Customer satisfaction with auto insurers increases, but generational divide is clear: study

Satisfaction with Canadian auto insurance carriers has improved across all regions in the country since last year, mainly because of fewer premium increases and improved policy offerings, according a new study from J.D. Power and Associates.

The 2012 Canadian Auto Insurance Satisfaction Study, released Sept. 25, measures Canadian customers’ experiences with their primary auto insurers. The company surveyed 11,620 auto insurance policyholders in June and July 2012.

Customer satisfaction is measured across five factors: interaction; price; policy offerings; billing and payment; and claims. Insurers are ranked in three regions: Western (British Columbia; Alberta; Saskatchewan; and Manitoba); Ontario/Atlantic; and Quebec, with an overall score on a 1,000-point scale.

Western region had smallest satisfaction increase

In the western region, the satisfaction increase from 2011 was smallest, at five points. That’s mainly because of a higher number of insurer-initiated premium increases, J.D. Power suggests. A quarter of the customers in that region reported an insurer-initiated increase in 2012, compared with only 18% in 2011. The western region was the only area with a higher frequency of premium increases compared to last year.

In that region, Canadian Direct Insurance ranked highest in customer satisfaction, with 806 points, followed by State Farm (778) and TD Insurance (773).

Ontario/Atlantic customers satisfied with discounts

In the Ontario/Atlantic region, customer satisfaction increased by 11 points since last year, mainly because of increased satisfaction with insurer policy offerings and quality of discounts. In the region, 60% of customers received three or more discounts on their policy, a six-percentage-point increase over 2011. About 30% of customers in the region reported an insurer-initiated rate increase in 2012, a four-percentage-point decrease from last year.

In that region, Grey Power ranked highest with a score of 786, followed by the Co-Operators (774) and Belairdirect and Zenith (786 each).

Quebec customers most satisfied

Satisfaction in the Quebec region increased most, by 17 points. Satisfaction increases in billing and payment and price influenced that increase, the company said. Only 11% of customers reported an insurer-initiated rate increase in 2012, a three-percentage-point decrease from 2011.

In that region, La Capitale ranked highest with an 850 satisfaction score, followed by The Personal (842) and Desjardins General Insurance (832).

Gen Y satisfaction not as strong

A generation divide does exist when it comes to satisfaction, the study notes. Satisfaction gains weren’t as strong among generation Y customers as they were among baby boomers. Gen Y customers were significantly less satisfied at 737 points, while baby boomers reported a satisfaction level of 770.

Gen Y customers are also more critical of their insurer when service expectations aren’t met. In terms of interaction with their insurer, particularly with local brokers and call centres, satisfaction among gen Yers was almost 50 points lower than baby boomers.