During service interactions, commercial insurance customers are more satisfied when they interact with both their agent and their insurer, according to “2014 Large Business Commercial Insurance Study,” from global marketing information services firm J.D. Power. As a result, risk managers now are looking for insurers and brokers to jointly meet their needs.
Brokers typically are independent, represent multiple carriers and often are the most-frequent point of contact for customers. However, on a 1,000 point scale, customer satisfaction is higher when insurers are involved during service interactions (865), compared with interactions that are exclusively with the broker (769). The study also finds that there is not a strong relationship between the service interactions that a customer has with their broker and a customer’s overall satisfaction with their insurer.
“Although a broker may interact with risk professionals on a daily basis, risk professionals are able to separate their overall impression of their insurer from their broker interactions, evaluating their insurer independently from their broker,” said Timothy Bebout, director of the commercial insurance practice at J.D. Power. “While it is critical, as a brokerage provider, that you are providing high levels of service and including insurers on a frequent basis, it is clear that the risk professionals expect insurers to elevate their participation as more of a partnership than managed service provider.”
The study measures the overall satisfaction of large-business insurance risk professionals in the United States and Canada and highlights best practices for satisfying customers. The study measures five factors: interaction; program offerings; price; billing and payment and claims for commercial property, workers’ compensation and auto insurers.
Satisfaction with brokers is measured based on four factors: ease of contacting the broker; reasonableness of fees; advice and guidance in selecting program offerings; and timeliness of resolving contact. Satisfaction with brokers averaged 854, and the performance ranged 48 index points between the highest- and lowest-scoring brokers, according to the study.
The most important factor in determining satisfaction with a broker was found to be ease of contacting broker, with a score of (888); reasonableness of fees scored lowest with 828. The ability to understand their customers’ business needs was crucial. Satisfaction among the 84 percent of customers who said their broker “completely” understands their needs is 890; satisfaction drops to 662 among the 16 percent who said their broker either “partially” or does “not at all” understand their needs.
By coverage, satisfaction with property insurers was highest (821), followed by auto (811) and workers’ compensation (746). J.D. Power found wide variance in overall satisfaction among the highest- and lowest-performing commercial insurers in each. Among auto, there was a 112-point gap; in workers’ comp, a 96-point gap; and in property, a 107-point gap.
J.D. Power found a strong relationship between satisfaction levels and loyalty and advocacy. Among property insurance customers who are “pleased/delighted,” meaning those with overall-satisfaction scores of 800 or higher, 62 percent said they “definitely will” renew, and 80 percent said they “definitely will” recommend their insurer. However, 22 percent of “indifferent/displeased” customers, those scoring below 800, said they “definitely will” renew and 26 percent say they “definitely will” recommend their insurer.
Satisfaction among the 93 percent of auto insurance customers who did not experience issues during renewal is 742, J.D. Power said.
In workers’ comp, limiting billing errors was found to be crucial to customer satisfaction J.D. Power said. Satisfaction among the 62 percent of customers who had not experienced a billing error averages 807, compared with 518 among those who had one or more billing errors, a 289 point difference.
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