A lot of attention in the auto insurance industry over the last few years has been paid to getting consumers to either switch from their old coverage providers to a new one, or stick with the one they have. And a lot of the reason that people switch isn’t necessarily high premiums – though that certainly plays a role – but rather a lack of strong customer service. Fortunately, it seems that people are generally growing more satisfied with their coverage and are therefore less likely to switch, largely because insurers are doing more to connect with young adults in particular. That may be good news for insurance agents as a whole, but they should still try to do more to keep their clients happy going forward.
There has been a slow but steady increase in customer satisfaction in the auto insurance industry over the last few years, and it seems that millennials are a driving force behind that, according to the latest data from J.D. Power and Associates. Specifically, overall customer satisfaction improved to an all-time high level of 818 (out of 1,000), that number was up eight points from the same poll in 2014. However, among young adults, the increase was 21 points.
Why is this happening?
In general, it seems as though more than 1 in 4 millennials used their insurers’ websites to resolve issues related to their coverage on their own, and that seems to have increased satisfaction in communications with those companies, the report said. Along similar lines to overall satisfaction, those in Generation Y saw a 20-point increase in this area specifically. However, they also generally have lower satisfaction with the online self-service channels themselves, which may highlight an area in which insurers can improve: Young adults want these options available to them, and use them frequently, but still want them to be improved upon.
“While customers across all generations are able to use online self-service for basic tasks such as making a payment and gathering information about their account, they should also be able to resolve more complex issues online,” said Valerie Monet, director of the insurance practice at J.D. Power. “It is critical for insurers to resolve customers’ service needs entirely on the website. This can drive increased use of the website and can minimize servicing costs, as unresolved issues frequently require a contact to call centers or agents, freeing their time to cultivate new business.”
What’s next for agents?
Studies generally show that consumers tend to be happier with their coverage as a result of high-quality customer service on the part of an insurer or agent, more so than even when they get reductions on how much their coverage costs. This serves to highlight how important it is for companies and agents to cultivate a strong relationship with each client as a means of keeping them happy and helping them better understand their plans. This is especially true as use of websites to resolve issues increases, and that, in turn, should help to drive both customer satisfaction and client retention rates.