Customer Satisfaction Lowers Among Total Loss Auto Insurance Claimants

Auto insurance claimants who incur a total loss on their vehicles are less satisfied with their claims experience than claimants who incur a repairable loss, says a new report from J.D. Power and Associates. The major gripe of claimants who are dissatisfied with the process is they don’t receive enough of a settlement to cover the loss of their vehicle.

Total Loss Claimants Dissatisfied with Auto Insurance Process

The new J.D. Power and Associates 2011 U.S. Auto Claims Satisfaction Study(SM) released today revealed that satisfaction averages 811 on a 1,000-point scale among claimants with a total loss. This is 42 points lower than satisfaction among claimants whose vehicles have been repaired.

Among total loss claimants surveyed, approximately 50 percent cited the settlement they received wasn’t enough to replace their totaled car with a similar make/model vehicle. Additionally, the claims process takes longer on average with total loss claims taking 18.2 days to receive payment, compared with just 12.5 days for the return of a repaired vehicle.

The auto insurance companies that had the lowest scores for satisfaction include 21st Century (771), Commerce (772), Encompass (789), Esurance (800) and Farmers (804). Companies with top ratings are Auto-Owners Insurance (890), State Farm (878), Amica Mutual (865), American Family (862) and The Hartford (858).

Improving the Total Loss Process for Claimants

Discrepancies among how total loss and vehicle repair claimants are treated is making total loss claimants feel slighted in the process. J.D. Power and Associates, however, states a few adjustments from auto insurance companies could increase satisfaction ratings:

  • Communication: Insurers must be available when claimants have questions, make an effort to clearly explain the claims process and follow up in a timely manner.
  • Speed: Insurers must move faster through the claims process, from first notice of total loss to appraisal, as well as communicating the settlement and ultimately paying the claimants.
  • Fairness: Customers want to be treated fairly regarding their settlement while avoiding surprises during the process. Reducing unexpected out-of-pocket expenses and helping them understand what their policy covers in a claims situation can help increase feelings of fairness.

Jeremy Bowler, senior director of the auto insurance practice at J.D. Power and Associates, provided some additional tips for customers during the claims process:

  • Request a printed report detailing your settlement: You want to ensure the vehicle specifications your auto insurance company uses are correct and factor in vehicle upgrades, the condition of your vehicle prior to the accident and any after-market accessories.
  • Check data for comparable vehicles: It’s important to make sure that comparable vehicles used to determine the value of your vehicle are indeed similar.
  • Question the adjuster: It’s good to ask the adjuster to look at your vehicle in person if you received a desk settlement that you believe is inaccurate.

Understanding auto insurance claims is important in improving the total loss settlement process. By taking time to discover the ins and outs of what your policy covers, as well as researching company claims process reviews prior to switching companies could help make the process smooth in the future.