Auto insurance revenues grew 6.2% industry-wide last year, topping off at a healthy $245 billion thanks to a combination of strong premium growth and increased auto sales volume.
Even more impressive, 54% of those gains – $7.8 billion in direct written premiums – were captured by just two carriers: Progressive and GEICO. More broadly, the total share of premium among the top 10 largest insurance companies was 72.5%, signaling the growing dominance of a small number of large insurers in the auto market.
What’s driving this trend? In a word: consumerism. The shift in consumer behavior in the auto insurance industry is quickly moving from face-to-face to digital as large, well-capitalized insurers give consumers the tools to shop as they would for any other consumer product. Increasingly, those insurers who get that consumer model right are the ones who will dominate the market.