JD Power Report: Trends in Auto and Home Insurance Shopping
According to the JD Power Loyalty Indicator & Shopping Trends report, developed with TransUnion, auto insurance shopping saw a decline in the second quarter of 2026, although the rate of policyholders switching providers increased. The study highlights affordability as the primary factor influencing consumers’ decisions to remain with or move away from their current insurers.
The report indicates that the auto insurance shopping rate dropped to 12.6% in the second quarter, a decrease of 1.0 point from the first quarter, and 0.4 points compared to the previous year. However, the switching rate among policyholders increased to 4.5%, marking a rise of 0.3 points both quarter over quarter and year over year. The median premium among those who switched carriers exceeded $3,200, emphasizing the significance of financial considerations in switching decisions. Monthly data revealed fluctuations, with shopping activity cooling in April, peaking in May, and subsiding again in June. The trend for switching mirrored this movement, also peaking in May.
In the homeowners insurance sector, shopping activity increased by 0.6 points from the previous year to 7.1%, although it decreased by 0.3 points from the first quarter. Switching rates rose by 0.3 points quarter over quarter to 2.5%. Renters insurance shopping increased by 0.4 points year-over-year to 6.3% but experienced a slight dip from the first quarter. The switching rate for renters decreased by 0.8 points year over year to 3.4%, despite a 0.4-point rise from the prior quarter.
State Farm led in both home and renters insurance for new business, leveraging bundling strategies. Regional farm bureau insurers, along with Erie and USAA, recorded the highest customer loyalty in auto insurance. Meanwhile, Direct Auto, Root, Alfa, The General, and National General experienced the highest rates of customer defection. In the homeowners insurance segment, NJM and Universal P&C joined farm bureau insurers as leaders, while Alfa, National General, Grange, Nationwide, and Liberty Mutual faced greater customer turnover.
JD Power described a market transition from a surge driven by price shopping to one emphasizing affordability and retention. Although shopping continues at high levels across both auto and property lines, the pace of growth appears to be stabilizing, with consumer behaviors converging across different credit tiers, suggesting a potential reduction in the intensity of shopping activity.
The study distinguishes between financially resilient consumers who continue searching for better value and those who are financially constrained, particularly younger drivers, who may opt to reduce coverage or let policies lapse. This shift suggests that the market's challenge is evolving from a price-centric switching issue to a broader focus on affordability and sustaining coverage.
Consistent with this pattern, LexisNexis Risk Solutions reported that overall auto insurance shopping growth had cooled from "hot" to "warm," with the non-standard auto segment, often most affected by affordability concerns, showing negative growth for the first time since late 2023. These findings underscore the growing trend of drivers exiting the insured market rather than switching carriers, potentially impacting uninsured motorist rates and residual market volumes.
The JD Power report also previewed insights from its AI Insurance Experience Study, set for release in August 2026. It showed that among consumers researching insurance products with AI, 34% used an insurer’s tools, 33% relied on third-party AI, and 14% engaged with AI agents through call centers, while 32% did not use AI tools. Use of AI guidance varied; 19% followed AI advice completely, 49% followed some suggestions, 26% considered but chose differently, and 6% did not trust nor used it.
The report arrives as U.S. regulators intensify focus on AI applications in insurance. By mid-2026, the NAIC's Model Bulletin on AI systems had been adopted by approximately 25 states and the District of Columbia, with states like California, Colorado, New York, and Texas developing their own regulatory frameworks.