Regional home insurers see 10-point drop in claims satisfaction in West: J.D. Power

Despite drop, overall customer satisfaction increased by 37 points

Smaller, regional home insurers in Western Canada saw an overall regional customer satisfaction decline of 10 points due to the volume of major claims associated with natural disasters like the Fort McMurray wildfires.

Despite the drop in regional claims satisfaction, says the J.D. Power 2017 Canadian Home Insurance Study, overall customer satisfaction with national home insurance carriers in Canada increased by 37 points on a 1,000-point scale. Regional home insurers normally outperform larger, national carriers, but the study says smaller companies likely experienced capacity constraints due to the influx of claims from natural disasters.

“Catastrophic claims on the scale of what we’ve been seeing over the past few years in Western Canada, and over the past several weeks in Quebec, have put a tremendous strain on insurance carrier resources, affecting everything from longer than average claim payment cycles to customers experiencing greater annual premium increases,” says Valerie Monet, director of the insurance practice at J.D. Power, in a press release.

The annual study examines customer satisfaction with home insurance companies based on five factors: non-claim interaction, policy offerings, price, billing and payment, and claims.

“Though the immediate effect of these spikes in claims is felt most by regional carriers, some leaders in the industry have found ways to buck that trend by providing truly great customer experiences even in periods of significant operational stress,” says Monet.

Larger insurance companies have boosted satisfaction through improving non-claims interactions through websites, local agents or brokers and customer service representatives, says the study.

J.D. Power anticipates customer satisfaction in Quebec may take a hit regarding flood coverage. Nearly half (48%) of respondents in Quebec say they have overland flood coverage but the Insurance Bureau of Canada estimates only 10-15% of Canadian homeowners are actually covered.

The Co-operators had the highest overall home insurance customer satisfaction in the Atlantic region and Ontario; RSA Insurance ranked highest in Quebec; and Portage Mutual Insurance took top spot in the west.

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