5 W’s for Profitable Auto Retention: How to Protect the Right Business

By Tim Finnigan, Greg Jacobs, Jim Levendusky, Brad Magick, CPCU

June 23, 2025 / 7 min read

SmilingWomanDrivingCar

Personal auto insurance consumers are shopping at a record pace, and this trend is expected to continue in 2025, according to J.D. Power.¹ Post-pandemic price hikes have led to $140 billion in auto premiums being shopped annually,² increasing the risk of losing existing policyholders.

Adding to the challenge, traditional retention assumptions no longer apply: our research indicates that the 12-month churn rate—the percentage of policyholders switching carriers—has nearly doubled since 2021.³

As insurers took non-rate actions to ease profitability pressures over the past two years, in many cases, they focused on profitability over policies-in-force growth. Now, at the crossroads of a soft market and stiff competition, insurance leaders are keenly aware of the potential to lose profitable business.

“W” No. 5: Why are policyholders leaving, and how can you attract future loyal customers?

5W’s for profitable auto insurance retention

Here are five “W’s” insurers may be asking themselves:

Who in my book is shopping?
What tools and data can simplify the pursuit of profitable retention?
When in the policy life cycle is it best to seek profitable retention?
Where can new data sources make a cost-effective impact on profitable retention?
Why are my policyholders leaving, and how can I attract future loyal customers?

Driving profitable auto retention requires a multifaceted approach. While achieving 100 percent retention may be unrealistic, Verisk is uniquely positioned to help insurers tackle this challenge and retain the most desirable customers.

Here are some key questions, common roadblocks, and innovative strategies that can strengthen loyalty and improve retention outcomes.

“W” No. 1: Who in your book is shopping?

Last year brought a decline in rate increases and, in some instances, rate decreases. This has led to not only a spike in shopping, but also an increase in switching,⁴ and unlike patterns witnessed earlier, policyholders are no longer just “window shopping.”

Roadblock: How do you identify policyholders who are actively shopping?

Innovation: Harness Activate from Verisk Marketing Solutions to acquire new customers and retain and grow existing business.

In-market signals reveal which consumers are shopping, when, how often, and for what. This intelligence enables carriers to efficiently grow their portfolios through targeted and personalized outreach early in the consumer's buying process.

Activate is Verisk Marketing Solutions' platform for marketers to enrich their portfolio of customers and prospects with a proprietary network of behavioral data to identify in-market activity. This data empowers sustainable growth by helping auto insurers identify churn risks, as well as bundling opportunities when consumers are shopping for other insurance products.

“W” No. 2: What tools and data can simplify the pursuit of profitable auto retention?

Retention doesn’t have to be complex. Verisk’s turnkey batch solutions help insurers act fast, with no heavy IT lift required.

Roadblock: Profitable auto retention is a multifaceted challenge. Knowing where to start can be daunting.

Innovation: Start with a batch Auto Book Health Report to obtain analytics that deliver immediate value.

Many of Verisk’s auto retention solutions can help generate immediate value with minimal lift from IT, underwriting, and customer service. Think of it as a health check-up for your book, run once to get insights across thousands of policies. Detect premium leakage such as undisclosed drivers, mileage discrepancies, and garaging issues, to reduce rate subsidization and strengthen rate integrity. All this can help achieve a 22:1 return on investment across the policy life cycle.⁵A small step, such as running a batch on your current book, can uncover big opportunities.

“W” No. 3: When in the policy life cycle is it best to confront profitable retention?

Renewal can be the best opportunity to protect profitability by fine-tuning pricing, reducing premium leakage, and retaining valuable policyholders before they leave.

Roadblock: How do you spot mispriced policies, whether underpriced or overpriced, and take action?

Innovation: Use RISK:check^® Renewal to combine advanced analytics and targeted policyholder outreach for smarter, fairer retention without overburdening your teams.

This turnkey solution can help detect premium leakage, identify underpriced risks, and guide action through personalized outreach, aligning the pricing with actual risk to improve fairness and loyalty. Not all churn is bad. Profitable retention means keeping the right customers at the right price.

RISKCheckRenewalConfrontingPremiumLeakageToOptimizeRetention (1)

And for auto insurers still struggling with profitability, Verisk can assist with non-rate actions at renewal, a fast, effective lever to improve margins without raising rates.

“W” No. 4: Where can new data sources make a cost-effective impact on profitable retention?

Extreme driving behaviors are increasing, yet many carriers have reduced the frequency of renewal motor vehicle report (MVR) orders to every 2 to 3 years or rely on trade-off models that lower MVR costs but risk missing critical violations.

What if there were a better way—one that turns cost containment into a competitive edge?

Sustainable, profitable auto retention requires timely, actionable insights into shifting driving risk. This helps prevent drivers with clean records from subsidizing those with multiple violations, and it can prevent adverse selection. The key is integrating new, intelligent data sources that provide a clearer picture without straining resources.

Roadblock: How can you maintain rate integrity relative to driving risk across your book, yet manage rising MVR fees?

Innovation: Verisk’s Driving History Solutions tap into 2 billion+ public records to help fine-tune accuracy while cutting MVR costs up to 35%.

Access Public Records Intelligence^TM for a comprehensive database of violations, court records, and crash data. This industry-leading violations warehouse can be the key to lower MVR expenses and better retention via better overall rate integrity.

Verisk’s solutions help affordably identify new violations in near-real-time, including:

Unique cost-saving analytics
Renewal MVRs
Details from court records and accident reports about infractions that appear 60-175 days sooner than on an MVR
Ongoing driver monitoring of new violations

In addition to these new data sources and innovations, Verisk has 30+ years of DMV and 15+ years of public records sourcing experience, plus the capability to deliver MVRs in 51 U.S. jurisdictions and four Canadian provinces.

“W” No. 5: Why are policyholders leaving, and how can you attract future loyal customers?

Did you know customers who switched carriers two or more times have loss cost relativities 2.7 times higher than those who did not switch?⁶

As personal auto insurance shopping accelerates, unlocking predictive behavioral insights at Rate Call 1 is a defining trait of industry leaders. Verisk delivers transformative policy history analytics that address the industry's need for increased rating segmentation, optimized quotes, and profitable growth. These analytics can even be applied via batch processing to existing books of business to understand who is more likely to be a retention risk, and to plan personalized offers that may boost retention initiatives.

Roadblock: How can insurers identify predictive policy insights related to retention?

Innovation: Coverage Verifier Analytic Objects (CVAO) are transformative policy history analytics that can unlock past retention behaviors and even help predict future loyal policyholders.

Success in today’s fast-paced shopping market often hinges on superior, sustainable acquisition and retention, but traditional snapshot data of the most recent carrier is losing its edge as a tool to distinguish among customers and outperform the competition.

For decades, insurers have leveraged policy and endorsement change behavior at renewal.

What if you could harness historical policy data up front within seconds to more precisely predict future outcomes, tailor workflows, and help quote and bind policies efficiently?
What if you could micro-segment rates and identify future loyal customers at Rate Call 1?

With Verisk’s Coverage Verifier Analytic Objects (CVAO), dozens of actionable analytic objects derived from up to seven years of deep historical policy data can yield insights into which applicants are likely to represent sustainable, profitable growth in the future, and even which policyholders may be predisposed to leaving.

CaseStudyHowCanYouAttractTraditionallyLoyalCustomersAndDifferentiateLowerCostShoppersFRomHigherCostHoppers

To schedule a profitable auto retention strategy discussion, contact your Verisk account executive or Brad.Magick@verisk.com.

Learn more

1. Quarterly Shopping List Report, U.S. P&C Insurance, J.D. Power Insurance Intelligence, Q4 2024.
2. Auto Policy History Analytics: The Future of Risk Segmentation, Verisk, March 2025, < https://www.verisk.com/resources/campaigns/auto-policy-history-analytics-the-future-of-risk-segmentation/ >, accessed on June 18, 2025
3. Verisk internal data analysis, 2021-2025
4. Quarterly Shopping List Report, U.S. P&C Insurance, J.D. Power Insurance Intelligence, Q4 2024.
5. Verisk client experience
6. Auto Policy History Analytics: The Future of Risk Segmentation, Verisk, March 2025, < https://www.verisk.com/resources/campaigns/auto-policy-history-analytics-the-future-of-risk-segmentation/ >, accessed on June 18, 2025
7. Ibid. (Verisk study combining CVAO data with ISO Statistical Plan loss cost data, 2025. Limited to policy history data and statistical plan data available for research. Results may vary based on full production data and the risk profile of individual insurers’ books of business, as well as the sophistication of their current rating plan. Actual data points not shown due to the proprietary nature of the data. Analysis based on 5-year lookback period.)
8. Ibid. (Analysis based on most recent policy term.)