Toronto, Ontario -- July 17, 2014 -- Customer satisfaction with claims increases by a significant 11 points, driven by substantially improved interactions, according to the J.D. Power 2014 Canadian Auto Claims Satisfaction Study.
Now in its second year, the study measures customer satisfaction with the claims process for auto physical damage loss. Depending on the complexity of the claim, claimants may experience some or all of the following factors that drive overall satisfaction: first notice of loss; service interaction; appraisal; repair process; rental experience; and settlement.
The insurance industry as a whole is communicating more effectively with claimants throughout the process, which has a positive impact on satisfaction. Year over year, the industry has significantly improved in putting claimants at ease after they report the claim (up by 4 percentage points to 61 percent) and in notifying repair facilities about the claim at first notice of loss (up by 6 percentage points to 30 percent). Also, the percentage of respondents indicating they receive proactive claim status updates is up 3 percentage points to 53 percent in 2014.
Among the service areas in which insurers should focus their improvement initiatives, the most impactful are:
- Ensuring claimants feel at ease after first notifying their insurer of the loss
- Answering all claimant questions
- Providing callbacks when expected
- Reducing the need for claimants to repeat information
- Proactively reaching out to claimants with status updates about their claim
Providing an outstanding claims experience can also generate high levels of advocacy and retention. The study finds that 75 percent of highly satisfied claimants (satisfaction scores of 900 or higher) say they â€œdefinitely willâ€ renew their policy, and 69 percent say they â€œdefinitely willâ€ recommend their current insurer, while only 11 percent of displeased claimants (scores of 549 or less) say they â€œdefinitely willâ€ renew and only 3 percent say they â€œdefinitely willâ€ recommend.
â€œSince, in large part, the customer experience rests in the hands of a number of third partiesâ€”such as the repair shop, tow operator and rental car companyâ€”this presents a challenge for insurers regarding satisfaction,â€ said Jeremy Bowler, senior director of the insurance practice at J.D. Power. â€œOften customers perceive the quality of the service they receive from the fulfillment partners also reflects on the insurer, and as such, blame the insurer if service fails to meet their expectations.â€
- Overall customer satisfaction with the auto claims experience averages 798 (on a 1,000-point scale), an 11-point increase from 2013.
- On average, the study finds that customers who recently experienced a claim rate their insurer 40 points higher than do customers that have not had this moment of truth and experienced the policy benefits so tangibly (798 vs. 758).
- In 2014, repairable claims account for 83 percent of all claims (19 percent tow and 64 percent non-tow).
- Faster claim settlement times and vehicle return times have contributed to higher satisfaction. Vehicles are returned 1.1 days faster; final payments are received 2.2 days faster; and claimants are being informed of settlement terms 1.6 days faster than in 2013.
- The largest factor increases for repairable-tow claims are in first notice of loss (+40 points) and appraisal (+53 points).
- Post-claim follow-up has also significantly improved, by 7 percentage points, which positively impacts the overall experience among claimants with repairable-tow claims.
- 59 percent of consumers surveyed indicated they perceive a working relationship between their insurer and the shop that performed the repairs on their vehicle.
Insurance Company Results
Among the rank-eligible insurance companies included in the study, Desjardins General Insurance ranks highest in overall claimant satisfaction with an index score of 835, performing particularly well in the first notice of loss and settlement factors.
Following Desjardins General Insurance in the rankings are Intact Insurance (829); The Co-operators (819); and State Farm (813).
The 2014 Canadian Auto Claims Satisfaction Study is based on responses from more than 2,700 auto insurance customers in Canada who settled an auto insurance claim within the past 18 months. The study excludes claimants whose vehicle incurred only glass/windshield damage or was stolen, or who filed a roadside assistance claim only. The study was fielded between January and March 2014.