In recent years, insurance customers have been accustomed to sticking with their current insurance providers without much consideration for alternatives. However, the landscape is changing as double-digit premium increases force policyholders to seek better deals. The exponential rise in prices has created a new trend of shopping around for insurance options.

According to inflation figures, the average car insurance premium surged by over 22% in the past year. Similarly, homeowners' premiums are also witnessing double-digit hikes, not just in disaster-prone areas like Florida and California, but nationwide. Andy Palen, a resident of Milwaukee suburb, recently experienced a $500 annual increase in his homeowners insurance premium, despite having no claims. This surprising jump prompted Palen to reassess his options not only for homeowners' insurance but also for his auto insurance, which he had held with the same carrier for over a decade.

Like many others in a similar situation, Palen turned to the internet to research alternative insurance providers. With the assistance of a local insurance broker, he discovered the potential for substantial savings by switching companies, amounting to several hundred dollars annually. This experience resonates with other customers who are now actively searching for better deals, shaking up the traditionally calm insurance market.

Insurance broker Kate Ferri Dawson from Murrysville, Pennsylvania, confirms an unprecedented increase in insurance shopping activity. Customers are now motivated to explore new options due to significant price changes in recent years. Insurance companies attribute these premium increases to rising repair costs and the escalated damages caused by climate change-induced storms. However, many customers are no longer willing to accept these hikes passively.

There is evidence of increased shopping in the insurance market. LexisNexis Risk Solutions, a clearinghouse for the insurance industry, reports that 42% of auto insurance customers and a similar number of homeowners insurance customers have shopped around in the past year, reaching a record high. Chris Rice, Vice President at LexisNexis Risk Solutions, notes even the most loyal customers are now actively seeking better alternatives due to affordability concerns.

While overall premiums are rising, there is significant variation among different insurance carriers. Doug Heller from the Consumer Federation of America emphasizes that pricing discrepancies can be substantial, with one company sometimes charging twice as much as another for the same coverage. Additionally, the cheapest provider can differ from one location to another. Despite attempts by insurance companies to differentiate themselves through marketing, the coverage itself remains fairly consistent across the industry.

Shoppers are encouraged to thoroughly compare coverage levels and deductibles. However, once those are established, the focus should be on price. Heller advises customers to take advantage of the opportunity to save money by thoroughly researching and shopping around for the best options that meet their needs. This approach not only helps customers identify potential savings but also serves as a reminder to insurance companies that they must provide competitive pricing to retain their policyholders.

Ultimately, the rising costs of insurance have prompted a shift in customer behavior. With increasing frequency, policyholders are now seeking better deals and actively exploring alternative options. The changing landscape of insurance shopping has created an opportunity for customers to find significant savings and ensure that insurance providers remain competitive in a market that is becoming more informed and price-conscious.