Amica Tops Customer Service Rankings

Claims people at the insurance company that has perhaps the best reputation in the nation for keeping policyholders happy describe careful hiring, speedy service and empathy as the keys to the carrier's success.

They were asked about their formula after their firm–Amica Mutual Insurance Company in Lincoln, R.I.–set an insurance industry record by winning the auto insurer customer satisfaction award from J.D. Power Associates for the seventh straight year.

The midsized personal lines insurer–ranked number 50 in the National Underwriter Top 100, with net premiums of $1.38 billion–is also no slouch in tending to its homeowners policyholders, winning the J.D. Power customer satisfaction award in that line four years in a row.

Despite its relative size, employees and executives the company supplied for interviews projected an attitude that approached small-town neighborliness when it came to handling customers.

“So many companies manage by metrics; the advantage we have at Amica is that the paramount guiding force is making that customer happy,” commented Paul Pyne, superintendent of claims for Amica.

Richard Keene, now a claims supervisor for seven years–who joined the company after retiring as a fire chief–said he initially expressed qualms when offered an adjuster's job, fearful there would be pressure to minimize payments, but “I was assured from day one that was not their approach.”

Mr. Keene related how early in his career at Amica he dealt with a family whose home was destroyed by fire three days before Christmas. All the presents went up in smoke.

His branch manager, Mr. Keene said, immediately suggested that “we go out and replace some of the presents, so they could at least have a Christmas.” He said he obtained a short list of gifts from the insureds, and some of the company service representatives shopped for the presents and wrapped them.

When they were delivered to the family, “we got an incredible reaction. They couldn't believe it,” he said.

Mr. Pyne noted that Amica's average employee has been working for the company for 10 years, which means insureds' claim files are not juggled around between different handlers because of staff turnover.

Amica hires employees who are outgoing and like to work with people, and it does an internal review to see how promptly they contact claimants and send out correspondence; how promptly vehicles are appraised; and how promptly payment is issued.

The company makes speed-of-payment a major priority. Mr. Keene said he has always been told, “When you know there is something to be paid, you pay it right away.”

That attitude is something that has been noticed by outside observers. Naras V. Eechambadi, chief executive of the Quaero Corp. marketing firm, reported on this in the online business magazine Domain-B.com.

After giving a talk on companies that win and lose customer loyalty, and praising his own insurer (Amica), Mr. Eechambadi wrote that an Amica insured in the audience told of an experience after 1992's Hurricane Andrew.

An independent adjuster, thinking the homeowner had a different carrier, told him a report would first have to be filed and there would be a follow up before payment. But when he was told the carrier was Amica, he wrote a check on the spot, explaining: “Amica authorizes me to do that–to minimize hassle at a time like this.”

Eric Ernst, a senior Amica claims supervisor, said that with property claims, “we go over and beyond to make sure we're out there to give them what they need.”

With auto claims, he said, the company tries to see the damaged vehicle within a day, and if needed provides a rental replacement.

Mr. Ernst described how an inside team of desk adjusters backs up those on the road. When word of a total loss fire comes in, a road adjuster is immediately sent to the scene to get the homeowner resettled in a hotel and analyze their needs.

The adjuster then starts evaluating whether a large-scale house estimator is needed, while the in-house team works on obtaining contractors to board up the home or do water extraction. Mr. Ernst said while the onsite adjuster is at work, the in-house team can do the analytical work of matching prices.

Mr. Pyne said Amica personnel “know they are asked to minimize the trouble and inconvenience–that it's not just a claim, it's a person that something bad has happened to, either an accident or they were burned out of their house.”

Additionally, he said, the company makes calls to a certain percentage of insureds and asks how good the service was, explaining: “We use this process to make sure we're on track.”

Amica claims personnel do not simply approve all claims, but when they reject them, they try to apply the same thoughtfulness.

Mr. Pyne provided a letter from one insured who wrote to compliment one of Amica's staff–who actually rejected his claim. The insured's letter noted the claims handler “did not become indignant or go to the standard 'company policy' line of, 'I'll talk to my supervisor,'” and had made him feel she had taken steps to make his case to management. “What a novel approach…”

Mr. Keene reports that Amica is so good at hiring people, they not only treat customers well, but fellow employees as well. “It's a terrific work environment.”

Even noncustomers who have claims against Amica drivers appreciate the company's methods, according to Mr. Keene. “Even folks that get into accidents with our customers–they say, 'I'm switching my insurance over to your company.' It happens almost on a daily basis,” he said.

Amica's efforts haven't hurt its bottom line, either. In 2005, the company's combined ratio was stellar for fire (61.8), private auto liability (97.3) and commercial auto (55).

John Tews, a representative for J.D. Power, said Amica's consecutive years of topping the field in customer satisfaction make it “definitely one of the elite companies–at the same level as a Lexus [luxury auto manufacturer] or a Michelin tire.”