18% Higher F&I Gross Profit with Insurance Quotes
In Q4 2024, the average increase in back-end gross for dealerships that introduce their customers to Polly was 18%, for Q4 average lift of $331 dollars.
Q4 2024
Quarterly Embedded Auto Insurance Report
Insights on the embedded auto insurance opportunity for automotive dealers
Auto Insurance Rates Stabilized in 2024
The average in-dealership auto insurance quote averaged around $200 throughout 2024, topping off at an average of $202 per quote in Q4.
While this is good news, quotes are still creating price shock for many consumers, as it still represents an increase of more than $60 per month in the last two years. And quotes in higher cost states are 50% or more above the average 2024 rate, creating an affordability crisis for many car buyers and disrupting car sales for dealers.
Average Monthly Insurance Quote1
Insurance Quotes Averaged $199 a Month in 2024
This represents an 18% YOY Increase from 2023, far outpacing the overall rate of inflation, and eclipsing changes in the consumer price index for new and used vehicles, which declined in 2024 by .4% and 3.3% respectively.
Back-End Gross increased to 63% of the Total Gross Profit for Retail Auto Sales in Q43
In the last quarter of 2024, front-end gross dove towards $1,000, down 29% year over year. This decline is driven by increased auto inventory and declining affordability.
However, back-end gross has remained constant for all of 2024, hovering within $55 of the average of $1,868 for the full year.
Insurance and Back-End Gross Improvement Across Top 10 Dealerships
In Q4, all our top ten most engaged dealer groups continued to see higher back-end gross with insurance, in line with the averages seen during the first three quarters of the year.
Fluctuation between groups is largely a function of average F&I penetration at each dealership.
AVERAGE BACK-END GROSS PER DEAL: 10 FRANCHISE DEALER GROUPS 4
18% Higher F&I Gross Profit with Insurance Quotes
In Q4 2024, the average increase in back-end gross for dealerships that introduce their customers to Polly was 18%, for Q4 average lift of $331 dollars.
Predictions for 2025
The embedded insurance opportunity for dealers, (positive effect of buying car insurance at the dealerships) has recovered to rates not seen since 2021, and will continue to improve in 2025.
States like New York, Maryland, and Georgia will remain outliers with high insurance rates due to regional risk factors, regulatory differences, and carrier pricing strategies. This will further drive demand for competitive, embedded insurance solutions at the dealership level.
With front-end gross shrinking due to inventory normalization and affordability challenges, dealers will increasingly rely on F&I products to maintain profitability. Expect more dealers to integrate embedded insurance solutions into their sales process to capture additional back-end revenue.
Predictions for 2025
The embedded insurance opportunity for dealers, (positive effect of buying car insurance at the dealerships) has recovered to rates not seen since 2021, and will continue to improve in 2025.
States like New York, Maryland, and Georgia will remain outliers with high insurance rates due to regional risk factors, regulatory differences, and carrier pricing strategies. This will further drive demand for competitive, embedded insurance solutions at the dealership level.
With front-end gross shrinking due to inventory normalization and affordability challenges, dealers will increasingly rely on F&I products to maintain profitability. Expect more dealers to integrate embedded insurance solutions into their sales process to capture additional back-end revenue.
