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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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 ›

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 ›

Southeast Region Achieves Highest-Ranking Auto Insurance Satisfaction Scores

Customer satisfaction with auto insurance companies in the seven regions of the U.S. varies from the highest regional industry average of 814 (on a 1,000-point scale) in the Southeast region to a low of 784 in the Northeast region of the country, according to results of the J.D. Power and Associates 2012 U.S. Auto . . . Continue Reading Southeast Region Achieves Highest-Ranking Auto Insurance Satisfaction Scores

Switching Remains Hot Topic in Online Auto Insurance Chatter

J.D. Power’s Consumer Insight and Strategy Group* has discovered that a significant percentage of social media comments on the topic of personal auto insurance rate hikes suggest a strong desire among consumers to switch insurers, or to begin the shopping process. In addition, discussions ask whether others have experienced similar results with a specific . . . Continue Reading Switching Remains Hot Topic in Online Auto Insurance Chatter

Engaging, Easy-to-Use Websites Attract More Online Auto Insurance Shoppers

Jeremy Bowler

Nearly three-fourths of all auto insurance shoppers visit at least one insurer’s website as a first point of contact with the company, which gives insurers a fantastic opportunity to gain shoppers and their referrals.  Providing a website that is easy to use and has a professional and engaging appearance can be a great resource in the shopping experience. This is especially important since we know that one-third (34%) of auto insurance shoppers prefer to buy their policy online.

A few highlights are featured from the 2012 Insurance Website Evaluation Study, which is our first study to evaluate shoppers’ experiences with insurer websites during the auto insurance shopping process:

• The quote process should be fast and simple. Some 72% of shoppers who requested a quote online said they received a quote immediately, while 18% said they were required to wait for a follow-up response and 10% said they didn’t receive a quote.

• Overall satisfaction among shoppers who say their quote experience was faster than expected is 857 (on a 1,000-point scale), which is 245 points higher than the average score among shoppers who say it took longer than expected. Continue reading ›

Retention is on the Rise, Yet More Shoppers Switch Insurers

Jeremy Bowler

Although only 25% of auto insurance customers say they shopped for a new insurer during the past 12 months, which is down 8 percentage points from 2011, some 43% of these shoppers switched auto insurance providers, according to our 2012 U.S. Insurance Shopping Study.

This year’s switching rate among shoppers, which is up 3 percentage points from 2011, is the highest since we first began measuring retention in 2008. Our Insurance Shopping Study evaluates consumer shopping and purchasing behaviors and overall satisfaction among buyers who recently purchased auto insurance.

It’s likely that the increase in the proportion of shoppers actually switching insurers means that fewer price-checkers are gathering quotes, which may be a direct result of lower savings derived from switching. In fact, our findings indicate that the typical savings derived from switching has declined from an average of $412 in 2010 to an average of $359 during the past 12 months.

At the same time, customer retention rates are rising even though auto insurance companies are spending more money to entice customers to switch insurers. This is noteworthy since industry-wide advertising expenditures rose 12% in 2011 from 2010, based on analysis of data performed by Dowling and Partners, LLC. Continue reading ›

Satisfaction with Auto Claims Experience Declines in Recent Period

Jeremy Bowler

For the first time in three calendar quarters, satisfaction with the claims experience among auto insurance customers who filed an auto claim for damage to their vehicle has declined. In fact, the industry index score dropped 13 points to 842 (on a 1,000-point scale), according to the J.D. Power and Associates 2012 U.S. Auto Claims Satisfaction StudySM—Wave 2.

Among the six factors* measured in the study, First Notice of Loss, which is when the customer first notifies the insurance provider of damage to their vehicle, experienced the biggest drop (-19 points). Some 47% of claimants delayed dropping off their vehicle at the body shop in order to wait for a more convenient time, and 20% indicated waiting for weekends or holidays. Continue reading ›

Total Loss Auto Insurance Claimants are Least Satisfied

 

Jeremy Bowler

Auto insurance customers who file a claim that results in a total vehicle loss are much less satisfied with the claims experience than are those customers who file a claim for a repairable vehicle, according to our 2011 U.S. Auto Claims Satisfaction Study, which measures six key factors* that impact satisfaction with the claims process for auto physical damage loss.

Our most recent study, which is based on more than 11,500 responses from auto insurance customers who filed a physical damage loss claim** within the past 12 months, finds that satisfaction with the claims experience averages just 811 (on a 1,000-point scale) among claimants filing a total loss—that’s 42 points lower than the average among those claimants whose vehicles were repaired.

The gap is mainly due to less satisfaction with the settlement amount received. Nearly one-half of total loss claimants indicate the settlement wasn’t enough to replace their totaled vehicle with a similar make/model vehicle. Continue reading ›