May 03, 2017 – from Investor Insights

How Millennials Are Steering the Future of Auto Insurance

Two drivers exchange informationAuto insurance is about to get more expensive: Property and casualty (P&C) insurers plan on raising premiums nationwide this year. The hikes will offset the growing cost of accidents triggered largely by increased domestic travel. P&C firms are also attempting to grow their customer base with “usage-based insurance” (UBI), which promises discounts to safe drivers. But obstacles remain. Older generations, particularly Boomers, are hesitant to sign up for services that watch and record their every move. Even if UBI wins over Millennials, self-driving cars may eventually upend the existing P&C insurance framework.

The U.S. property and casualty insurance sector comprises a mix of publicly held companies, mutual firms, and subsidiaries. Leading in written premiums is State Farm ($59.4 billion). Second is publicly traded Allstate ($30.2 billion), followed by Berkshire Hathaway subsidiary GEICO ($30.0 billion). Liberty Mutual ($29.8 billion) comes next, followed by Travelers ($23.2 billion), a public firm that earns most of its revenue from commercial P&C sales. These…

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