WESTLAKE VILLAGE, CA --- Auto insurance customers were significantly more satisfied with the claims process in 2009, compared with 2008, according to the J.D. Power and Associates 2009 Auto Claims Satisfaction Study released last month.
The study found that overall satisfaction among auto insurance claimants averaged 842 on a 1,000-point scale, an increase of 24 points from 2008. This improvement was driven in part by greater satisfaction with settlement of the claim, with claimants more satisfied with the time it took to settle the claim and the fairness of the claim settlement in 2009. In addition, cycle time decreased to 12.6 days in 2009 from 14.8 days in 2008.
"The current economic situation appears to be having a positive effect on the auto claims experience," said Jeremy Bowler, senior director of the insurance practice at J.D. Power and Associates. "The rate of road accidents is generally down, and consequently, fewer customers are filing claims and getting their vehicles repaired. As a result, repair facilities have a lower volume of work, which has considerably shortened the time it takes to schedule and start repairs, all of which contribute to the two-day shortening of claim cycle time."
In fact, 96 percent of claimants reported they received a repair appointment at their desired date and time, which has a significant impact on satisfaction, Bowler noted.
Higher levels of customer satisfaction may benefit an insurer's bottom line, as more satisfied customers were considerably more likely to both renew with their insurer and recommend their insurer to others, compared with less satisfied customers. For example, among customers whose insurers achieved high levels of satisfaction (scores of 858 or higher), 65 percent said they "definitely will" renew with their insurer, while only 43 percent of customers whose insurers had low satisfaction levels (scores of 818 or lower) said the same.
In addition, 57 percent of customers whose insurers achieved high levels of satisfaction said they "definitely will" recommend their insurer to others, compared with only 35 percent of customers whose insurers had low satisfaction levels.
The study also found that claimant expectations and satisfaction vary considerably across the six different repair claim paths they may experience, depending on who they deal with at various points in the process. For example, satisfaction tends to be higher among customers whose claims experience involves reporting their claim to their local agent, rather than directly to the insurer. Despite differences in the various paths, simply following up with the claimant at the end of the claims process may provide a substantial lift in satisfaction across all experiences.
"While insurance providers often have their own unique strategy to handle claims, it's important that providers focus on optimizing the process to improve satisfaction," said Bowler. "Some claimants may have only one contact point with the insurance provider throughout the entire process, making that one contact even more crucial in determining the customer's overall satisfaction with the claims experience."
The study measured claimant satisfaction with the claims process for an auto physical damage loss. Depending upon the complexity of a claim, the customer may experience all or only some of the following factors: first notice of loss, service interaction, appraisal, repair process, rental experience and claim settlement.
With a score of 883, Auto-Owners ranked highest in providing a satisfying claims experience for auto insurance customers for a second consecutive year. Auto-Owners performed particularly well in the first notice of loss, service interaction and claim settlement factors. GMAC followed Auto-Owners in the rankings with a score of 871, and The Hartford ranked third with a score of 870. USAA, which is open only to U.S. military personnel and their families, and therefore is not included in the rankings, also achieved a high level of customer satisfaction.
The 2009 Auto Claims Satisfaction Study is based on 11,616 responses from auto insurance customers who filed a claim within the past 12 months with their current auto insurance provider. The study excluded customers who only had glass/windshield damage and theft/stolen vehicle, or only roadside assistance claims. The study was fielded from June to July 2009.