New Migration Patterns Create Opportunities for Carriers to Expand their Book of Business

More and more people moved out of typically high-demand states in favor of up-and-coming regions last year, according to the 2018 U.S. Migration Report by northAmerican Moving Services. This allows carriers a prime marketing opportunity to expand their book of business into new areas. The report found that last year, Illinois, California and New Jersey saw the highest net-loss of residents in 2018. Meanwhile, smaller markets, including Idaho, Arizona and South Carolina, experienced substantial growth.

Some of this migration is owed to affordability concerns in states like California, where increases in housing prices were paired with a dip in consumer confidence. Another reason for this shift is due to a surge in first time homeowners. In November 2018, millennials overtook Generation X in its share of mortgages by value. Not only are millennials now responsible for the most mortgages, but they now also maintain the largest share of buying power in the marketplace. For carriers, this poses a new opportunity.

Property Intelligence Supports Marketing Penetration Strategy

Spring homebuying season may bring some relief to the housing slowdown. With the potential of an economic recession threatening insurer growth, carriers can leverage property intelligence, specifically insights into remodeling activity, to identify markets with favorable risk profiles. Remodeling activity is a sign of consumer confidence, as homeowners do not make significant investments in their property if they are in fear of losing their jobs. Overall, this information provides carriers with a competitive edge to better understand up-and-coming markets and determine how best to allocate agency resources.

Traditional Markets Expose New Property Risks

California experienced consecutive decreases in year-over-year maintenance activity for a majority of 2018, suggesting the state’s aggregate property risk may not be as strong as it has been in years prior – decreases in maintenance activity are highly correlated with increased property risk.

On the other hand, Kentucky, Nevada and Kansas saw continued growth in maintenance volume last year. Maintenance activity in Nevada grew 44.91 percent in 2018 year to date while remodeling activity rose 24.99 percent in that same time period. Kentucky saw maintenance activity increase 18.45 percent year to date in 2018 and Kansas maintenance volumes jumped 40.90 percent. In these cases, carriers may have an early glimpse into an emerging market for insured homes.

Insurers who are expanding their book of business may leverage recent maintenance and remodeling data to identify states with ideal risk profiles. Beyond simply evaluating structure improvements, BuildFax enables carriers to find value specific to their needs. Our underwriting insights shine a light on which properties, by address, meet a carrier’s eligibility requirements. For instance, BuildFax can identify the presence of a pool, fire prevention measures, security updates and more. Carriers can use these details to validate existing data, accelerate quote to bind and optimize their inspection dollars.

To get more insight on a research-driven, validated approach to new market expansion, contact a BuildFax representative today.