J.D. Power and Associates Reports: Nearly 20 Percent of Customers Consider Switching Auto Insurance Companies Following Their Most Recent Collision Claim
Amica Mutual Ranks Highest in Customer Satisfaction With the Collision Repair Process
WESTLAKE VILLAGE, Calif., Jan. 9 -- Nearly one out of every five customers considers switching insurance companies after experiencing the collision claim process, according to the J.D. Power and Associates 2006 Collision Repair Satisfaction Study(SM) released today.
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The study examines three factors that drive customer satisfaction with the repair experience. In order of importance, they are: claims/estimation (62%); body shop (36%); and rental car (2%).
"Filing an insurance claim is a critical moment of truth that shapes a customer's overall perception of their insurer," said Jeremy Bowler, senior director of the insurance practice at J.D. Power and Associates. "Often, this is the first time they truly become familiar with their insurance policy. Misconceptions about what is covered by the auto policy, or what to expect during the claim and repair processes can lead to significantly lower customer satisfaction, which in turn increases the likelihood that the customer may consider switching carriers in the future."
The study finds that 7 percent of customers chose not to file a claim with their insurer after their most recent collision. Common reasons include: the insurance deductible was more than the cost of the repairs; concern that the carrier would increase the premium after the claim; or at the advice of their insurance agent.
"Before filing an insurance claim for minor damage, customers may want to first get an estimate for the cost of repairs," said Bowler. "If it's less than the deductible on the policy, the insurer will likely not cover any of the expense anyway."
Additionally, while more than 30 percent of auto insurance customers who chose not to file a claim after a collision feared their premium would increase, 62 percent of respondent who did file a claim more than six months prior to being surveyed indicate their premium has not been re-adjusted by their insurer.
With a score of 821 index points on a 1,000-point scale, Amica Mutual ranks highest in satisfying claimants with the collision repair process, receiving the highest ratings from customers in the claims/estimation factor. Erie Insurance and State Farm, respectively, follow Amica Mutual in the overall ranking. USAA, an insurance provider open only to the U.S. military community and their families and therefore not included in the rankings, also achieves a high level of customer satisfaction.
The study also finds that claimants whose vehicles are totaled rather than repaired are significantly more satisfied if their insurer gives them a clear explanation of why the vehicle is totaled and how they calculated the settlement amount. Nearly 85 percent of total loss claimants receive an explanation of why their vehicle is being totaled and how their actual cash value settlement is derived.
"The difference in satisfaction is primarily driven by how well the insurer manages the claims process, which is significantly longer for claimants experiencing a total loss," said Bowler. "However, when the damage exceeds $5,000, total loss claimants tend to be significantly more satisfied with their collision experience, perhaps due to concerns surrounding repair quality and diminished value of the vehicle."
The 2006 Collision Repair Satisfaction Study is based on responses from 5,752 customers who have had collision damage repaired on their vehicle or have had a total loss within the past 12 months.
Collision Repair Satisfaction Ranking
(Based on a 1,000-point scale)
Amica Mutual 821
Erie 809
State Farm 800
MetLife 787
ACSC 779
Industry Average 777
CSAA 776
Liberty Mutual 773
AAA Michigan Auto Club Group (ACG) 772
The Hartford 766
Nationwide 765
GEICO 765
St. Paul Travelers 753
Allstate 752
Progressive 751
Farmers 736
American Family 732
Safeco 731
21st Century 731
AIG 705
Mercury 703
**USAA 846
**Note: USAA is an insurance provider open only to the U.S. military
community and their families and therefore is not included in the
rankings.
Included in the study but not ranked due to small sample size, are:
Allied, Encompass and GMAC.
About J.D. Power and Associates
Headquartered in Westlake Village, Calif., J.D. Power and Associates is an ISO 9001-registered global marketing information services firm operating in key business sectors including market research, forecasting, consulting, training and customer satisfaction. The firm's quality and satisfaction measurements are based on responses from millions of consumers annually. J.D. Power and Associates is a business unit of The McGraw-Hill Companies.
About The McGraw-Hill Companies
Founded in 1888, The McGraw-Hill Companies is a leading global information services provider meeting worldwide needs in the financial services, education and business information markets through leading brands including Standard & Poor's, McGraw-Hill Education, BusinessWeek and J.D. Power and Associates. The Corporation has more than 280 offices in 40 countries. Sales in 2005 were $6.0 billion. Additional information is available at www.mcgraw-hill.com.
J.D. Power and Associates Media Relations Contacts: John Tews Syvetril Perryman Troy, Mich. Westlake Village, Calif. (248) 312-4119 (805) 418-8103 john.tews@jdpa.com syvetril.perryman@jdpa.com
No advertising or other promotional use can be made of the information in this release without the express prior written consent of J.D. Power and Associates. www.jdpower.com/corporate
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