Amica Mutual Ranks Highest in Homeowners Insurance Customer Satisfaction for 15th Consecutive Year;

The Hartford Ranks Highest in Renters Insurance Customer Satisfaction for First Time

COSTA MESA, Calif., Sept. 19, 2016 /PRNewswire/ — With homeowners and renters insurance premiums remaining stable, insurers are focusing on the customer experience to differentiate themselves from the competition, according to the J.D. Power 2016 U.S. Home Insurance Study,SM released today.

Historically, price has been the leading basis of competition for many insurers. The industry is currently in what could best be described as a stagnant or soft cycle, with rates remaining relatively stable. On average, customers report an annual premium charge of $1,186 for homeowners insurance and $259 for renters insurance in 2016, with both remaining relatively unchanged over the past few years.

“Insurers have shifted their competitive focus to improving communication, process efficiency, and being easier to work with as a way to solidify and grow their business,” said Valerie Monet, director of the insurance practice at J.D. Power. “Improvements in processes and customer service benefit everyone—the customer and the insurer. When competing on price, it’s incredibly difficult to provide an outstanding customer experience.”

The shift in insurers’ strategic priorities has resulted in a significant increase in satisfaction. Overall customer satisfaction with homeowners insurers is 804 (on a 1,000-point scale) and overall customer satisfaction with renters insurance companies is 825, each a 17-point increase from 2015. Monet noted that while in the homeowners and renters segments satisfaction with price is up (+16 points) because rates are stable, the increase in satisfaction with policy offerings (+25) is actually a much larger driver of the overall annual change in satisfaction. Improved communication is helping customers to see the value in the products they purchase. Among homeowners customers, satisfaction also improves significantly in claims (+19 points) and interaction (+10).1

“By pleasing their current customers, which builds loyalty and advocacy, insurers benefit financially,” said Monet. “Customers don’t often just pocket the savings that result from stable premiums. If they are happy with their current insurer, they will frequently modify their policy by increasing their coverage or purchasing additional insurance with the savings, such as adding riders for high-priced items like jewelry, artwork and family heirlooms.”

The Young and the Wealthy
Gen Y2—now the largest generation in the United States at 75 million or 31% of the population3 and the largest group of home buyers at 35%4—is a sizable force in the U.S. economy today. Over the next decade, Gen Y will become even more influential as they enter their prime years of building assets and accumulating wealth, and, therefore, will likely represent a lucrative segment for insurers to target.

“These young, affluent consumers create an opportunity for insurers looking to grow their business,” said Monet. “Gen Y, across all of its income levels, has the greatest affinity for using technology in all aspects of their lives, given they grew up using technology 24/7. Combining this with the fact that HNWIs typically have more complex risk and insurance needs than the average policyholder suggests it is important for insurers to understand how to meet the needs of HNWI Gen Y customers and modify their approach accordingly.”

While HNWI Gen Y customers are more satisfied overall with their homeowners insurance than are HNWI Boomers, they are less satisfied with interaction with their insurer, specifically with their agent experience. HNWI Gen Y has a greater number of contacts with their insurer vs. HNWI Boomers, resulting in the interaction factor having a heavier weight in the overall satisfaction index among HNWI Gen Y vs. Boomers (34% vs. 27%, respectively). Focusing on improving agent and broker interactions will be critical for insurers looking to attract and retain HNWI Gen Y customers.

“Although many insurers have made great strides in improving the customer experience, there is still significant opportunity to improve customer perceptions of both products and services,” said Monet. “New entrants into the market, such as on-demand insurance, will likely result in shifts in customer expectations. Customer satisfaction is going to be more important than ever before for competitive position and growth.”

On-demand insurance allows customers to insure items just when they need it, turning it on and off, frequently using their smartphone. Often called “just-in-time coverage,” consumers can insure, for example, their bike only while they’re riding it, their skis during a weekend trip or their laptop when used away from the home.

“On-demand insurance is gaining popularity in markets outside the United States and is slowly growing in the United States,” said Monet. “It’s important that insurers know which segments of their customers would be interested in such insurance products and perhaps develop a similar product to compete in that space.”

The 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. Satisfaction is calculated on a 1,000-point scale.

Insurance Rankings
Amica Mutual ranks highest in the homeowners insurance segment for a 15th consecutive year, with a score of 864. Amica Mutual performs particularly well in the billing process and policy information, interaction, policy offerings and price factors. Auto Club of Southern California Insurance Group ranks second (835), followed by Cincinnati Insurance (828), GEICO (826) and Auto-Owners Insurance (824).

The Hartford ranks highest in the renters insurance segment with a score of 841. The Hartford performs particularly well in the billing process and policy information, interaction and policy offerings factors. American Family ranks second (836), followed by Erie Insurance (834) and State Farm (832).

Overall Satisfaction Rankings – Homeowners Insurance

Overall Customer Satisfaction Index Scores

J.D. Power.com Power Circle Ratings

(Based on a 1,000-point scale) 

For Consumers

Amica Mutual

864

5

Auto Club of Southern California Insurance Group

835

4

Cincinnati Insurance

828

4

GEICO

826

4

Auto-Owners Insurance

824

4

Erie Insurance

819

4

State Farm

818

3

American Family

817

3

Progressive

817

3

Chubb

816

3

Shelter Insurance

815

3

Allstate

812

3

Encompass

811

3

The Hartford

811

3

Auto Club Group

807

3

COUNTRY Financial

807

3

Farmers

807

3

CSAA Insurance Group

805

3

Homeowners Insurance Average

804

3

Nationwide

802

3

MetLife

801

3

Liberty Mutual

799

3

MAPFRE Insurance

796

3

Travelers

780

3

Mercury

779

3

Safeco Insurance

777

3

American Strategic Insurance

776

3

The Hanover

728

2

Universal P&C

716

2

USAA*

892

 

*USAA is an insurance provider open only to U.S. military personnel and their families, and therefore is not included in the rankings. Included in the study but not award-eligible due to localized availability and/or not meeting minimum sample requirements are Fireman’s Fund, Homesite, State Auto, and Farm Bureau Insurance – Tennessee.

Overall Satisfaction Rankings – Renters Insurance

Overall Customer Satisfaction Index Scores 

J.D. Power.com Power Circle Ratings

(Based on a 1,000-point scale) 

For Consumers

The Hartford

841

5

American Family

836

5

Erie Insurance

834

4

State Farm

832

4

Allstate

829

3

Progressive

825

3

Renters Insurance Average

825

3

Auto Club of Southern California Insurance Group

821

3

GEICO

820

3

Nationwide

817

3

Farmers

815

3

MetLife

815

3

CSAA Insurance Group

812

2

Liberty Mutual

812

2

Safeco Insurance

801

2

Travelers

788

2

USAA*

898

 

*USAA is an insurance provider open only to U.S. military personnel and their families, and therefore is not included in the rankings. Included in the study but not award-eligible due to not meeting minimum sample requirements are Amica Mutual and Automobile Club Group.

Power Circle Ratings Legend
5 – Among the best
4 – Better than most
3 – About average
2 – The rest

Award-Eligible Home Insurance Companies Included in the Study

Company Name

Executive Name

Company Location

Auto Club Group

Joseph Robinson

Dearborn, Mich.

Auto Club of Southern California Inurance Group

Robert T. Bouttier

Los Angeles, Calif.

Allstate

Thomas Wilson II

Northbrook, Ill.

American Family

Jack Salzwedel

Madison, Wis.

American Strategic Insurance

John Auer

St. Petersburg Fla.

Amica Mutual

Robert DiMuccio

Lincoln, R.I.

Auto-Owners Insurance

Jeffrey Harrold

Lansing, Mich.

Chubb

Evan Greenberg

Warren, N.J.

Cincinnati Insurance

Steven J. Johnston

Fairfield, Ohio

COUNTRY Financial

Kurt Bock

Bloomington, Ill.

CSAA Insurance Group

Tim Condon

Walnut Creek, Calif.

Encompass

Thomas Wilson II

Northbrook, Ill.

Erie Insurance

Timothy NeCastro

Erie, Penn.

Farmers

Jeffrey Dailey

Woodland Hills, Calif.

GEICO

Olza Nicely

Washington, D.C.

Liberty Mutual

David Long

Boston, Mass.

MAPFRE Insurance

Jaime Tamayo

Webster, Mass.

Mercury

Gabriel Tirador

Los Angeles, Calif.

MetLife

Steven Kandarian

New York, N.Y.

Nationwide

Stephen Rasmussen

Columbus, Ohio

Progressive

Tricia Griffith

Mayfield Village, Ohio

Safeco

David Long

Boston, Mass.

Shelter Insurance

Rick Means

Columbia, Mo.

State Farm

Michael Tipsord

Bloomington, Ill.

The Hanover

Frederick Eppinger Jr.

Worcester, Mass.

The Hartford

Christopher Swift

Hartford, Conn.

Travelers

Allan Schnitzer

New York, N.Y.

Universal P&C

Terry Wentroble

Fort Lauderdale, Fla.

For more information about the 2016 U.S. Home Insurance Study, visit
http://www.jdpower.com/resource/jd-power-us-household-insurance-study.

See the online press release at http://www.jdpower.com/pr-id/2016179.

Media Relations Contacts
John Tews; Troy, Mich.; 248-680-6218; media.relations@jdpa.com
Geno Effler; Costa Mesa, Calif.; 714-621-6224; media.relations@jdpa.com

About J.D. Power and Advertising/Promotional Rules www.jdpower.com/about-us/press-release-info

1 Satisfaction with billing process and policy information cannot be trended due to methodology changes

2 J.D. Power defines generational groups as Pre-Boomers (born before 1946); Boomers (1946 to 1964); Gen X (1965-1976); Gen Y (1977 to 1994); and Gen Z (1995-2004).

3 Source: Pew Research Center.

4 Source: 2016 National Association of Realtors Home Buyer and Seller Generational Trends

 

 

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