US auto insurance shopping and new business growth cooled from hot to warm in Q1 2026, according to LexisNexis Risk Solutions. Shopping grew 3.2% year-on-year, while new policy growth reached 3.6%, still above historic norms.
The private motor market continues to adjust after several years of steep rate increases, inflation pressure, repair-cost strain, and insurer profitability concerns.
By the end of Q1, almost half of in-force policies had been shopped at least once during the prior 12 months, with the annual shop rate reaching a record 47.3%.
The slowdown in shopping and new business suggests consumer behaviour has started to steady after a long period of disruption. Inflation, supply chain problems, and aggressive repricing had pushed many drivers to compare coverage more often.
LexisNexis tied the moderation partly to more insurer rate decreases in early 2026 and softer vehicle sales. Retention rates among auto policyholders have also flattened in recent months, adding another sign of a less frantic market.
March vehicle sales looked different from March 2025, when many consumers moved purchases forward ahead of possible tariffs. That earlier buying rush created an extra shopping spike.
Rate revisions continued to shape consumer behaviour. Across all US auto insurers, 35% of rate changes were decreases, 39% were increases, and 26% were neutral, with an aggregate Q1 rate reduction of 1.1%.
Average decreases were 5.1%, while average increases were 3.9%. Among the top 25 auto carriers, rate patterns looked similar, with a slightly higher share of decreases and comparable average movements.
LexisNexis said rate cuts usually prompt less shopping than rate increases. Regulators in several states have reviewed the pace and scale of recent auto insurance rate activity, so evidence of cuts could reduce some political and supervisory pressure on carriers.
Pricing remains cautious because repair costs, litigation trends, and weather losses remain uncertain. The shift toward more balanced rate actions suggests carriers see less pressure from the inflation shock, but they have not returned to loose pricing.
Channel performance remained uneven in Q1. The direct channel again led the market, with shopping growth of 9.4%, while the exclusive agent channel posted its second straight quarter of positive growth at 5.6%.
The independent agent channel moved in the other direction, with shopping down 7.9% after a small 0.1% decline in the previous quarter. Non-standard shoppers also weighed on overall growth after a 12.2% rise in Q4 2025 turned into a 5.8% decline in Q1 2026.
Inflation, affordability pressure, and the total cost of vehicle ownership likely affected that segment. Standard shoppers tracked closer to the wider market, with year-on-year growth of 3.9%, down from 6.5% in the prior quarter.
Drivers aged 66 and older kept showing the strongest shopping activity, recording a 7.1% year-on-year increase for the quarter.
Shopping fell 0.3% among drivers aged 26 to 35, rose 2.3% among those aged 36 to 45, and increased 3.4% in both the 45 to 55 and 56 to 65 segments.
Older policyholders often carry higher lifetime value and more stable risk profiles. LexisNexis said sustained shopping in that group matters for carriers seeking to rebalance portfolios after recent volatility.
Jeff Batiste, senior vice president and general manager for US auto and home insurance at LexisNexis Risk Solutions, said loyalty will separate short-term wins from sustainable growth as shopping levels off. He said insurers investing in retention should be better placed as the market shifts from rapid expansion to measured momentum.
Batiste said once-loyal, profitable customers could now be available to competitors. He said insurers that recognise the shift can respond with stronger offers and personalised premiums.
