State Farm Loses #1 Spot as the Nation’s Largest Auto Insurer
Progressive has been hot on State Farm’s heels and for the last couple of years analysts have been predicting that State Farm would lose its crown as the nation’s top auto insurer.
It has finally happened.
GlobalData says Progressive now has a 14% share of the nation’s auto insurance market. State Farm — who had a 15.9% lead in 2017 — now sits at 13.9%.
A lead of 0.1% is slim but it’s a lead nonetheless. GlobalData predicts that the marketshare for Progressive will continue to increase as we move into 2023. And a big reason for the insurer’s rise is its relationship to independent insurance agents.
A successful advertising campaign with Flo and her friends is another reason being sited by GlobalData.
Progressive was also able to expand business by picking up Protective insurance. Doing that helped the company improve direct written premium (DWP) by 14.1% in 2021.
As a contrast, State Farm’s DWP grew just 3.5% in 2021.
GlobalData’s senior insurance analyst, Swarup Kumar Sahoo said Progressive is also more profitable than State Farm. It has a motor vehicle loss ratio of 67% in 2021. State Farm’s was 72.2%.
“Progressive is expected to maintain its leading position in the US motor insurance market, which is expected to grow at a compound annual growth rate (CAGR) of 3.9% during 2021-26,” Sahoo said. “However, profitability of the industry could be a challenge over the next couple of years due to the high inflation, global automobile chip shortage, and an ongoing recession.”
Source link: Insurance Business America — http://bit.ly/3GSrC6p