Auto-Owners Insurance and State Farm Each Rank Highest in Two of 11 Regions
Westlake Village, Calif. (June 23, 2015) – Gen Y customers(1) are the driving force behind an increase in overall auto insurance satisfaction due to improvement across all customer service interaction channels, the largest contributor to the customer experience, according to the J.D. Power 2015 U.S. Auto Insurance StudySM released today.
The study examines customer satisfaction in five factors: interaction; price; policy offerings; billing and payment; and claims. Satisfaction is measured on a 1,000-point scale.
Overall customer satisfaction with their auto insurer has reached an all-time high of 818, an improvement of 8 index points from 2014. Satisfaction among Gen Y customers has increased the most, compared with the other generations – Gen Y: +21 points; Gen X: +6; Boomers +4; and Pre-Boomers: -3.
The interaction factor has the greatest impact on overall customer satisfaction and is also the largest contributor to the year-over-year improvement. Overall interaction satisfaction among Gen Y customers (827) is up by a significant 20 points from 2014.
Customer interaction preferences are changing. Gen Y’s preference to interact exclusively through digital self-service (Web or mobile) has increased to 27 percent in 2015 from 21 percent in 2011. A similar pattern of preference is found in other generational groups (Gen X: 23% vs. 19% in 2011; Boomers: 12% vs. 10%; and Pre-Boomers: 6% vs. 4%). Among the interaction channels, satisfaction with the website experience receives the lowest average score, most notably among Gen Y customers (816, compared with 826 for Gen X, 841 for Boomers and 861 for Pre-Boomers).
“While customers across all generations are able to use online self-service for basic tasks such as making a payment and gathering information about their account, they should also be able to resolve more complex issues online,” said Valerie Monet, director of the insurance practice at J.D. Power. “It is critical for insurers to resolve customers’ service needs entirely on the website. This can drive increased use of the website and can minimize servicing costs, as unresolved issues frequently require a contact to call centers or agents, freeing their time to cultivate new business.”
According to Monet, some activities are better performed through personal interactions. One-fourth (25%) of Gen Y customers indicate they would rather talk to someone in person or over the phone to discuss price changes, and 23 percent indicate they prefer in person or over the phone rather than the website channel when they have questions about their policy coverage. Insurers should focus their in-person resources on high-touch customer calls in which the agent’s expertise is highly valued.
- The incidence of resolving issues entirely via the website has increased for Gen Y to 81 percent (up by 2 percentage points from 2014), with similar rates across generational groups – Gen X 82%; Boomers 81%; and Pre-Boomers 80%. Website satisfaction is 123 points lower among customers who do not resolve their issue completely via the website than among those who do (736 vs. 859, respectively).
- Nearly three-fourths (73%) of Gen Y customers indicate having online access to policy information (+2 percentage points from 2014), compared with 62 percent across the other three generations. The level of awareness of online access to policy information among Gen Y customers (73%) is greater than among customers in the other generational groups (Gen X 68%; Boomers 62%; and Pre-Boomers 54%).
- Nearly nine in 10 (87%) customers overall indicate receiving communications from their insurer via their preferred method – up 2 percentage points from 2014 – compared with 81 percent among Gen Y customers, which is an increase of 5 percentage points.
- Across all generational groups, 49 percent of customers say they “definitely will” recommend their current insurer (the same as in 2014) and 50 percent say they “definitely will” renew their policy (down 1 percentage point from 51% in 2014).
Satisfaction varies regionally from a high of 832 in the Texas region to a low of 801 in the New England region. Eight of the 11 study regions post significant increases in overall customer satisfaction year over year, with the greatest improvements in the Florida (+24 points) and Mid-Atlantic (+16) regions.
- California: Wawanesa (844) ranks highest in the California region. The Hartford ranks second at 840 and Auto Club of Southern California Insurance Group ranks third at 839.
- Central: Auto-Owners Insurance (850) ranks highest in the Central region, followed by Shelter Insurance (846) and State Farm (830).
- Florida: GEICO (836) ranks highest in the Florida region. Progressive (835) and Allstate (832) follow GEICO in the rankings.
- Mid-Atlantic: Erie Insurance (850) ranks highest in the Mid-Atlantic region. The Hartford (835) ranks second and State Farm ranks third (826).
- New England: Amica Mutual (866) ranks highest in the New England region. State Farm (815) ranks second and Allstate (808) third.
- New York: State Farm ranks highest in the New York region (831). GEICO (828) ranks second and Travelers (818) ranks third.
- North Central: Auto-Owners Insurance (834) ranks highest in the North Central region. Nationwide (828) ranks second and COUNTRY Financial and Indiana Farm Bureau (822 each) tie for third.
- Northwest: PEMCO Insurance (837) ranks highest in the Northwest region, followed by State Farm (830) and Farmers (828).
- Southeast: Tennessee Farm Bureau (859) ranks highest in the Southeast region. Alfa Insurance (831) ranks second and Allstate (830) third.
- Southwest: The Hartford and State Farm rank highest in the Southwest region in a tie (830 each). Liberty Mutual (826) ranks third.
- Texas: Texas Farm Bureau Insurance (859) ranks highest in the Texas region. No other insurance company performs above the Texas region average (832).
New Jersey Manufacturers Insurance Company (NJM) and USAA also achieve high levels of customer satisfaction in the study, although they are not included in the rankings due to the closed nature of their respective memberships.
The 2015 U.S. Auto Insurance Study is based on responses from 46,256 auto insurance customers. The survey data was collected in March and April 2015.
J.D. Power 2015 U.S. Auto Insurance Study Results
Power Circle Ratings Legend
- 5 – Among the best
- 4 – Better than most
- 3 – About average
- 2 – The rest
1. J.D. Power defines the generational groups as follows:
- Pre-Boomers (born before 1946);
- Boomers (1946-1964);
- Gen X (1965-1976);
- Gen Y (1977-1994);
- Gen Z (1995-2004).
About J.D. Power
Since 1968, organizations around the world have relied on J.D. Power as a trusted advisor for deep expertise in the industries we serve, advanced research science to drive insights, and a proven success record for driving results.
By analyzing the many aspects of the customer experience, J.D. Power can identify the multiple drivers of that experience, measure and understand the impact of those drivers, and help drive business results by monitoring and improving performance.
Source: J.D. Power