Customer satisfaction with auto insurers continues to rise: J.D. Power study

Customers are happier in spite of higher premiums suggesting great service is key to high marks, says director at J.D. Power

Comprehension of auto insurance policies translates directly to price satisfaction, says J.D. Power’s annual Canadian auto insurance satisfaction study.

Canadians who understand their auto insurance policies while paying a higher premium than their regional average are more likely to be satisfied than those who pay less than average but don’t fully comprehend their policies. As well, for the second year in a row, the survey finds that overall customer satisfaction regarding auto policies increased in Canada despite nationwide rate increases.

“It does seem counterintuitive to see customer satisfaction increase as premiums rise, but customers are content to pay more when they believe they’re getting value for their money,” says Valerie Monet, senior director of the insurance practice at J.D. Power, in a press release.

Reported premiums rose by 17% in Quebec, 16% in the Atlantic region, 11% in Alberta and 1% in Ontario over the past two years. J.D. Power speculates that Ontario saw the smallest premium increase because customers may be benefitting from Ontario’s auto insurance rate reduction strategy to reduce premiums.

Although Canadians are paying more, customer service tactics used by insurers have increased satisfaction once again. “While low prices can be effective at getting new customers in the door, those customers are ultimately willing to pay higher premiums for exceptional service,” Monet says. “Key performance metrics, such as making sure customers understand their policies and providing follow-up calls from customer service interactions, translate into higher satisfaction—regardless of an above-average premium.”

High customer satisfaction led to a first-place standing in the survey for The Co-operators, which maintained its top spot in Alberta, Ontario and Atlantic Canada. The company has held that lead position for two consecutive years or more in all regions. The remaining surveyed region of Quebec sees Industrial Alliance in first place.

J.D. Power’s annual Canadian auto insurance satisfaction study measures customer satisfaction with primary auto insurers in the following areas: non- claim interaction; price; policy offerings; billing and payment; and claims. Insurers are ranked in Alberta, Atlantic, Ontario and Quebec.

The study is based on responses from nearly 11,000 auto insurance policyholders and data was collected in February and March. More information from the survey can be found on J.D. Power’s website.





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