Customer satisfaction improves auto renewals by 9 points

Fifty-nine per cent of consumers who are satisfied with their auto insurers reported that they would not switch their auto insurer for any price, according to J.D. Power and Associates.The report titled ‘Producing Highly Satisfied Customers Can Improve the Bottom Line for Auto Insurers Through Increased Renewal Rates’ measures customer satisfaction with auto insurance companies across five factors. In order of importance, the factors are: interaction, policy offerings, billing and payment, price and claims.Auto insurers with highly satisfied customers have a renewal rate nine percentage points higher on average than insurers whose customers report low levels of satisfaction, J.D. Power reports. Customers with low commitment levels are also much less likely to provide recommendations to friends and family (9%) compared with highly committed customers (81%), it adds.Additionally, researchers found the average number of recommendations made by customers with low commitment (1.4) is notably lower than the number of recommendations made by high-commitment customers (7.7). “In an industry where a one-percent shift in total market share can amount to a US$1.6-billion shift in premiums, enhancing the customer experience to gain highly committed customers is absolutely critical to auto insurers,” said Jeff Leiman, senior director of J.D. Power’s insurance practice.