Are insurers putting cost-saving above customer satisfaction?
Homeowners who have claimed on their property insurance are less satisfied than they have been in the last five years. That’s the finding of a survey by J.D. Power which suggests that insurers may “be shifting their focus away from customer satisfaction and toward areas of cost reduction.”
The study, measured on a 1,000-point scale, saw the satisfaction index drop by 5 points since last year to 846 with the largest changes are in the service interaction factor (- 8 points), driven by declines in both the local agent (-8) and claims professional (-28) sub factors.
Other findings of the study are that 81 per cent of those who were highly satisfied with their claims will renew their policy and the same percentage will recommend their current insurer. Among those who were not satisfied 40 per cent say they will shop for a new deal in the next 12 months while 13 per cent have switched already.
Among individual insurers in the US, Amica Mutual ranks highest for satisfaction followed by Auto Club of Southern California Insurance Group, COUNTRY Financial, Encompass and Erie Insurance.
Google still seen as a threat by insurers
While Google may have pulled out of the insurance comparison market for now, a survey of insurers still shows concern over the internet giant’s future involvement in the market. The World Insurance Market Report from consultants Capgemini shows that more than 40 per cent of insurers believe that Google poses a threat to their business, with Amazon and Wal Mart also in focus.
The report also shows that there is an urgent need for the insurance industry to embrace new technologies or risk being usurped by FinTech start-ups. Generation Y is driving demand for a more tech-focused industry with expectations of a positive digital experience higher among this group than other demographics, although a quarter of all consumers say they plan to purchase their insurance through a digital channel in the next 12 months.
Canadian firefighters may pass on costs to insurers
Businesses and homeowners in Kingsville in Ontario may be the first in their county to be charged by firefighters for responding to incidents at their properties. The Windsor Star reports that the council is considering the move which would bring responses to fires in line with the province’s charges for car crashes. Property owners would be billed for the service which they would then seek to reclaim from insurers.
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Insurance Bureau of Canada is concerned that owners may be deterred from calling firefighters and attempt to tackle blazes themselves in order avoid costs: “People may not have property insurance,” Pete Karageorgos, director of consumer and industry relations told the Windsor Star, “If residents think a bill will follow a call to the fire department, they might think twice about making that call.”
