The Time it Takes to 'Get Things Right' Considerably Impacts Auto and Homeowners Insurance Claim Customer Satisfaction
WESTLAKE VILLAGE, Calif., Dec. 18, 2007 -- When filing an insurance claim, the time it takes to repair the damage has a major impact on homeowner and auto insurance customer satisfaction, according to the J.D. Power and Associates 2007 Insurance Claims Study(SM) released today.
The inaugural study measures auto and homeowner insurance customer satisfaction with the claims process by examining several key factors. Depending upon the complexity of a claim, the customer may experience all or only some of the following factors: claims settlement, claim servicing, first notice of loss, estimation process, repair process, and rental experience.
The study finds that among the two-thirds of customers whose vehicles are fixed and returned within 14 days, satisfaction averages 843 on a 1,000-point scale. However, satisfaction with the claims process declines by 71 points among the 36 percent of customers who must wait longer than two weeks for their vehicle to be repaired. Overall satisfaction among homeowner insurance customers is similarly impacted when repairs take longer than initially anticipated.
"It becomes extremely important to manage customer expectations as far as how long it will take for their vehicle or property to be repaired or replaced," said Jeremy Bowler, senior director of the insurance practice at J.D. Power and Associates. "Proactively contacting the customer, keeping them informed and explaining the process at each step can soften the impact of a particularly long claim process -- enhancing customer confidence and satisfaction with their insurer."
In addition to repair times, the number of people a customer interacts with throughout the claims process can also significantly impact satisfaction. While nearly 75 percent of customers with an agent contacted their local agency first, more than one-third of these customers were either redirected to call the insurer or transferred to a call center. Customers who are redirected tend to be much less satisfied with the claims experience.
"As the number of representatives a customer interacts with increases, so does the likelihood that the customer will need to repeat information regarding the claim, which negatively impacts their overall impression of their insurer and adds to the amount of time spent in the claims process," said Bowler. "Customers with a local agent are most likely to be satisfied with claims servicing if they report the incident to the agent and that agent remains as the primary claim contact thereafter."
The study also finds that one in four claimants has out-of-pocket expenses (in addition to their deductible) that are not fully reimbursed. These customers are the least satisfied with the settlement experience. Additionally, 8 percent of all customers filing a claim indicate they had to pay some out of pocket expenses that were later reimbursed by their insurer. Despite being reimbursed, these customers were significantly less satisfied than those who didn't have out of pocket expenses.
The 2007 Insurance Claims Study is based on 10,832 responses from auto and homeowners insurance customers who filed a claim within the past 12 months. The study was fielded from August to September 2007. To view the management discussion based on this year's study findings, please click the following link: http://www.jdpower.com/corporate/library/download/?files=9998886
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, performance improvement, 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.