In terms of deciding whether to change personal-lines insurersand which new carrier to choose, price remains the primary—but notonly—factor considered by auto and homeowners' consumers.

Indeed, when asked about their decision points when placing autoinsurance for the Deloitte Research ”Voice of the Personal LinesInsurance Consumer” surveys, more than two-thirds of the 1,080respondents said price was either extremely (54 percent) or very(28 percent) influential the last time they changed carriers. Thenumbers were similar among the 1,080 homeowners surveyed, althougha lower share (45 percent) cited cost as extremely influential,along with 30 percent who said the price was very influential.

Interestingly, among the four age segments surveyed, those 26-34recorded the largest percentage (71 percent) of those ranking theprice of auto coverage as extremely influential but also the lowestpercentage (31 percent) among homeowner respondents ranking priceas important. This could perhaps be explained by the factthat having the right coverage for a home—most likely a youngconsumer's biggest investment—is simply a more importantconsideration than price.

Another intriguing point is that while respondents cited pricein retrospect as the most influential factor in their decision tochange personal-lines carriers, when asked prospectively what wouldinfluence them, price did not rank nearly as high. Among autorespondents, 58 percent said price would be either extremely (27percent) or very (31 percent) influential when they next shop for anew policy, compared to about one-third each among homeowners.

Many consumers surveyed indicated they would respond favorablyto multipolicy-discount offers. Looking back, four in 10 autorespondents cited the availability of an auto/homeowners' insurancemultipolicy discount as extremely (17 percent) or very (21 percent)influential in their last decision to change carriers. Amonghomeowners surveyed, the influence of multipolicy discounts waseven stronger, with 58 percent citing this factor as extremely (28percent) or very (30 percent) influential the last time theychanged carriers.

Many auto respondents noted that the availability oftelematics—technology to monitor driving experience in return for apotential break on the price of coverage—might prompt them tochange carriers. Indeed, 3 in 10 said getting a discount forinstalling such a device would be extremely (12 percent) or very(17 percent) influential in their next purchase decision.

However, about 30 percent said they would not agree to installsuch a device, while another 30 percent said they would. But about40 percent said their answer would depend on the premium discountbeing offered. Nearly half of those on the fence said they wouldexpect more than a 20 percent discount to make such electronicmonitoring worth their while, while another 22 percent would want aprice break of 16-20 percent. About 1 in 5 would install thedevice for a potential discount of 11-15 percent. Only 1 in 10would go along for a 6-10 percent discount, and only a handful (2percent) would agree for less than 6 percent in savings. Age is afactor here as well, with the two older segments surveyed morelikely to agree to have a monitoring device installed, whileyounger respondents were more leery of the idea.

The amount and type of coverage offered wasthe second most important decision point among respondents the lasttime they changed carriers, but not nearly as strong aconsideration as price, with only 31 percent of auto respondentsciting coverage as extremely influential (compared to 54 percent onprice). The same pattern held for homeowners (24 percent oncoverage versus 45 percent on price).

Reputation and trust were also key factors. Three out of fourauto respondents said brand name, reputation for financial strengthand the insurer's rating were important, including 1 in 5 whoconsidered these elements extremely influential when they lastchanged carriers. The numbers were similar for homeowners.

Brand-name recognition was a very important decision point amongboth auto and homeowner respondents. About 3 in 4 bought through anexclusive agent because they represented a widely known insurer,two-thirds bought direct because they prefer to do business with awidely known insurer, and about half would be more willing to buydirect if the insurer had a widely known brand.

The importance of brand recognition and perceptions of integrityspotlight the need for more proactive reputational risk-managementefforts by insurers in general and the industry as a whole.

One particular area impacting brand reputation is claim service,which was a significant decision point among both samples queried,with about 1 in 3 respondents indicating that poor claims handlingwas extremely or very influential in their last decision to changecarriers.

In terms of which individuals influence personal-lines buyers intheir purchase decisions, respondents indicated they were swayedmore by recommendations from family, friends and colleagues thanfrom an agent. However, once again age plays a big part, as youngerbuyers indicated they were much more heavily influenced by theirfamily and acquaintances.

A significant percentage (41 percent) indicated that anaffiliation between their bank and their auto insurer would beextremely (18 percent) or very (23 percent) influential in theirdecision whether to buy coverage. The numbers were similar amonghomeowner respondents. However, an affiliation with therespondent's employer did not score nearly as high.

There was a split when it came to the influence of anendorsement from a group or association to which the respondentbelongs. This was cited as a major factor among auto-insurancebuyers, with half of the respondents noting this as eitherextremely (17 percent) or very (33 percent) influential. Amonghomeowners, however, this factor was cited by fewer than half thatnumber—20 percent overall, and only by 8 percent as extremelyinfluential.

About 1 in 4 among both samples said arecommendation from their auto dealer or real estate agent would beinfluential in their insurance-purchase decision, including about 1in 10 who said these referrals would be extremely influential.

Interestingly, while about 1 in 5 said advertising was eitherextremely (9 percent) or very (14 percent) influential in decidingwhere to buy auto insurance, more than half said ads were not veryinfluential (17 percent) or not at all influential (35 percent).The numbers were similar among homeowner respondents.

When asked what would be their three most preferred ways to shopfor a new auto policy, “checking a website offering quotes frommultiple carriers” scored the biggest response, cited by 41 percentof those surveyed, including 15 percent who said this would betheir most preferred channel (respondents could choose multipleoptions, in order of preference). Next came an independent agentrepresenting multiple insurers at 36 percent (also including 15percent as most preferred), followed by agents selling exclusivelyfor one carrier at 31 percent (although this option drew thelargest percentage of the top preferred choice at 17 percent).

Among homeowner respondents, about 40 percent chose eitherindependent or exclusive agents among their Top 3, with 1 in 5citing either one as their first choice. Checking a websiteoffering quotes from multiple carriers made the Top 3 among 1 in 3respondents but was cited as the first choice by only 13percent.

These responses indicate that while price is a critical elementfor personal-lines buyers, there are other factors they considerwhen choosing a carrier, offering insurers a variety of decisionpoints they can leverage to differentiate themselves and therebyretain more customers and boost new business.

In my next blog, I'll explore where insurers might go from here,based on all the survey findings I've presented in these blogs thusfar.

(We welcome your feedback and questions throughout this seriesof reports. You may download the full report on “The Voice of thePersonal Lines Insurance Consumer” from Deloitte Research athttp://www.deloitte.com/view/en_US/us/Industries/Insurance-Financial-Services/a0f93dffd16f5310VgnVCM2000001b56f00aRCRD.htm.)