Customer satisfaction among small businesses insurers has dropped 15 points in the last two years, according to the J.D. Power
The cause of the decline is likely because of a lack of proactive support, related to the COVID-19 pandemic, and personalized attention, according to the study. The survey is based on responses from 1,994 small commercial insurance customers and examines overall customer satisfaction in customers with 50 or fewer employees. The study was conducted from March to June.
“We see a real pattern of small business insurers missing the mark on soft skills, such as interaction with agents and proactive outreach—both being areas in which commercial insurers have historically thrived,” said Robert M. Lajdziak, senior consultant of insurance intelligence at J.D. Power, said in a statement.
Customer satisfaction was down 7 points from a year ago and 8 points from the previous year, for a total of 15 in the last two years. These are the only declines cited in the study’s history. Satisfaction with interactions was also down by 20 points from a year ago.
“Interaction declined the most this year,” Lajdziak told Digital Insurance. “Last year, one of the big things we saw was how impactful proactive communication was for brands, in respect to the pandemic. This year, while there was a positive impact, it seemed to be too little too late.”
Typically, a larger business is able to use digital tools and get personal attention from insurers but the smallest businesses, with fewer than five employees, are being left behind with no contact, Lajdziak said.
“Customers are looking for more channels and better alignment of different activities based on their preferred channels,” Lajdziak said. “Brands and insurers need to have these multiple channels and make sure customers know how to use them and what capabilities are available, so a customer can self-select. Customers are good at selecting the channel that suits their needs.”
Allstate, State Farm and Erie Insurance ranked the highest in overall customer satisfaction, above the industry average of 829 on a 1,000 point scale.
Other findings in the study include the following:
- Customer efforts to interact with agents were significantly higher in 2021. Customers who said they had to exert a great deal of effort to interact with an agent was 32%, last year it was 10%. Digital interaction efforts also increased to 34% from 10%, year over year.
- In 2020, only 19% of customers said their insurers proactively reached out to discuss business needs. However, in 2021 proactive contact went up to 45% but the study suggests that those efforts may be too late for customers.
- More customers, 46%, suggested there were billing and other problems in 2021, up 20 points from 2020.
