Repair Time Amounts To Customer Satisfaction

The time it takes to repair a policyholder's home or auto damages has a major impact on the customer's satisfaction with their carrier, according to a J.D. Power and Associates 2007 Insurance Claims Study.

The Westlake Village, Calif.-based survey company said its inaugural study measured auto and homeowner insurance customer satisfaction with the claims process by examining several key factors.

The study found that one in four claimants had out-of-pocket expenses (in addition to their deductible) that were not fully reimbursed. These customers are the least satisfied with the settlement experience.

J.D. Power said that depending upon the complexity of a claim, the customer may experience all or only some of the following factors: claims settlement, claim servicing, first notice of loss, estimation process, repair process and rental experience.

The study found that among the two-thirds of customers whose vehicles are fixed and returned within 14 days, satisfaction averaged 843 on a 1,000-point scale.

However, satisfaction with the claims process declined by 71 points among the 36 percent of customers who waited longer than two weeks for their vehicle to be repaired.

Overall satisfaction among homeowner insurance customers is similarly impacted when repairs take longer than initially anticipated.

“It becomes extremely important to manage customer expectations as far as how long it will take for their vehicle or property to be repaired or replaced,” said Jeremy Bowler, senior director of the insurance practice at J.D. Power in a statement.

He said taking the initiative and contacting the customer to explain what is happening and why can soften the impact of a long repair process.

In addition to repair times, the number of people a customer interacts with throughout the claims process can also significantly impact satisfaction.

While nearly 75 percent of customers with an agent contacted their local agency first, more than one-third of these customers were either redirected to call the insurer or transferred to a call center. The redirected customers tend to be much less satisfied with the claims experience.

Mr. Bowler said that customers react negatively to dealing with a number of representatives because they will have to repeat claim information, adding time to the claims process.

“Customers with a local agent are most likely to be satisfied with claims servicing if they report the incident to the agent and that agent remains as the primary claim contact thereafter,” he said.

The 2007 Insurance Claims Study is based on 10,832 responses from auto and homeowners insurance customers who filed a claim within the past 12 months. The study was fielded from August to September 2007.

Additional information about the study is available at: www.jdpower.com/corporate/library/download/?files=9998886.