Consumers More Satisfied with Auto Insurance Claims Process

Satisfaction with how car insurers handle claims has risen industry-wide thanks to increases in policyholder satisfaction with settlement amounts and with the initial claims reporting process, according to a recent report from J.D. Power and Associates.

Claims satisfaction overall shows a three-point increase from 852 in the firm’s last report, released in July, to 855 in the latest report, released Wednesday. The latest report was based on survey data collected between December 2012 and September this year.

The regularly published study of how satisfied policyholders are with their insurers’ claims process rates overall satisfaction in six categories:

  • Settlement
  • First notice of loss (FNOL)
  • Service interaction
  • Appraisal
  • Repair process
  • Rental experience

Auto Club of Southern California scored the highest in the rankings, with 10 insurers scoring above the industry-wide average score in overall satisfaction of 855:

Company Overall satisfaction score
Auto Club of Southern California 889
Auto-Owners 874
The Hartford 873
Erie 872
Amica Mutual 871
Travelers 871
State Farm 870
American Family 867
Nationwide 867
The Hanover 862

 

The firm said that insurers saw an increase in satisfaction with FNOL because they did better “in explaining the policy coverage and the claims process to claimants.”

In addition, settlement satisfaction was boosted because more policyholders are getting their claims paid within eight days of starting the initial claims process: 51 percent in the latest report versus 45 percent in all of last year.

“Claims handling is an area where  insurers can make a big impact on customer satisfaction in a relatively short period of time,” Jeremy Bowler, senior director of the global insurance practice at J.D. Power, said in a statement.

Auto Club is ‘Among the Best’ in Settlement, First Notice of Loss

Auto Club was the only company, aside from New Jersey Manufacturers (NJM) and United Services Automobile Association (USAA), to be rated “among the best” in “first notice of loss” and “settlement.”

USAA and NJM were not ranked with other companies because they serve policies to specialized groups. NJM provides policies to New Jersey’s municipal employees and members of the New Jersey Business & Industry Association, while USAA serves military service members and their families.

Both companies scored “among the best” in each of the six categories, as well as in “overall satisfaction.” If included in the rankings, both USAA and NJM would have bested all other companies with scores of 914 and 895, respectively.

According to Bowler, Auto Club has been part of a wave of insurers that “have developed a customer-centric focus on the claims process” and led to boosts in overall satisfaction scores.

Auto Club’s latest overall claims satisfaction score of 889 is a 15-point increase from 2012 and a 65-point increase from 2011.

Several Insurers Were ‘Better Than Most’

However, seven auto insurers were rated “better than most” in the quality of their initial claims reporting process:

  • American Family
  • Amica Mutual
  • Auto Owners
  • Erie
  • The Hartford
  • Nationwide
  • Travelers

Each of those seven companies also ended up scoring above the overall point average for the industry.

Insurers’ settlement scores have always been a prime indicator of an insurer’s overall score; eight insurers were rated “better than most” in the “fairness of the claim settlement” that they ultimately offered a policyholder.

The listing is identical to the listing of those rated “better than most” in the FNOL category, except for State Farm, which scored a higher-than-average overall rated of 870 but was rated “about average” in how it handled policyholders’ initial claim reports.

About Charles Nguyen
Charles Nguyen is an enterprising journalist who reported for Patch.com and the Desert Dispatch and was the editor in chief of the Guardian (the twice-weekly newspaper at the University of California, San Diego) before coming to Online Auto Insurance News.

No comments yet.

Comment on this article