor's comprehensive examination of behavioural habits within insurance puts the reader one step ahead when targeting this consumer segment. * Benchmarking of the leading players in motor insurance allows for strategic analysis of insurers' performance within 30-44 year olds. Get Full Details About This Report >> |
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