Auto Insurance Prices and Policy Offerings Result in Drop in Customer Satisfaction

auto insurance customer satisfaction

Auto insurance customers are less than pleased with their insurers in 2013, according to a new study released by J.D. Power and Associates. The information services firm revealed that rising insurance prices and unhappiness with policy offerings has resulted in a decline in customer satisfaction.

Auto Insurance Customer Satisfaction Declines

After experiencing an all-time high in customer satisfaction just one year ago, the insurance industry may have to make some changes to increase satisfaction this year, according to the J.D. Power 2013 U.S. Auto Insurance Study, released today.

The study revealed that overall satisfaction with auto insurance companies is 794 (on a 1,000-point scale), which is a 10-point drop from 2012.

Satisfaction is measured across five factors: interaction, price, policy offerings, billing and payment and claims. While satisfaction scores across all five factors decreased year over year, J.D. Power found that insurance prices and policy offerings suffered the most with both factors declining by 13 points.

Even more striking is that the study found there is a direct relationship between the size of a premium increase and the proportion of affected customers who switch insurers.

“In 2013, there is a sharp rise in the number of customers who have experienced premium increases,” said Jeremy Bowler, senior director of the global insurance practice at J.D. Power. “The dollar amount of those increases is also larger, averaging $153 in 2013, compared with an average rate increase of $113 reported in the 2012 study.”

J.D Power found when rate increases were $50 or less, only 9 percent of customers switched companies. But when increases were higher than $200, a whopping 32 percent of customers switched insurers.

Finding the Right Insurance Prices and Policy Offerings

If you are a customer who has experienced a change in your insurance prices or policy offerings and are interested in switching insurers, it’s important to take the following steps to make the most informed decision possible:

  • Comparison shop online: One of the best ways to comparison shop for auto insurance is to look for coverage online. You are able to request accurate quotes from insurers and gauge both costs and policy offerings from the comfort of your home.
  • Consider your personal situation: When searching for coverage, consider whether you need liability insurance only or other forms of coverage. Shopping around helps you find the policy offerings you need most then allows you to locate the best cost for those offerings.
  • Explore a company’s reputation: Despite insurance costs and policy offerings being important, neither matter’s if you work with a company that doesn’t settle claims well when you have an accident. So before you make your final decision on a company, be sure to visit review sites as well as your state’s Department of Insurance to learn more about the company’s reputation.

There’s nothing wrong with switching companies after (or even during) a policy term if you’re displeased with aspects of your experience. Just be sure you take every step necessary to purchase coverage you know you’ll be happy with.

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