Finally some positive news to share about car insurance - a topic we know is of interest to a lot of drivers and Car Pro Show listeners. J.D. Power is now calling it a "buyer's market", with auto insurers shifting their focus to acquiring and keeping high-value clients after years of rising rates and record policy shopping .
In its new 2025 U.S. Auto Insurance Study, J.D. Power reports that after years of rising rates, insurers have returned to profitability so they are shifting gears from a focus on raising rates and exiting unprofitable markets to shoring up relationships with their highest-value customers. Researchers says insurers will have the work cut out for them, however, given 38% of auto insurance customers say they're currently not very satisfied.
“Now that insurers are shifting back into growth mode, they really need to focus on cultivating and keeping high-value customers,” said Stephen Crewdson, managing director of insurance business intelligence at J.D. Power. “But among many of those customers, overall satisfaction this year is not particularly high. To shift that perception after the past few years of significant rate increases, insurers need to focus on delivering a tailored, seamless customer experience across all channels.”
Following are some key findings of the 2025 study:
- More than one-third of customers not very satisfied: J.D. Power reports that while overall customer satisfaction with auto insurers declines just 2 points to 644 (on a 1,000-point scale) from a year ago, more than one-third (38%) of customers fall into the bottom segment of customer satisfaction scores. Researchers say this makes them exceedingly less likely to renew their policies with their existing insurer and more likely to shop around for a better deal.
- Highest lifetime value customers at risk: Customers with higher overall lifetime value profiles, who have higher annual premiums, long tenure with their current insurer and multiple policies with that insurer also have the lowest likelihood to renew with their existing insurer. J.D. Power says just 51% of high-value lifetime customers say they “definitely will” renew with their insurer, which is lower than the medium-value lifetime customer (53%) and low-value lifetime customer (54%) segments.
- Price gets customers in the door, but good service keeps them: Good rates and low cost are the top reasons auto insurance customers cite for purchasing from an insurer, but when it comes to renewing an existing policy, good service and positive claims experience are the top drivers of client retention, according to the study.
- Seamless cross-channel interactions drive customer experience: The study found that a seamless experience across channels is the most important driver of overall satisfaction among auto insurance customers. When insurers deliver on this key performance indicator, J.D. Power says customers are significantly more likely to have higher levels of trust in their insurer; feel better about the people they are working with; and feel like it is easy to work with their insurer.
The J.D. Power study measures customer satisfaction with auto insurance in 11 geographic regions. A separate category addresses usage-based insurance (UBI), along with diagnostics that influence UBI participants’ experience with their insurer’s usage-based auto products.
Highest-ranking auto insurers and scores by region
- California: Auto Club of Southern CA (AAA) (676) (for a second consecutive year)
- Central: Shelter (673) (for a fifth consecutive year)
- Florida: Allstate (660) and GEICO (660) in a tie
- Mid-Atlantic: NJM Insurance Co. (721)
- New England: Amica (735) (for a second consecutive year)
- New York: New York Central Mutual (652)
- North Central: Erie Insurance (684) (for a fifth consecutive year)
- Northwest: State Farm (648)
- Southeast: Erie Insurance (718)
- Southwest: CSAA Insurance Group (AAA) (676) (for a second consecutive year)
- Texas: Nationwide (657)
- Usage-Based Insurance (UBI): Nationwide (698) (for a second consecutive year)
About the Study
The U.S. Auto Insurance Study is now in its 26th year. It measures customer satisfaction with auto insurers in key categories, (listed in order of importance): level of trust; price for coverage; people; ease of doing business; product/coverage offerings; problem resolution; and digital channels. This year’s study is based on responses from 48,121 auto insurance customers and was fielded from May 2024 through April 2025. For more information visit J.D. Power.