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Category: InsuranceUnited States

  • 2024 U.S. Small Commercial Insurance Study

    Small Commercial Insurance Customer Retention Hinges on Trust in Rising Rate Environment, JD Power Finds

    2024-08-19

    jillian.breska

    TROY, Mich.: 20 Aug. 2024 — Even in an environment of rising rates in which 36% of small business owners have experienced premium increases during the past year, overall customer satisfaction, loyalty and brand advocacy stay strong when customers trust their commercial insurance providers. According to the JD Power 2024 U.S. Small Commercial Insurance Study,SM released today, among small businesses with the highest levels of trust in their insurers  81% say they “definitely will” renew with their carrier and 79% say they “definitely will” recommend their carrier. Overall trust levels, however, vary widely by insurer.

    “Trust is the single most important variable in the customer relationship with commercial insurance providers,” said Stephen Crewdson, senior director of global insurance intelligence at JD Power. “Across virtually every business metric that matters to insurers—customer loyalty, advocacy, premium retention, share of wallet—small business owners who trust their insurers represent significantly higher value. While some insurers are doing a great job cultivating that trust, others have a lot of work to do.”

    Following are some key findings of the 2024 study:

    • Trust is key value driver for commercial insurers: Overall small business customer satisfaction with commercial insurers is 697 (on a 1,000-point scale). Among customers who have the highest levels of trust in their insurance providers, overall satisfaction jumps 180 points to 877. Similarly, 81% of customers with the highest levels of trust say they “definitely will” renew with their carrier and 79% say they “definitely will” recommend their carrier.
    • Trust varies widely among small commercial insurers: A 77-point gap separates the insurer with the highest overall trust score from the insurer with the lowest trust score. Insurers that achieve the highest levels of trust perform well on helping their customers understand policy coverage, understand their business needs and personalize products to their specific business needs.
    • Premium increases rising: Overall, 36% of small businesses experienced a premium increase this year, up from 34% in 2023. Of those, 51% of increases were initiated by the insurer, 16% were the result of changing business needs and 13% were due to a change the customer made to their policy.
    • Understanding reasons for premium increases critical to maintaining trust: When customers completely understand the reasons for a premium increase, trust is 142 points higher than when they do not understand. Notifying customers in advance, particularly via phone and/or in person, and proactively discussing ways to reduce the increase will help customers understand the reasons and build trust.
    • Know your customer: Personalization has become a key driver of commercial insurance customer satisfaction, but nearly half of customers are not receiving it. Overall, 55% of commercial insurance customers say they’ve received information personalized to their business from their insurer, which in turn drives an average overall trust score of 761. Overall trust is 106 points lower (655) among the 45% of businesses for which insurance information is not personalized.

    Study Ranking

    American Family ranks highest in overall customer satisfaction with a score of 727. State Farm (719) ranks second and Allstate (716) ranks third.

    The U.S. Small Commercial Insurance Study was redesigned for 2024. It is based on responses from 2,817 small commercial insurance customers. The study, now in its 12th year, examines overall customer satisfaction among small commercial insurance customers with 50 or fewer employees. Overall satisfaction is measured across seven core dimensions on a poor-to-perfect rating scale. Individual dimensions measured are (in order of importance): trust; price for coverage; product/coverage offerings; ease of doing business; people; problem resolution; and digital channels. The study was fielded from February through June 2024.

    For more information about the U.S. Small Commercial Insurance Study, visit https://www.jdpower.com/business/insurance/us-small-commercial-insurance-satisfaction-study.

    About JD Power
    JD Power     is a global leader in consumer insights, advisory services, and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 55 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies.

    JD Power has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto-shopping tool can be found at JDPower.com.

    Media Relations Contacts
    Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
    John Roderick; East Coast; 631-584-2200; [email protected]

    About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

     

  • 2024 U.S. Insurance Digital Experience Study

    Auto Insurer Websites and Apps Become Primary Driver of New Customers, Putting Pressure on Digital Experience, JD Power Finds

    2024-05-20

    jillian.breska

    TROY, Mich.: 21 May 2024 — With auto insurance rates higher than ever and more consumers in the market shopping for policies than ever before,1 digital channels have become a critical component to the overall auto insurance shopping and service experience. According to the JD Power 2024 U.S. Insurance Digital Experience Study,SM released today, a strong majority of auto insurance websites and apps are doing a good job delivering on foundational functional capabilities, but far fewer are delivering the type of value-added services that set them apart from the pack.

    “When you consider the sharp declines in customer satisfaction we’ve been seeing across all aspects of the auto insurance industry during the past year, digital channels have been remarkably resilient when it comes to delivering a good user experience and helping to get customers and prospects the information they need,” said Stephen Crewdson, senior director, insurance business intelligence at JD Power. “However, many insurers still have work to do when it comes to keeping customers on their websites and apps to answer all questions and provide critical information. Customer satisfaction plummets when users of digital channels need to pick up the phone and contact the call center if they can’t find what they need online.”

    The U.S. Insurance Digital Experience Study evaluates the digital consumer experiences of both property and casualty (P&C) insurance shoppers seeking quotes and existing customers conducting typical policy-servicing activities. It examines the functional aspects of desktop, mobile web and mobile apps based on four factors: navigation; speed; visual appeal; and information/content. The study was conducted in collaboration with Corporate Insight, the leading provider of competitive intelligence and user experience research to the financial services and healthcare industries.

    “Engagement is the name of the game with insurance digital channels,” said Justin Suter, research manager at Corporate Insight. “The more customers engage with multiple different digital tools, the better experience they have and the more likely they are to develop a favorable overall impression of their auto insurance provider.”

    Following are some key findings of the 2024 study:

    • Overall digital satisfaction holds strong despite industry headwinds: Overall customer satisfaction with the P&C insurer digital shopping experience is 516 (on a 1,000-point scale), down 5 points from a year ago. Overall customer satisfaction with the P&C service experience is 698, down 4 points from a year ago. Relative to overall customer satisfaction scores with auto insurers in general—which fell 12 points in 2023 from 2022—the digital channel is performing admirably, despite soaring rates.
    • Digital channels bring in more customers than agents and call centers: More than half (53%) of first-time buyers start their relationships with auto insurance providers through digital channels, compared with 29% who come in through agents and 18% who come in through call centers. Similarly, digital is the first choice for 42% of switchers and 46% of retained customers. All of these have grown significantly during the past four years.
    • Satisfaction highest when customers have digital-only interaction with insurers: Overall customer satisfaction scores are considerably higher when customers use their insurer’s website or assisted digital contact methods as a first line of interaction than when they use another contact method first.
    • Moving beyond the basics: While most insurer digital channels are delivering foundational tools and navigation capabilities, fewer are making it easy for customers to perform more advanced tasks. In the service category, 83% of customers said digital channels delivered foundational experiences, but only 30% said they found the channels were foundational, findable and valuable. In the shopping category, 72% of customers said digital channels are delivering foundational experiences, but just 4% said they found the channels were foundational, findable and valuable.

    Study Rankings

    Progressive ranks highest in the service segment with a score of 737. American Family (717) ranks second and Nationwide (716) ranks third.

    Auto Club Group (AAA) ranks highest in the shopping segment with a score of 546. Auto Club of Southern California (AAA) (536) ranks second and Erie Insurance (533) ranks third.

    The 2024 U.S. Insurance Digital Experience Study is based on 11,086 evaluations and was fielded in January-March 2024.

    For more information about the U.S. Insurance Digital Experience Study, visit https://www.jdpower.com/business/insurance/us-insurance-digital-experience-study.

    About JD Power
    JD Power     is a global leader in consumer insights, advisory services, and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 55 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies.

    JD Power has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto-shopping tool can be found at JDPower.com.

    Media Relations Contacts
    Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
    John Roderick; East Coast; 631-584-2200; [email protected]

    About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

    1JD Power 2024 U.S. Insurance Shopping StudySM

     

  • 2024 U.S. Insurance Shopping Study

    Half of Auto Insurance Customers Currently Shopping for New Policies, JD Power Finds

    2024-04-26

    jillian.breska

    TROY, Mich.: 30 April 2024 — [Updated 30 May 2024] The average cost of auto insurance in the United States is up 22.2% year over year through the end of March, more than any other category of household expenses measured in the U.S. Department of Labor Statistics Consumer Price Index.1 According to the JD Power 2024 U.S. Insurance Shopping Study,SM released today, that notable increase in premium—combined with lackluster customer satisfaction scores this year—is putting more insurance customers into the market for a new policy than ever before. Nearly half (49%) of U.S. auto insurance customers say they are actively shopping for a new plan.

    “After the past few years of steady auto insurance premium increases, customers are no longer passively keeping an eye out for a better deal,” said Stephen Crewdson, senior director, insurance business intelligence at JD Power. “Instead, they are actively seeking new carriers to offset these rising costs. However, with rising premiums across the country and fewer insurers explicitly offering usage-based insurance—or UBI plans—during the quoting process, insurance shoppers are not finding many alternatives.”

    Following are some key findings of the 2024 study:

    • Auto insurance shopping and switch rates increase: Nearly half (49%) of auto insurance customers have actively shopped for a new policy in the past year. Of those, 29% have switched carriers. Switch rates are highest among members of Generation Z.2 Average overall satisfaction among auto insurance shoppers is 676 (on a 1,000-point scale).
    • EV owners confront insurance sticker shock:  Electric vehicle (EV) owners are less satisfied with the auto insurance purchase experience than are customers insuring gasoline-powered vehicles. The average purchase experience satisfaction score among EV owners is 663, which is 16 points lower than the average score among owners of gas-powered vehicles. This gap is attributable to lower satisfaction with the quote process and price of the policy because EVs are typically more expensive to insure than comparable gas-powered vehicles.
    • Insurers pull back on offering UBI when quoting: UBI programs, which use telematics software to monitor an insured’s driving style and assign rates based on safety and mileage metrics, were only offered to 15% of insurance shoppers this year, down from 22% a year ago and 20% in 2022. Customers enrolling in UBI programs show just a 6-point increase in price satisfaction in 2024, which is down considerably from a 32-point difference in 2023.
    • Growing interest in dealer- and manufacturer-provided insurance: More than one-third (35%) of auto insurance customers say they are interested in embedded insurance, a form of auto insurance that is provided directly through the automobile dealer or manufacturer.
    • Customer acquisition funnels play key role in market share: State Farm and Progressive show increases in customer yield through the customer acquisition funnel while GEICO’s acquisition funnel narrowed this year. Accordingly, State Farm and Progressive show gains in market share in this year’s study, while GEICO’s share is down.

    Study Ranking

    Erie Insurance ranks highest among large auto insurers in providing a satisfying purchase experience, with a score of 730. Automobile Club of Southern California (AAA) (705) ranks second and American Family (702) ranks third.

    The JD Power U.S. Insurance Shopping Study was redesigned for 2024. Now in its 18th year, the study captures advanced insight into each stage of the shopping funnel and is based on responses from 10,003 insurance customers who requested an auto insurance price quote from at least one competitive insurer in the previous six months. The study was fielded from March 2023 through January 2024.

    For more information about the U.S. Insurance Shopping Study, visit https://www.jdpower.com/business/resource/jd-power-us-insurance-shopping-study.

    About JD Power
    JD Power     is a global leader in consumer insights, advisory services, and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 55 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies.

    JD Power has offices in North America, Europe, and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto-shopping tool can be found at JDPower.com.

    Media Relations Contacts
    Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
    John Roderick; East Coast; 631-584-2200; [email protected]

    About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

    1U.S. Department of Labor Statistics Consumer Price Index, March 2024 https://www.bls.gov/news.release/cpi.nr0.htm#:~:text=Indexes%20which%20increased%20in%20March%20include%20shelter%2C,insurance%2C%20medical%20care%2C%20apparel%2C%20and%20personal%20care.
    2JD Power defines generational groups as Pre-Boomers (born before 1946); Boomers (1946-1964); Gen X (1965-1976); Gen Y (1977-1994); and Gen Z (1995-2006). Millennials (1982-1994) are a subset of Gen Y.

     

  • 2023 U.S. Claims Digital Experience Study

    Many Insurers Struggle to Deliver Seamless Digital Experience as Repair Cycle Times Rise, JD Power Finds

    2023-12-04

    jillian.breska

    TROY, Mich.: 5 Dec. 2023 — With customers saying their average auto repair cycle time has doubled in the past two years—now topping 23 days—and the average home repair cycle time increasing as well, insurers need to work harder than ever to manage customer expectations. According to the JD Power 2023 U.S. Claims Digital Experience Study,SM released today, digital communications channels have become the key to maintaining customer satisfaction throughout the claims process, but many insurers are still struggling to deliver a truly seamless digital experience. As a result, overall satisfaction is 854, down 3 points from 2022.

    “Across all of our insurance claims experience studies, we find that the more insurers can do to manage expectations, keep customers updated and make it easy for them to manage the claims process without a lot of effort, the more satisfied customers become—even when repair cycle times are longer than ever,” said Mark Garrett, director of global insurance intelligence at JD Power. “Customers have an expectation that using digital tools will create efficiencies in the process and keep them informed throughout their claim, but many insurers struggle to meet those expectations. Only 41% of customers ‘completely agree’ both expectations were met. Whether it is making the claim, submitting photos or communicating with claims staff, there are still bumps along the digital road. Notable, too, is that only 35% of customers said the estimation process was ‘very easy.’”

    Fortunately, when these experiences go well satisfaction is very positively affected. Digital communications in the form of personalized text messages, status updates via mobile apps and guides to help reading estimates can dramatically improve that experience without significantly raising customer service costs for insurers. However, many customers still indicate they need to pick up the phone to track down a status update, often resulting in repeating information to a representative. This negatively affects the overall customer experience.

    The U.S. Claims Digital Experience Study, now in its fourth year, evaluates digital experiences among P&C insurance customers throughout the claims process. It examines the functional aspects of desktop, mobile web and mobile apps based on four factors: visual appeal; clarity of the information; navigation; and range of services. The study is conducted in collaboration with Corporate Insight, the leading provider of competitive intelligence and user experience research to the financial services and healthcare industries.

    “Perception is everything when customers are going through an insurance claim,” said Michael Ellison, president of Corporate Insight. “If it feels like the insurer is proactively managing the process and making it efficient and easy to communicate, customers come away with a very satisfying experience. Effective use of digital channels delivers that high touch, personalized experience and digital leaders are finding they can better manage customer engagement, increasing customer satisfaction and retention when they get the formula right.”

    Following are key findings of the 2023 study:

    • One-third of claimants still need to call insurer following digital update: Overall customer satisfaction with the digital claims experience is highest when claimants receive an email, text or mobile app update that answers all of their questions. However, 33% of claimants say they needed to contact their insurer to ask additional questions following a digital update, causing overall satisfaction to fall 78 points (on a 1,000-point scale).
    • Easy Digital experience drives satisfaction and loyalty: Among customers who state that claim reporting, estimation and settlement processes were all “very easy,” satisfaction is 948—and 86% of those customers say they “definitely will” renew their policy. Satisfaction and renewal rates fall to 895, with 69% of those who state some of those processes were very easy. Among those who state none of them were very easy, satisfaction is only 799 and only 41% say they “definitely will” renew with the same carrier.
    • Few insurers manage to deliver all benefits of a digital experience: While most claimants agree that their insurer’s digital tools deliver on at least one element of a comprehensive digital experience, just 35% agree that their insurer is hitting the mark on three main criteria: creates an efficient claim process; keeps customers informed; and reduces time spent on the phone.
    • Repeat photo and info submission requests sap customer experience: Overall customer satisfaction scores among the 58% of insurance claimants who only needed to submit photos of their damaged property once is 875. That score falls to 837 when they needed to submit photos two times and 806 when they needed to submit photos three times or more.

    The 2023 U.S. Claims Digital Experience Study is based on 3,184 evaluations by auto or home insurance customers who filed a claim in the past 12 months. The study was fielded from June through October 2023.

    For more on the U.S. Claims Digital Experience Study, visit https://www.jdpower.com/business/insurance/us-insurance-claims-digital-experience-study.

    About JD Power
    JD Power is a global leader in consumer insights, advisory services and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 50 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies.

    JD Power has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto shopping tool can be found at JDPower.com.

    About Corporate Insight
    Corporate Insight     delivers competitive intelligence, user experience research and consulting services to the nation’s leading financial and health institutions. As the recognized industry leader in customer experience research since 1992, CI has been the trusted partner to corporations seeking to improve their digital capabilities and user experience. Their best-in-class research platform and unique approach of analyzing the actual customer experience helps corporations advance their competitive position in the marketplace. To learn more, visit http://www.corporateinsight.com.

    Media Relations Contacts
    Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
    John Roderick; East Coast; 631-584-2200; [email protected]

    About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

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  • 2023 U.S. Auto Claims Satisfaction Study

    Auto Insurers Manage Customer Expectations as Repair Cycle Times Double in Two Years, JD Power Finds

    2023-10-24

    jillian.breska

    TROY, Mich.: 26 Oct. 2023 — Long repair shop backlogs and lingering parts shortages have caused the average auto insurance repair cycle time to reach 23.1 days in 2023, up 6.2 days from 2022 and more than double the average repair time in 2021. According to the JD Power 2023 U.S. Auto Claims Satisfaction Study,SM released today, that long delay has not adversely affected customer satisfaction. Surprisingly, customer satisfaction with the auto insurance claims process improves this year, thanks to concerted efforts by insurers to carefully manage customer expectations.

    “It’s really a testament to strong client management processes and improved digital communications,” said Mark Garrett, director of global insurance intelligence at JD Power. “Insurers have been able to earn significantly higher auto claim satisfaction scores at a time when costs and rates are rising—even though it’s never taken longer to get a vehicle repaired. Notable, too, is that insurers that have improved the most in overall satisfaction have done so in two key customer areas: showing concern for their situation at the beginning of the process and keeping them informed. Being empathetic toward the customer situation goes a long way in building trust with them.”

    Following are key findings of the 2023 study:

    • Overall satisfaction improves across most aspects of claims experience: Overall satisfaction with the auto insurance claims process this year rises 5 points (on a 1,000-point scale) to 878. This increase is driven by improvements in nearly every factor, including settlement; first notice of loss; claim servicing; estimation process; and repair process. The only factor to decline this year is rental experience, which falls 2 points.
    • Repair cycle times now longer than ever: This year’s improvement in overall satisfaction comes despite it taking longer than ever for vehicles to be repaired. The average repair cycle time from first notice of loss (FNOL) to returning the vehicle to the claimant is now 23.1 days, an increase of 6.2 days from 2022 levels. The pre-pandemic average cycle time was 12 days.
    • Slow repair cycles affect rental car satisfaction: An increasing percentage of customers say their rental period is not long enough or that they are incurring out-of-pocket expenses, which is having an adverse effect on rental car satisfaction. Overall rental satisfaction for repairable claims falls 32 points when the car is needed for 15 days or more.
    • Aligning processes to customer preferences plays key role: Digital interactions are also driving an improvement in satisfaction, but primarily among those who prefer digital channels. Satisfaction declines among customers who prefer more personal interactions but are directed to digital processes. Aligning processes to preferences is key as customers increasingly want personal interactions—and doing so results in increased satisfaction.
    • Digital FNOL usage increases, but challenges remain: Nearly one-fourth (24%) of auto claimants are using digital FNOL methods to report a claim, with 13% using an insurer’s mobile app and 10% using the insurer’s website.

    Study Ranking

    Amica Mutual ranks highest in overall customer satisfaction for a second consecutive year, with a score of 909. Erie Insurance (902) ranks second and NJM Insurance Co. (900) ranks third.

    The 2023 U.S. Auto Claims Satisfaction Study is based on responses from 9,659 auto insurance customers who settled a claim within the past nine months prior to participating in the survey. The study excludes claimants whose vehicle incurred only glass/windshield damage or was stolen, or who only filed a roadside assistance claim. The study was fielded from September 2022 through August 2023.

    For more information about the U.S. Auto Claims Satisfaction Study, visit https://www.jdpower.com/resource/jd-power-us-auto-claims-satisfaction-study.

    About JD Power
    JD Power is a global leader in consumer insights, advisory services and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 50 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies.

    JD Power has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto shopping tool can be found at JDPower.com.

    Media Relations Contacts
    Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
    John Roderick; East Coast; 631-584-2200; [email protected]

    About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

     

  • 2023 U.S. Individual Life Insurance & Annuity Studies

    Satisfaction with Life Insurance and Annuity Products Climbs as Customers Embrace Digital, JD Power Finds

    2023-10-11

    jillian.breska

    TROY, Mich.: 12 Oct. 2023 — Could the latest generation of mobile apps and websites hold the keys to solving the decades-old challenge of customer apathy toward life insurance and annuities? According to the JD Power 2023 U.S. Individual Life Insurance StudySM and the JD Power 2023 U.S. Individual Annuity Study,SM both released today, customer satisfaction is climbing as more customers make use of digital tools and start using life insurance and annuities for financial planning in addition to final planning (e.g., death benefits, burial insurance).

    “Sales of life insurance enjoyed a brief surge in popularity during the height of the pandemic, while sales of annuities have more recently soared,” said Breanne Armstrong, director of insurance intelligence at JD Power. “But outside of that, customer satisfaction and engagement have generally declined the longer customers hold onto these products. Now, however, with more customers than ever engaging with life insurance and annuity providers more frequently via digital channels, we’re starting to see a real evolution. Customers who interact with the digital offerings of their providers are more engaged, have higher levels of satisfaction and are more likely to incorporate their life insurance and annuity products into their overall financial plans.”

    Following are some key findings of the 2023 studies:

    • Increased digital interaction drives life insurance satisfaction and engagement: The number of customers buying life insurance policies via insurer websites has doubled during the past five years, now accounting for 13% of all life insurance purchases, up from just 6% in 2019. All told, 62% of life insurance customers now interact with their insurer via digital channels. Overall satisfaction is 823 (on a 1,000-point scale) when customers use digital channels, which is 79 points higher than when customers do not interact via digital.
    • Life insurance increasingly being treated as financial planning tool: The proportion of life insurance customers purchasing their policies for both financial and final planning reasons has increased to 39% in 2023 from 30% in 2022. Overall customer satisfaction with life insurance policies is significantly higher when they are purchased for both reasons, as opposed to final planning or financial planning alone.
    • Annuity customer experience moves to digital: Customer satisfaction with annuity products is 800 this year, a significant 11-point increase from 2022, also driven in large part by increased digital engagement. Overall satisfaction levels are highest when annuities are purchased via provider websites. Customer satisfaction with the application and orientation process—which is a critical part of the annuity onboarding process—is highest when customers purchase via provider websites.
    • Consistent digital touchpoints build annuity customer engagement: Nearly three-fourths (72%) of annuity customers are now defined as digital customers who regularly interact with their provider via website, email, chat, text or mobile app. Overall satisfaction among digital customers is 35 points higher (819) than among those who have no digital interaction (784) and 93 points higher than among those who have no interaction at all with their provider (726).
    • Role of local agents and financial advisors enhanced by digital interactions: Even for products purchased through agents or advisors, adding in this digital interaction only increases customer satisfaction. When life insurance customers who purchased through an agent or advisor interact only non-digitally, satisfaction is 795. It increases to 821 when digital interactions are added. This trend also is found among annuity customers who purchased their annuity through an agent or advisor, with satisfaction 25 points higher (809) than among those who didn’t have this type of interaction (784). 

    Study Rankings

    State Farm ranks highest among individual life insurance providers for a fourth consecutive year, with a score of 843. Nationwide (840) ranks second and MassMutual (809) ranks third.

    F&G (formerly Fidelity & Guaranty Life) ranks highest among individual annuity providers with a score of 843. MassMutual (827) ranks second and Nationwide (826) ranks third.

    The U.S. Individual Life Insurance Study measures the experiences of customers of the largest individual life insurance companies in the United States. The study measures overall customer satisfaction based on performance in five factors (in alphabetical order): communication; interaction; price; product offerings; and statements. The 2023 study is based on responses from 5,588 individual life insurance customers and was fielded from May through July 2023.

    The U.S. Individual Annuity Study measures the experiences of customers of the largest annuity companies in the United States. Overall customer satisfaction is based on performance in five factors (in alphabetical order): communication; interaction; price; product offerings; and statements. The study is based on responses from 3,579 individual annuity customers and was fielded from May through July 2023.

    For more information about the U.S. Individual Life Insurance Study, visit https://www.jdpower.com/business/healthcare/us-individual-life-insurance-study.

    For more information about the U.S. Individual Annuity Study, visit https://www.jdpower.com/business/insurance/us-annuity-study.

    About JD Power
    JD Power is a global leader in consumer insights, advisory services and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 50 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies.

    JD Power has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto shopping tool can be found at JDPower.com.

    Media Relations Contacts
    Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
    John Roderick; East Coast; 631-584-2200; [email protected]

    About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

     

  • 2023 U.S. Independent Agent Satisfaction Study

    More Independent Insurance Agents are Shopping Premiums, Even as Carrier Satisfaction Remains at an Unprecedented High, JD Power Finds

    2023-09-27

    jillian.breska

    TROY, Mich.: 3 Oct. 2023 — While independent insurance agents continue to be satisfied with their carrier partners, the rising cost of premiums has made these relationships increasingly tenuous. According to the JD Power 2023 U.S. Independent Agent Satisfaction Study,SM released today, overall agent satisfaction with insurers of both personal lines and commercial lines has reached an all-time high, surpassing 2022’s record-setting score.

    Year over year, personal lines satisfaction has achieved a significant 17-point increase (on a 1,000-point scale) and commercial lines a 6-point increase. Still, more agents have been shopping policies ahead of their clients’ renewals and are willing to move policies for a lower price to retain clients, even if an agent is content with the existing carrier.

    The study was developed in conjunction with the Independent Insurance Agents & Brokers of America (IIABA). It evaluates the evolving role of independent agents in P&C insurance distribution, general business outlook, management strategy and overall satisfaction with personal lines and commercial lines insurers in the United States.

    “Carriers are doing a great job of providing quality service to agents and it creates a huge competitive advantage,” said Stephen Crewdson, senior director of insurance business intelligence at JD Power. “Agents are more willing to place business with a carrier when they are more satisfied with their experience. However, the uptick in agents shopping their clients’ policies shows that rising premiums are the ultimate disruptor, threatening to upend even a strong existing relationship. That puts the onus on carriers to find ways to incentivize agents to stay by offering an experience that can justify these cost hikes.”

    Following are key findings of the 2023 study:

    • Agent satisfaction surpasses previous all-time high: Overall satisfaction among personal lines agents is 774, up 17 points from 2022, while overall satisfaction among commercial lines agents is 762, up 6 points from a year ago. The largest gains in satisfaction with commercial lines are in claims process and support and communication, while the largest gains in personal lines are claims process and commission.
    • Rising prices trigger agents to shop policies: Despite rising satisfaction scores, agents are being more aggressive in shopping their clients’ policies with other carriers. More than half of both personal lines (57%) and commercial (52%) lines agents say they are proactively shopping for clients more now than they were two years ago.
    • Service over incentives: When asked why agents place business with a specific insurer, ease of quoting (18% personal and 17% commercial) and risk appetite aligned with agency (13% personal and 15% commercial) are the two most common responses. Underwriting experience is more important for commercial lines (10%) than personal lines (5%). Commission and incentives (6% personal and 5% commercial) are among the least important factors.
    • Strength in numbers—to a degree:  While they operate independently, many agents are part of an agency alliance that ultimately gives them better access to more carriers, better buying access and increased support and communication. To a point, the larger the alliance, the more satisfied agents are with insurers, with one glaring exception: the largest alliances ($50 million+ in revenue) are the least satisfied of all alliance groups (793 for personal lines and 755 for commercial lines) and agents are less satisfied than agents not in an alliance for commercial lines (765).

    Study Rankings

    Auto-Owners Insurance ranks highest among insurers for personal lines, with a score of 839. Erie Insurance (829) ranks second and Progressive (806) ranks third.

    Auto-Owners Insurance ranks highest among insurers of commercial lines for a third consecutive year, with a score of 847. Cincinnati Insurance (809) ranks second and The Hartford (792) ranks third.

    For the 2023 U.S. Independent Agent Satisfaction Study, a survey of P&C insurance independent agents resulted in 4,513 evaluations of personal and commercial lines insurers with which agents had placed policies during the prior 12 months. The study was fielded from May through July 2023.

    For more information about the U.S. Independent Agent Satisfaction Study, visit https://www.jdpower.com/business/insurance/independent-agent-satisfaction-study.

    About JD Power
    JD Power is a global leader in consumer insights, advisory services and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 50 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies.

    JD Power has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto shopping tool can be found at JDPower.com.

    Media Relations Contacts
    Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
    John Roderick; East Coast; 631-584-2200; [email protected]

    About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

     

  • 2023 U.S. Home Insurance Study

    Home Insurer Exodus from Several States Creates Challenges and Opportunities, JD Power Finds

    2023-09-19

    jillian.breska

    TROY, Mich.: 19 Sept. 2023 — Homeowners and renters across the country have been receiving letters from their insurance providers letting them know they are being dropped as a combination of catastrophic events, rising costs and regulatory pressures have strained property and casualty (P&C) insurance business models. According to the JD Power 2023 U.S. Home Insurance Study,SM released today, the phenomenon represents opportunity for the carriers that remain, but comes with a need to understand the potential effect these actions have on customer perceptions.

    “We’ve all seen the headlines about insurers leaving states like California and Florida where catastrophic weather claims have been at an all-time high, but this pattern is playing out nationwide, affecting thousands of homeowners in every state,” said Breanne Armstrong, director of insurance intelligence at JD Power. “Insurers are reworking their actuarial maps, confronting state regulations that cap rate increases and struggling with profitability. For customers, this combination of steadily rising rates and sudden abandonment can create irreparable damage to brand loyalty and perceptions of trust. However, it also creates an opportunity for carriers that can come in and absorb these customers. This could be a real make-or-break moment for many carriers.”

    Following are some key findings of the 2023 study:

    • Overall satisfaction flat as rates start to increase: Overall homeowner satisfaction is 819 (on a 1,000-point scale), which is flat vs. 2022, and renter satisfaction increases one point this year. Average filed rate increases for home insurance have been in the double digits each month since February 2023 and nearly half (48%) of homeowners insurance customers affected by a rate filing received a rate increase of 5% or more in 2022.
    • Statewide pull-outs can negatively affect customer satisfaction and trust: Insurers that absorb new customers in states where other carriers are exiting will have an opportunity to expand their market share but may struggle to immediately build strong levels of trust and customer satisfaction. Overall customer satisfaction with homeowners insurance is highest when customers have a tenure of 8 years or more. Less-tenured homeowners insurance customers are significantly less satisfied with their overall experience, less likely to renew with their existing carrier and less likely to be an advocate of their existing carrier.
    • Price sensitivity drives shopping and limits bundling: A 57% majority of homeowners who switched carriers in the past year did so for a better price. Among those who have switched insurers within the past year, bundling rates declined 10 percentage points. Bundling auto and home policies is also less prevalent in states such as Florida, California and Louisiana, which have been focal points for large-scale carrier exits.

    Study Rankings

    Erie Insurance ranks highest in the homeowners insurance segment, with a score of 856. Amica (844) ranks second and Auto-Owners Insurance (834) ranks third.

    Erie Insurance also ranks highest in the renters insurance segment with a score of 881. American Family (856) ranks second and Lemonade (854) ranks third.

    The U.S. Home Insurance Study examines overall customer satisfaction with two distinct personal insurance product lines: homeowners and renters. Satisfaction in the homeowners and renters insurance segments is measured by examining five factors: interaction; policy offerings; price; billing process and policy information; and claims. The study is based on responses from 11,221 homeowners and renters via online interviews conducted from May through July 2023.

    For more information about the U.S. Home Insurance Study, visit https://www.jdpower.com/business/insurance/us-home-insurance-study.

    About JD Power
    JD Power is a global leader in consumer insights, advisory services and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 50 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies.

    JD Power has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto shopping tool can be found at JDPower.com.

    Media Relations Contacts
    Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
    John Roderick; East Coast; 631-584-2200; [email protected]

    About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

     

  • 2023 U.S. Small Commercial Insurance Study

    Small Business Insurance Customer Satisfaction Defies Steadily Rising Rates to Reach All-Time High in JD Power Study

    2023-08-17

    jillian.breska

    TROY, Mich.: 22 Aug. 2023 — Despite steadily rising interest rates and strained business conditions, U.S. small businesses are increasingly satisfied with the products and services they are receiving from their commercial insurance providers. According to the JD Power 2023 U.S. Small Commercial Insurance Study,SM released today, overall customer satisfaction has reached an all-time high of 847 (on a 1,000-point scale) as customers note significant year-over-year improvement in three of five factors evaluated in the study.

    “Contrary to what we’ve seen in personal lines insurance, small business customer satisfaction keeps rising even as premiums have continued to climb,” said Stephen Crewdson, senior director of global insurance intelligence at JD Power. “While the overall satisfaction numbers are high, there are some important variations based on the size of the small business. The trend is really being driven by businesses in the ranges of five to 10 employees and 11-50 employees, as opposed to the micro businesses with fewer than five employees. That variation should inform more targeted small business strategies on the part of insurers.”

    Following are some key findings of the 2023 study:

    • Customer satisfaction reaches all-time high: Overall small business customer satisfaction with commercial insurers is 847, up 5 points from 2022 and up 70 points from a decade ago. Customer satisfaction improves across all factors in the study and is led by claims, price and interaction.
    • Smallest small businesses feel less satisfied: Although overall customer satisfaction improves across all categories of businesses evaluated in the study, the micro category—which consists of businesses with fewer than five employees—has a lower overall satisfaction score (823) than do medium-size (855) and larger (857) small businesses.
    • Proactive communication takes the sting out of rising premiums: When insurers proactively discuss price changes with small business customers and work with them to find ways to minimize that increase, overall customer satisfaction improves. Among the 36% of customers who made changes to their coverage to minimize a price increase, satisfaction with the price of their policy increases 84 points. And of the 25% of customers who made changes to their business practices to reduce their risk, price satisfaction increases 135 points.
    • Social media plays key role in communicating with small businesses: Small businesses are generally interested in receiving tips for reducing costs, new product information and information on state and federal regulation changes via social media. Overall satisfaction is 88 points higher among micro business customers who follow their insurer on social media than those who do not.

    Study Ranking

    Nationwide ranks highest in overall customer satisfaction with a score of 883. State Farm (877) ranks second and Cincinnati Insurance (870) ranks third.

    The 2023 U.S. Small Commercial Insurance Study is based on responses from 2,472 small commercial insurance customers. The study, now in its 11th year, examines overall customer satisfaction among small commercial insurance customers with 50 or fewer employees. Overall satisfaction is comprised of five factors (in alphabetical order): billing and payment; claims; interaction; policy offerings; and price. The study was fielded from March through June 2023.

    For more information about the U.S. Small Commercial Insurance Study, visit https://www.jdpower.com/business/insurance/us-small-commercial-insurance-satisfaction-study.

    About JD Power
    JD Power is a global leader in consumer insights, advisory services and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 50 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies.

    JD Power has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto shopping tool can be found at JDPower.com.

    Media Relations Contacts
    Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
    John Roderick; East Coast; 631-584-2200; [email protected]

    About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

     

  • 2023 U.S. Auto Insurance Study

    Auto Insurance Customer Satisfaction Plummets as Rates Continue to Surge, JD Power Finds

    2023-06-09

    jillian.breska

    TROY, Mich.: 13 June 2023 — Nearly one-third (31%) of U.S. auto insurance customers say they experienced a rate increase during the past year as the industry raises rates an average of 15.5%1 and insurers continue to fight the forces of record high loss ratios. Auto insurers lost an average of 12 cents on every dollar of premium they collected in 2022—the worst performance in more than 20 years—leaving them few alternatives but to raise rates at the expense of customer satisfaction. According to the JD Power 2023 U.S. Auto Insurance Study,SM released today, satisfaction with auto insurance has dropped 12 points (on a 1,000-point scale) year over year, the largest decline in the past 20 years. The decline is largely driven by lower satisfaction with the price customers pay for insurance, a factor that has declined 25 points this year.

    This phenomenon is driving an increase in adoption of usage-based insurance (UBI) programs, which base the cost of a policy on a driver’s behaviors using telematics data. Customers new to an insurer have a high UBI participation rate of 26%.

    “Overall customer satisfaction with auto insurers has plummeted this year, as insurers and drivers come face to face with the realities of the economy,” said Mark Garrett, director of insurance intelligence at JD Power. “While insurers are caught between a rock and a hard place when it comes to balancing profitability with customer experience, there are several ways they can blunt the negative effects of rising costs, such as proactively offering customers UBI alternatives, clearly signaling and explaining necessary rate increases and consistently delivering on brand promises to instill trust.”

    Following are some key findings of the 2023 study:

    • Surging rates topple customer satisfaction: Auto insurance price increases are three times higher than other categories tracked by the Consumer Price Index (15.5% vs. an average of 4.9%). Overall customer satisfaction with auto insurance providers is 822, down from 834 a year ago. The decline is driven by a 25-point decrease in customer satisfaction with the price of their policies.
    • Price increases were likely more prevalent: More customers likely experienced increases but awareness is affected by the method and frequency of billing and payments. Among those customers who received a bill in the mail and paid in full via credit card, nearly half (45%) said they had a price increase, compared with more than one-fourth (28%) of those who received a digital bill and made automatic recurring installment payments.
    • Not all customers react the same: Some groups of customers had a more negative reaction to price increases, including those who either rent their residence or do not bundle their home and auto insurance; are single car/single driver households; are open to switching insurers; or those who have a lower perception of their insurer being trustworthy.
    • UBI sees record adoption: Participation in usage-based insurance programs has more than doubled since 2016, with 17% of auto insurance customers now participating in such programs. Price satisfaction among customers participating in these programs is 59 points higher on average than among non-participants.
    • As UBI adoption gains, growing pains emerge: While more customers than ever have adopted UBI, the programs are still relatively new. One-third (33%) of customers currently using UBI have been on the program for less than one year. Concerns over accuracy of data collected by UBI technologies has become a pain point, with just 38% of customers indicating that the information collected is “always accurate.”
    • Softening the blow of a price increase:  While price increases are never good for customer satisfaction, notifying customers in advance through their preferred channel (e.g., phone call from their agent) and making the reason for the increase clear as well as discussing any options that may be available, such as UBI, can make a big difference in how they are perceived by customers. The amount of the price increase also affects customer satisfaction, with a 137-point difference in price satisfaction between those experiencing an increase of more than $300 vs. those experiencing an increase of $50 or less.

    The study measures customer satisfaction with auto insurance in 11 geographic regions. Highest-ranking auto insurers and scores, by region, are as follows:

    California: Wawanesa (843) (for a fourth consecutive year)
    Central: Shelter (851) (for a third consecutive year)
    Florida: State Farm (833)
    Mid-Atlantic: Erie Insurance (863) (for a second consecutive year)
    New England: GEICO (836)

    New York: New York Central Mutual (842) (for a second consecutive year)
    North Central: Erie Insurance (844) (for a third consecutive year)
    Northwest: The Hartford (836) (for a second consecutive year)
    Southeast: Farm Bureau Insurance – Tennessee (866) (for a 12th consecutive year)
    Southwest: State Farm (835) (for a second consecutive year)
    Texas: Auto Club of Southern California (AAA) (839)

    Usage Based Insurance (UBI): GEICO (824), Progressive (824) and State Farm (824) in a tie

    The 2023 U.S. Auto Insurance Study, now in its 24th year, examines customer satisfaction in five factors (in alphabetical order): billing process and policy information; claims; interaction; policy offerings; and price. The study is based on responses from 41,437 auto insurance customers and was fielded from January through April 2023. New this year, the study has introduced a national award category for UBI, along with diagnostics that influence UBI participants’ experience with insurers’ usage-based auto products.

    For more information about the U.S. Auto Insurance Study, visit https://www.jdpower.com/business/insurance/auto-insurance-study.

    About JD Power
    JD Power     is a global leader in consumer insights, advisory services and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, JD Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 50 years. The world’s leading businesses across major industries rely on JD Power to guide their customer-facing strategies.

    JD Power has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto shopping tool can be found at JDPower.com.
    Media Relations Contacts
    Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
    John Roderick; East Coast; 631-584-2200; [email protected]

    About JD Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

    1U.S. Bureau of Labor Statistics: CPI April 2023