Insurance Blog

Insurers that provide highly satisfying home insurance claim experiences are more likely to see increased customer retention and loyalty, according to a new study from J.D. Power and Associates.
Its 2010 U.S. Home Claims Satisfaction Study finds that among home insurers that provide highly satisfying claims experiences, 71 percent of their claimants indicate that they “definitely will” renew with their insurer and only 4 percent say they have switched insurers following their homeowners claim.
In comparison, among insurers with lower levels of satisfaction, only 53 percent of claimants say they plan to renew, while 10 percent say they have switched insurers. Fewer than one-half (48 percent) of these claimants say they “definitely will” recommend their insurer.
In a press release, Jeremy Bowler, senior director of the insurance practice at J.D. Power and Associates notes that suffering a property loss and filing a claim tends to be an emotionally charged experience – often more […]

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Customer satisfaction with the property/casualty insurance industry slipped a bit in the fourth quarter of 2009. According to the latest University of Michigan American Customer Satisfaction Index (ACSI), the p/c sector showed a slight drop of 1.2 percent to a score of 80 in Q4 2009. That said, several p/c insurers improved their customer relationships in 2009. Among property/casualty insurers, four of the five measured companies improved (with one steady), but the gains were all small. ACSI data indicates the decline in the industry overall is due to a 3 percent ACSI drop in the aggregate of all other smaller insurers, which are challenged to provide the same rates as their larger competitors, focusing instead on service. In the aggregate, customer satisfaction with the finance and insurance sector (including banks, credit unions, and property, life and health insurance) improved 1.4 percent to an ACSI score of 77.1. Even though some […]

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Despite recent housing market troubles, homeowners appear to be very happy with their insurance companies. The J.D. Power and Associates 2009 Homeowners Insurance Study reports that for the first time in five years, overall customer satisfaction with homeowners insurance has increased significantly, driven by favorable perceptions of the value of their policies. Satisfaction with homeowners insurance averages 773 on a 1,000-point scale in 2009 – an increase of 21 points on 2008. J.D. Power says the overall increase is primarily due to substantial improvements in the price, policy offerings and billing and payment factors. Satisfaction with price improved most notably – increasing by 46 points from 2008. The apparent prevalence of discounts also contributed to improved perceptions of policy value. The study found that the percentage of policyholders who reported receiving discounts increased in 2009 to 84 percent from 81 percent in 2008. Of the 27 insurers included in the […]

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Retaining existing customers has never been more important for insurance carriers in terms of long-term profitability, according to a new survey from J.D. Power and Associates. The 2009 Personal Insurance Retention Special Report finds that even though 90 percent of customers overall stayed with their insurer during the past 12 months, those households that are more impacted by the recession present a real challenge for insurance carriers. The report finds that in the past year, 30 percent of households with annual incomes below $50,000 shopped for a new insurance carrier and 45 percent of those customers eventually switched carriers. In contrast, only 26 percent of more affluent households (annual incomes of $100,000 or more) shopped for a new carrier, with only 31 percent of customers eventually switching. The survey also finds that there are significant variances in customer retention between different consumer demographic or attitudinal groups. For example, while retention […]

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Agent satisfaction can have a major impact on policy growth for an insurance company according to a new study from J.D. Power and Associates. It found that as agent satisfaction increases, the likelihood of agents increasing their premium business with an insurer also rises. In 2009, nearly 70 percent of agents with satisfaction scores averaging more than 800 points on a 1,000 point scale indicate they tend to increase business with the insurance company. In contrast, only 28 percent of agents with scores averaging 600 points or less indicate the same. So what makes for a satisfied agent? Interestingly J.D. Powers found that compensation is not the primary driver of agent satisfaction. “Insurers that provide helpful and knowledgeable business contacts and provide a variety of policy offerings help to better meet the needs of consumers, which leads to greater levels of satisfaction among agents,” said Jeremy Bowler, senior director of […]

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Delays (19.1 percent), denial of claims (18.4 percent) and unsatisfactory settlement offers (14.2 percent) were once again the top three reasons consumers filed formal complaints against their insurance companies in 2008, according to data just released by the National Association of Insurance Commissioners (NAIC). Premium/insurance rating issues (4.7 percent) and policy cancellations (4.0 percent) rounded out the top five, regulators said. By type of coverage, the top three complaints in 2008 were: accident & health (36.9 percent); auto (36.7 percent); and homeowners (11.8 percent). The good news is that the total number of complaints declined for the fifth consecutive year in 2008. A total of 195,669 confirmed consumer complaints on insurers were reported via the NAIC’s Complaint Database System (CDS) in the 2008 calendar year. States voluntarily report “closed” complaints via the CDS. A closed complaint is a complaint that has been investigated and resolved to the satisfaction of the […]

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Even as the economy weakened, customer satisfaction with the property/casualty insurance industry remained high in the fourth quarter of 2008, improving over 2007 levels. The latest University of Michigan American Customer Satisfaction Index reveals that the p/c sector saw a 1.3 percent gain to record a score of 81 in Q4 2008. In the aggregate, customer satisfaction with the finance and insurance sector improved 0.7 percent to 76, erasing a corresponding deficit from a year ago (see our February 20, 2008 posting). A gain in ACSI for health insurance (+ 2.8 percent to 73) and the more modest gain in p/c insurance more than offset a decline in satisfaction with banks (-3.8 percent to 75). Meanwhile, satisfaction with life insurance stayed the same.  The finance and insurance sector includes commercial banks and property and life and health insurers, as well as a new ASCI entrant — credit unions. The index […]

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