Faster Claims Settlement, Better First Notice of Loss Explanation Drive Satisfaction

Jeremy Bowler

Jeremy Bowler

Overall customer satisfaction with handling of auto insurance claims rises three points to 855 (on a 1,000-point scale) from 852 in 2012, mainly due to higher scores in managing the first notice of loss (FNOL) process and also providing quicker payments to claimants, according to the J.D. Power 2013 U.S. Auto Claims Satisfaction Study.SM

Among factors evaluated, overall satisfaction with first notice of loss improves by four points due to insurers providing better explanations to claimants of both the policy coverage and claims process, the study finds. Satisfaction with claims settlement improves by three points as insurers are paying faster—over half (51%) of claimants received their payment within eight days of the FNOL in 2013, which is up from 45% in 2012.

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First Call to Insurer Sets Tone for Canadian Auto Insurance Claimant Satisfaction

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Jeremy Bowler

Although settlement of an auto insurance claim is the most important factor among six measures* evaluated in our 2013 Canadian Auto Claims Satisfaction Study, the first phone call that a claimant makes to the insurance provider or agent after an accident or vehicle damage incident sets the tone for the whole claims process. The first notice of loss call averages 18 minutes, according to the study.

 Auto Insurance Claimant Satisfaction Differs by Province

Our inaugural Auto Claims Satisfaction Study in Canada finds that satisfaction with the auto claims experience varies between provinces. For instance, satisfaction ranges from a high index of 840 (on a 1,000-point scale) in Quebec to only 753 on average in Manitoba. Satisfaction scores for some of the other regions are: Ontario (800); Alberta (770); British Columbia (767); and Saskatchewan (760).

Overall, the industry satisfaction score with the auto claims experience in Canada averages 787. Continue reading ›

Regional Storm Events Impact U.S. Auto Claims Satisfaction

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Jeremy Bowler

Satisfaction with the experience of filing and settling an auto claim among customers who finalized a claim in the past 6 months improved by 2 points in the second quarter from the first quarter, according to our 2013 Auto Claims Satisfaction Study—Wave 3.

However, small improvements in satisfaction with repairable claims were offset by significant declines in satisfaction among total-loss claimants, the study finds. These declines are partially due to the impact of more claims filed in the Mid-Atlantic region after damages from Superstorm Sandy last year and a powerful nor’easter storm in February 2013.

While auto claims satisfaction is up 2 points and satisfaction in four of the six factors* measured is also up from Wave 2 (January-March 2013), satisfaction with the appraisal process among total-loss claimants declines by 25 points. Continue reading ›

Satisfaction with Auto Insurance Providers Dips in 2013

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Jeremy Bowler

Customer satisfaction with auto insurance companies in the U.S. market declines by 10 points to 794 (on a 1,000-point scale) from a record high in 2012, according to our 2013 U.S. Auto Insurance Study, mainly due to a sharp increase in the number of customers who have experienced premium increases.

Although the study’s overall satisfaction average dips in 2013 vs. 2012, it is the second-highest index since the study launched in 2000. The major declines this year across all five factors measured in the study are with the price and policy factors—each declines by 13 points from 2012. These two measures contribute the most to lower overall satisfaction.

Premium Increases Climb by an Average of $40

In 2013, the dollar amount of premium increases averages $153, which is $40 higher than the average rate increase of $113 as reported in the 2012 study. We see that when there is an annual rate increase of $50 or less, only 9% of customers switch insurers. However, that nearly doubles to 18% when the rise is between $51 and $100, and it climbs to 32% when the increase is more than $200. Continue reading ›

Insurance Websites Offer More Satisfying Service vs. Shopping Experience

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Jeremy Bowler

More than half of all insurance shoppers today use the Web to scout their options and many also go further to seek to obtain quotes online, according to our J.D. Power research. However, our 2013 Insurance Website Evaluation Study (IWES), which measures online customer experiences in performing both shopping and service tasks*, finds that requesting a quote and finding policy information are two of the most difficult tasks listed by auto insurance customers.

The good news is that auto insurance customers who have an existing policy find it easier to use their provider’s site to view policies, change contact information and pay premiums rather than using a provider’s site to shop for a policy. We find that customers who have a good experience are more likely to return and recommend the website.

Among the 20 insurance provider websites examined in the study, Esurance, Progressive and GEICO perform particularly well in the ease of use for both shopping and servicing with their websites. Continue reading ›

Multi-Channel Interaction Gains Ground for Auto Insurance Customers in Canada

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Jeremy Bowler

Mainstream adoption of technology is making a big difference in the way auto insurance customers in Canada interact with their insurance provider, according to our 2013 Canadian Auto Insurance Satisfaction Study, which is based on responses from 11,257 auto insurance policyholders in Canada.

An increasing number of consumers are going to the Web for their first point of contact to gather information, according to our 2013 study. This year, the percentage of customers using non-traditional channels, such as an auto insurance provider’s website, has increased by as much as 7 percentage points from 2012, and now accounts for as much as one-third of all customer interactions, depending on the particular region.

Among customers who contact their insurance company, nearly one-half (49%)—including those of agent/broker-based insurers (43%) and direct insurers (57%)—use multiple channels to contact their provider. Continue reading ›

Auto Insurance Claims Satisfaction Dips; Out-of-Pocket Expenses Up

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Jeremy Bowler

Satisfaction with the experience of filing and settling an auto claim among customers who settled a claim in the past 6 months dropped from the previous period, partly due to higher out-of-pocket costs (including the deductible and car rental), according to the J.D. Power and Associates 2013 Auto Claims Satisfaction StudySM—Wave 2. Consumers who settled an auto insurance claim with their provider in the latest period paid an average of $499 for repairs, up $30 from $469 in 2012.

We see that satisfaction tends to slip during the winter months for several reasons. First, when consumers have an accident and need to repair their vehicle during the winter holidays, it’s not only an inconvenience, but it’s frustrating because they may have to dip into holiday savings to pay for repairs.

Another reason for the 11-point dip in satisfaction to 850 (on a 1,000-point scale) is that road conditions tend to batch accidents in the winter, causing volume peaks for the repair industry. This shows up in longer appraisal, settlement and repair times. Continue reading ›

Overall Auto Insurance Claims Satisfaction Improves with Faster Settlements

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Jeremy Bowler

The average time that a claimant waits to receive payment or a settlement in an auto physical damage loss dropped by 2.5 days to 13.9 days in the fourth quarter of 2012 vs. an average 16.4 days in the same period of 2011, according to our 2013 U.S. Auto Claims Satisfaction Study—Wave 1.*

As claims are being paid faster, satisfaction with the auto insurance claims process improves. According to the study, overall claimant satisfaction rose by 6 points to 861 (on a 1,000-point scale) from the fourth quarter in 2011—mainly due to an 11-point advance in settlement satisfaction. Slight increases in the ratings of two attributes of this factor—fairness of the claim settlement and timing of the settlement—contributed to the improvement. Continue reading ›

Canadian Auto Insurance Policyholders are More Satisfied with Carriers

Lubo Li

Customer satisfaction with Canadian auto insurance companies improves this year in each of the three geographic regions evaluated, mainly due to fewer premium increases in addition to higher satisfaction with policy offerings, according to results in our 2012 Canadian Auto Insurance Study. This year’s study is based on responses from 11,620 auto insurance policyholders. Some findings from each of the regions are highlighted below:

Quebec Region

Satisfaction in the Quebec region increases by 17 points (based on a 1,000-point scale), which is the largest increase in score among all three regions from 2011. Satisfaction increases significantly in two of the five factors* that make up the overall customer satisfaction index: billing and payment (+21 points) and price (+19 points). In addition, only 11% of customers in the Quebec region say they experienced an insurer-initiated rate hike—the lowest percentage in all three regions.

La Capitale ranks highest in customer satisfaction among Quebec’s auto insurance companies with a score of 850 (on a 1,000-point scale). In fact, La Capitale receives the highest index score among carriers in all three regions this year. Continue reading ›

Wait and Hope—the Honda Fit EV Needs to Come to Market

What better place to test drive the new Honda Fit EV than Pasadena’s Rose Bowl, in one of the large parking lots, and take it for a short spin on the surrounding park road on a cloudless summer day.

Alongside the Reflection Blue Pearl Fit EV, which has a masculine, aerodynamic front end without a grille but a flourish of a ducktail spoiler, was a curvy white Nissan Leaf  for comparison driving. The Leaf was heavier, with more exotic-looking technology inside, while the Fit EV was more traditional with a user-friendly three-mode driving system and a key to turn instead of a remote that is used to start many alternative and hybrid vehicles. Both cars were easy to steer, quiet, and filled with the latest technology. The Leaf seemed looser to drive while the Fit EV seemed slightly more responsive, with less torque steer. Both compact car models allegedly seat 5 people—three of whom must be pint-size children. Both cars are earth-friendly.

Fit EV Coming to U.S. This Month

The Fit EV will begin to roll out in California and Oregon on July 20, according to Honda. Unfortunately, there is a catch with Honda’s new battery electric vehicle (BEV). It is a limited-production car—only 1,100 will be available during the next three years in the U.S. All 1,100 will be lease vehicles—3-year leases at $389 per month through Honda Financial Services, which computes to a suggested retail price of $36,625. Closed-end leases will include collision insurance, maintenance, roadside assistance, and navigation updates. The reason that the output is so low is that Honda’s sub-compact EV is being produced to comply with California’s rules to require a certain number of ZEVs (zero-emission vehicles) to be sold in the state. Continue reading ›