WESTLAKE VILLAGE, Calif. – For the third year in a row, the Amica Mutual Insurance Co. tops a national ranking of homeowners insurance customer satisfaction produced by the market research firm J.D. Power and Associates.
The recognition comes just six weeks after Lincoln, R.I.-based Amica was ranked best in J.D. Power’s 2004 National Auto Insurance Study, for the fifth consecutive year.
Amica wrote over $262 million in homeowner policies last year, a relatively small share of a $49-billion market. In Rhode Island, it holds about one-tenth of the policies, second to Nationwide Mutual Fire Insurance.
Based on responses from 12,335 policyholders, the 2004 National Homeowners Insurance Study rated companies in four categories: overall experience, policy options, pricing, and the quality of agents and company representatives.
Amica got the best possible rating in all four categories, and 855 points on a 1,000-point scale, about 12 percent higher than the industry average, 764. State Farm came in second, with 794 points. Nationwide got 776, and Allstate, 765.
As in the auto insurance survey, one company did top Amica: USAA, which serves only the U.S. military community and their families.
J.D. Power also said consumers reported spending a median of $600 a year for home insurance premiums in 2004, up from $580 in 2003, and up from $452 in 2001, an increase of 33 percent during the past three years. Overall, however, premiums have largely stabilized and in some markets may even be falling, the survey found. And for the most part, the recent premium hikes haven’t driven customers away from their insurers.
“Overall, we haven’t seen a significant increase in shopping behavior over the past three years,” Jeremy Bowler, director of the insurance practice at J.D. Power, said in a news release. “While shopping has increased significantly in the auto insurance industry, similar premium hikes don’t appear to have driven consumers to shop for homeowners insurance in the same way.”
There is an exception, however: 22 percent more customers who’ve owned their homes for over 20 years went shopping for better rates.
“These are typically the customers an insurer considers their most loyal and profitable,” Bowler said. But rate increases alone probably didn’t trigger the shopping, he said. “Rather, it appears that those consumers whose increasing property values have caused their homes to become significantly underinsured may have experienced more substantial premium increases, prompting their rate of shopping.”
The J.D. Power customer satisfaction index shows customer experience is driven by five factors (in order of importance): interaction with the provider; policy offerings and initiation; billing; cost; and claims. The study found that while only a fraction of consumers filed a recent claim, those who have tend to be significantly more satisfied with their carriers than those who have not filed a claim.
“Until a customer files a claim, an insurance policy is really just a promise,” said Bowler. “Only those customers who have seen that promise honored can truly appreciate the value they receive in return for their annual premium.”
Headquartered in Westlake Village, Calif., J.D. Power and Associates is an ISO 9001-registered global marketing information services firm that does market research, forecasting, consulting, training and customer satisfaction studies.
