Study Shows Small Insurance Businesses Struggle With Customer Satisfaction

A new study by J.D. Power, the 2017 U.S. Small Commercial Insurance Study, found that there is a widening satisfaction gap between small insurance businesses of different sizes. Anyone who pays attention to the insurance industry has known about this satisfaction gap for quite sometime, but now J.D. Power has provided the concrete numbers to prove it.

The study found that the satisfaction gaps among business with fewer than five employees and those with 11-50 employees have never been wider since we started measuring. There has been steady improvement in customer satisfaction for larger insurance companies, while the smaller sized companies have shown a steady decline over the same time period.

Specifically, the larger insurance companies (those with 11-50 employees) saw customer satisfaction numbers increase by 13 index points, according to this new study. Conversely, the smaller insurance companies saw a customer satisfaction loss of 18 index points. These numbers clearly illustrate a growing rift in the insurance industry that many companies are going to have to work hard to mend.

Colleen Cairns, a senior analyst for J.D. Power told the Insurance Journal that “There is a notable opportunity for insurers of companies in the very small business segment, which are clearly not being serviced at the same level as their slightly larger counterparts. The key to effective growth in that slice of the market is a focus on strong agent interactions and smart use of digital and self-service tools designed for the unique needs of businesses where the target customer is often the time-pressed owner of the business.”

Essentially, there is a space in the market for smaller insurance companies who make customer satisfaction a priority. How long will that space remain and who will fill it? We’ll let you know when we find out. For now, here are the overall customer satisfaction index score results for the 2017 U.S. Small Commercial Insurance Study.

Study Rankings

Overall Customer Satisfaction Index Scores
J.D. Power.com Power Circle Ratings
(Based on a 1,000-point scale)
For Consumers

  • Farmers: 838
  • Allstate: 833
  • Chubb: 830
  • Erie Insurance: 830
  • AIG: 828
  • State Farm: 827
  • Auto-Owners Insurance: 826
  • Industry Average: 825
  • Zurich: 820
  • American Family: 819
  • Liberty Mutual: 817
  • The Hartford: 814
  • Nationwide: 813
  • Travelers: 813
  • CNA: 807

Sources:

http://www.jdpower.com/press-releases/jd-power-2017-us-small-commercial-insurance-study