NU Online News Service, Feb. 24, 12:48 p.m. EST
A survey of U.S. consumers' experience with a variety of professions finds they rate their interactions with independent insurance agents as less than enjoyable.
Forrester Research Inc. last week released the results of its "Customer Experience Index 2010: Insurance Providers" for a number of different industries throughout the United States.
In the area of insurance providers, independent agents received an overall score of "okay" from the more than 4,600 consumers who said they had interaction with a variety of companies. The results have an accuracy range of plus or minus 1.4 percent.
The survey, done over the Internet in October of last year, asked consumers to rate companies on three areas: "meets needs," "easy to work with" and "enjoyable."
When it comes to "enjoyable," consumers rated independent agents "poor," but gave them "good" ratings for "meets needs" and "easy to work with."
The report found that insurer USAA topped the list with a score of 82 percent, giving it a "good" rating, nine percentage points ahead of the other 13 insurance providers rated. A score of 85 percent and higher is rated "excellent."
This was the third year in a row that the insurer earned the top spot in the survey, but it was down 1 point from 2008 (there was no survey in 2009). USAA limits sales to past and present members of the U.S. military and their families.
Other insurers receiving "good" ratings were Liberty Mutual Insurance, Progressive and the Hartford.
Coming in at the bottom of the list was Nationwide Mutual Insurance, earning a "poor" rating.
USAA earned the highest ranking in the enjoyable category, while USAA and Liberty Mutual earned the highest marks in "meets needs" and "easy to work with."
Of all the insurers, Liberty Mutual made the largest improvement, Forrester noted, with a 15 percentage point increase over its 2008 rating. The insurer also had the biggest jump in "enjoyable" with a 23-point increase.
Seven insurers saw their score drop, with Nationwide experiencing the most significant drop of 9 points.
Independent agents score rose 4 points to 74 percent.
Overall, the insurance industry, compared to 13 other industries, scored "okay" with a median percentage of 72 percent, just slightly behind investment firms. Retailers, hotels and parcel delivery-shipping firms were ahead of the insurance industry in the index.
But the industry led banks and was far ahead of health insurance plans, which was at the bottom of the list at "very poor."
Forrester noted that the results of this survey are important because a modest improvement in customer experience can total up to $298 million in annual revenues for a $10 billion insurance provider.
Bruce D. Temkin, vice president and principal analyst for customer experience, who writes the blog Customer Experience Matters, said many insurers are in what he feels is the early stage of dealing with customer experience.
Many believe they can improve the experience by concentrating on one area of marketing, but to be successful companies need to take a holistic approach, which is why Liberty Mutual has done such an impressive job of improving its standing, he said.
For agents, the customer experience is tied to how well the carrier treats its customers, he noted. When the carrier is not committed, it reflects on the agent.
"No one own the complete experience, but at the end of the day there are a lot of interlocking pieces that influence the experience and every party has a strong influence on the outcome of the customer's experience," observed Mr. Temkin.
Copies of the report cost $499 and can be purchased online from sale from the Cambridge, Mass.-based research firm at www.forrester.com.
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