Insurers that communicate clearly with their customers, accurate estimate the length of the claims process and provide a personalized and superior claims experience to their customers is the key to creating happy customers according to the 2019 U.S. Property Claims Satisfaction Study published by J.D. Power. The reality, however, is that the vast majority of insurers are not addressing these customer expectations in the face growing online options.
“Overall customer satisfaction remains high and the leading providers continue to outperform their peers by a comfortable margin,” said David Pieffer, Property & Casualty Lead for J.D. Power Insurance Intelligence. “However, there also are obvious areas for improvement where insurers could do a better job of managing customer expectations. As the industry keeps shifting toward more personalized, usage-based and on-demand insurance options, the ability to communicate effectively and make claimants feel at ease along the way will be a key differentiator for top-performing insurers.”
For this year’s study, J.D. Power queried 6,374 homeowner insurance customers about their property claims experience. The annual measured a customers satisfaction as a result of filing a claim for damages by examining five factors ranked by order of importance:
- claim servicing;
- first notice of loss;
- estimation process; and
- repair process
What the study found
“Against a backdrop of deteriorating property loss ratios and low premium growth, property insurers are earning high marks for overall customer satisfaction, but there are still some components of the claims process that are falling short.” In particular, the three aspects of the claim process which received the lowest rankings of the study included —how well customers are kept informed on the progress of their claim; time to settle the claim; and fairness of the claim settlement—earn among the lowest ratings of all study attributes.
The following are some of the other major findings from the study:
- Many insurers miss the mark on customer communications: The three components of the claims process that have the highest importance weights in overall satisfaction metrics are among those rated lowest by claimants: fairness of the claim settlement (settlement); how well you were kept informed on the progress of the claim (claim servicing); and time to settle the claim (settlement). This shines a spotlight for insurers on effective communications as an area for improvement.
- Setting accurate claim length expectations is critical: Overall customer satisfaction among claimants who receive accurate claim length estimates is 151 points higher, on average, than among those whose claim takes longer than expected (905 vs. 754, on a 1,000-point scale). Satisfaction is even lower (753) when no expectation is set at all.
- Concierge-type services provided at first notice of loss (FNOL) boost customer satisfaction and advocacy: When insurers make a hotel reservation for a claimant immediately upon FNOL, satisfaction increases by 42 points and results in a significant increase in Net Promoter Score®. Other ancillary services driving satisfaction and advocacy include discussing repair options (+44 points); notifying a repair company (+38); and scheduling an estimate (+33).
- Insurance customers experience considerable variation in claims service: The gap in property claims satisfaction between the highest- and lowest-performing insurers is 76 points, underscoring the importance for customers shopping for insurance to select a P&C insurer that can deliver a superior claims service.
Three Massachusetts homeowner’s insurers make the list
The following is a list of the major U.S. homeowner’s insurance companies and how they ranked against one another: