Study: 20% of customers consider switching insurers after collision

Nearly one out of every five customers considers switching insurance companies after a collision claim, according to a new the J.D. Power study.

“Filing an insurance claim is a critical moment of truth that shapes a customer’s overall perception of their insurer,” said Jeremy Bowler, senior director of the insurance practice. “Often, this is the first time they truly become familiar with their insurance policy. Misconceptions about what is covered by the auto policy, or what to expect during the claim and repair processes can lead to significantly lower customer satisfaction, which in turn increases the likelihood that the customer may consider switching carriers in the future.”

The 2006 Collision Repair Satisfaction Study finds that 7 percent of customers chose not to file a claim with their insurer after their most recent collision. Common reasons include: the insurance deductible was more than the cost of the repairs; concern that the carrier would increase the premium after the claim; or at the advice of their insurance agent.

The factors that drive customer satisfaction include: claims/estimation (62%); body shop (36%); and rental car (2%). Claimants whose vehicles are totaled are significantly more satisfied if their insurer gives them a clear explanation of why the vehicle is totaled and how they calculated the amount.

“The difference in satisfaction is primarily driven by how well the insurer manages the claims process, which is significantly longer for claimants experiencing a total loss,” said Bowler.