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Where your auto insurer ranks in customer satisfaction

J.D. Power and Associates, that bastion of customer-satisfaction measurement, has conducted its first survey of auto insurance companies and rates Amica Mutual Insurance Co. No. 1 in the nation for customer satisfaction.

Top 10 auto insurers in customer satisfaction

Company Score
Amica Mutual 909
Erie 852
State Farm 841
21st Century 835
AAA 826
Nationwide 820
The Hartford 817
Liberty Mutual 816
Allstate 809
Industry average 809
Source: J.D. Power and Associates 2000 National Auto Insurance Customer Satisfaction Survey

Surveying more than 13,000 auto insurance policyholders to arrive at the rankings, J.D. Power asked questions about insurance company coverage offerings, pricing, claims handling, agents' knowledge of insurance policies and procedures, and an insurer's ability to solve a customer's problem. Scores are based on a scale of 0 to 1,000, with 0 being unacceptable and 900 to 1,000 being "truly outstanding." The industry average is 809.

Erie Insurance Co., State Farm Mutual Automobile Insurance Co., 21st Century Insurance Co., and GEICO rounded out the top five. USAA received the highest score, 937, but because the insurer sells coverage to only military personnel, retirees, and their immediate families, it was disqualified from the rankings.

"We're just delighted," says Patricia Stadnick, a spokesperson for Amica. The award is a testament to Amica's long-standing tradition of taking care of customers, she says. Amica has the option of purchasing from J.D. Power the advertising rights of its No. 1 ranking — a step the insurer definitely will take, Stadnick says.

Stephen Milne, CEO of Erie, says, "We are thrilled with J.D. Power and Associates' study because it validates the outstanding service record of the employees and agents of Erie Insurance Group."

"Our ranking shows that the large majority of our customers are satisfied with us," says Dave Hurst, a spokesperson for State Farm. Hurst largely attributes the satisfaction rate to State Farm agents and claims handlers who maintain regular contact with customers.

Ric Hill, a spokesperson for 21st Century, says his company is pleased with the survey's results, not only because his company was highly ranked, but because it gives consumers another unbiased source of information to aid them in their shopping.

Several insurers might be glowering rather than glowing. AIG, American Family Mutual Insurance Co., Farmers Insurance Group, Prudential Insurance Co., Safeco Insurance Co., and Travelers Insurance Co. finished below the industry average. Progressive declined to comment on the survey, while Kitty Miller, a spokesperson for Farmers, says her company can't respond to the results because its has not yet had a chance to review the full report.

Satisfaction lies in insurance contact

Frank Forkin, a partner within the U.S. automotive division at J.D. Power and director of the study, says Amica, Erie, and State Farm are highly rated because of the "professionalism and honesty" of their agents and company representatives. Being there, following up, and being able to fulfill the commitment made to the policyholder at sales time will earn an insurer high marks for customer satisfaction, he says. "Customer relationship-building is driving customer satisfaction," Forkin says.

Forkin notes that insurers that are able to settle claims quickly and fairly score big points with customers, but the J.D. Power survey found that only 34 percent of the surveyed auto insurance policyholders have filed a claim within the past three years. So, a policyholder's experience at sales, renewal, and follow-up time will more often than not color their impressions.

Other interesting findings

Who says agent extinction was just around the corner? One-third of all policyholders surveyed say they will never give up their agent, Forkin says. What's more, it looks like insurers would have to slash prices in order to pull policyholders away from their agents. An auto insurer selling via the Internet or phone would have to discount its policies by $200 to pull just 36 percent of the survey respondents away from their agents.

The No. 1 reason policyholders defect is because of a better price elsewhere. Sixty-eight percent of the respondents say they have left one insurer for another, and 61 percent of those people say price is the reason. The No. 2 reason is to get better coverage (31 percent), and the No. 3 reason is to receive better service (16 percent).




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