While the public's perception of the insurance industry in general is poor, consumers at least have a less unfavorable view of individual companies, a polling expert told mutual insurance company representatives here.
Indeed, as of July, 44 percent of Americans held a very or mainly unfavorable view of the industry, while only 19 percent held a favorable view, according to Nicolas Boyon, senior vice president of New York-based Ipsos Public Affairs, which has tracked insurance industry popularity through surveys of 1,000 people per month for over two years.
Since July, Mr. Boyon said, the numbers have deteriorated slightly–with 48 percent unfavorable and 17 percent favorable. The remainder of respondents held a neutral view, he noted during his speech at the National Association of Mutual Insurance Companies' annual convention.
However, results differ when respondents were asked about individual companies. Taking the average of responses on 40 different insurers–including 22 property-casualty carriers–only 7 percent of respondents held an unfavorable view, while the favorable view increased to 24 percent.
Mr. Boyon noted that over the last two-and-a-half years, the worst rating for an individual company was 16 percent unfavorable.
The numbers look even more favorable for insurers when polling actual policyholders. In a case study conducted one year after Hurricanes Katrina and Rita, published by the Insurance Information Institute, Mr. Boyon noted that nine out of 10 homeowners in Louisiana and Mississippi were satisfied with their insurance companies. Homeowners who had filed claims were equally satisfied.
Both Mr. Boyon and a member of the audience likened the public's view of the industry to its perception of the federal government, with people tending to like their local representatives but having an unfavorable view of Washington in general.
However, one of NAMIC's leaders suggested that the industry's reputation suffers because the business of insurance is easy to pick on and not well understood.
Insurance is really a "financial transaction," not "an entitlement," and the industry has not done a good job of making that clear to consumers, Thomas Dials, president of the Armed Forces Insurance Exchange, chair of the Armed Forces Insurance Corp. and outgoing chair of NAMIC's property-casualty conference, said in a separate interview.
Instead, he added, the industry has allowed itself to be defined by others, who are often hostile to insurers–such as politicians and plaintiff lawyers.
To counter this, he said the industry should work to create education programs in high schools and colleges that would teach young people what insurance is and how it works.
Meanwhile, Mr. Boyon said insurers should find ways to leverage satisfied policyholders so that they advocate for their companies. Insurers should look to other industries that have been successful in this area to find ways to get policyholders to bring in friends through word-of-mouth.
In comparison to other industries, Mr. Boyon said insurance is perceived more favorably than oil and gas companies, but is comparable to mortgage lenders, the federal government and chemical companies.
He also noted that, worldwide, the perception of insurance companies differs depending on the progress of economic development. For example, in the United States, Great Britain and Japan, the industry is viewed unfavorably, but in India and China, insurers are viewed very favorably.
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