Agents Provide Little Client Joy, Customer Survey Finds 

NU Online News Service, Feb. 24, 12:48 p.m. EST

A survey of U.S. consumers’ experience with a variety of professions finds they rate their interactions with independent insurance agents as less than enjoyable.

Forrester Research Inc. last week released the results of its “Customer Experience Index 2010: Insurance Providers” for a number of different industries throughout the United States.

In the area of insurance providers, independent agents received an overall score of “okay” from the more than 4,600 consumers who said they had interaction with a variety of companies. The results have an accuracy range of plus or minus 1.4 percent.

The survey, done over the Internet in October of last year, asked consumers to rate companies on three areas: “meets needs,” “easy to work with” and “enjoyable.”

When it comes to “enjoyable,” consumers rated independent agents “poor,” but gave them “good” ratings for “meets needs” and “easy to work with.”

The report found that insurer USAA topped the list with a score of 82 percent, giving it a “good” rating, nine percentage points ahead of the other 13 insurance providers rated. A score of 85 percent and higher is rated “excellent.”

This was the third year in a row that the insurer earned the top spot in the survey, but it was down 1 point from 2008 (there was no survey in 2009). USAA limits sales to past and present members of the U.S. military and their families.

Other insurers receiving “good” ratings were Liberty Mutual Insurance, Progressive and the Hartford.

Coming in at the bottom of the list was Nationwide Mutual Insurance, earning a “poor” rating.

USAA earned the highest ranking in the enjoyable category, while USAA and Liberty Mutual earned the highest marks in “meets needs” and “easy to work with.”

Of all the insurers, Liberty Mutual made the largest improvement, Forrester noted, with a 15 percentage point increase over its 2008 rating. The insurer also had the biggest jump in “enjoyable” with a 23-point increase.

Seven insurers saw their score drop, with Nationwide experiencing the most significant drop of 9 points.

Independent agents score rose 4 points to 74 percent.

Overall, the insurance industry, compared to 13 other industries, scored “okay” with a median percentage of 72 percent, just slightly behind investment firms. Retailers, hotels and parcel delivery-shipping firms were ahead of the insurance industry in the index.

But the industry led banks and was far ahead of health insurance plans, which was at the bottom of the list at “very poor.”

Forrester noted that the results of this survey are important because a modest improvement in customer experience can total up to $298 million in annual revenues for a $10 billion insurance provider.

Bruce D. Temkin, vice president and principal analyst for customer experience, who writes the blog Customer Experience Matters, said many insurers are in what he feels is the early stage of dealing with customer experience.

Many believe they can improve the experience by concentrating on one area of marketing, but to be successful companies need to take a holistic approach, which is why Liberty Mutual has done such an impressive job of improving its standing, he said.

For agents, the customer experience is tied to how well the carrier treats its customers, he noted. When the carrier is not committed, it reflects on the agent.

“No one own the complete experience, but at the end of the day there are a lot of interlocking pieces that influence the experience and every party has a strong influence on the outcome of the customer’s experience,” observed Mr. Temkin.

Copies of the report cost $499 and can be purchased online from sale from the Cambridge, Mass.-based research firm at www.forrester.com.  

• • 2/24/2010 1:44:27 PM
  • Kristin
  • comment
  • It’s so unfortunate that insurance agents get a bad rap when it comes to customer satisfaction. And I can’t understand why. In this industry, we don't have a huge turn-over rate, which means that insurance professionals have a higher level of knowledge and experience ...as compared to many other industries. Agents equipped with more knowledge and experience should be providing the customer with a better experience. The agents are able to intelligently advise the customer on coverage options, explain risks, find discounts, etc. And I don’t agree with Bruce’s opinion that customer experience is tied to how well the carrier treats its customers. From a customer perspective, if my agent is actively doing everything he/she can for me and making that fact known to me, than my experience is already better because I feel that I am being taken care of, regardless of the carrier’s involvement. From the agent’s side, I can understand how frustrating is it to make the customer happy when the carrier is putting up road blocks, but we can’t get lazy about those situations. Road blocks can be moved around and rearranged. So what are the real reason customers don’t have a good experience? I’m sure price and general understanding of insurance (or the lack there of) are factors, but I can guess that more often than not, the customers are treated as bothersome customers who can’t understand what they are buying or why they need it. It’s our job to share our knowledge and experience with each customer, regardless of how long that takes. And to show each customer that their individual policy, concerns, claims, etc., is important and a priority, regardless of how difficult the carrier is being.
• • 2/24/2010 2:37:32 PM
  • Mike
  • Interraction Survey
  • Our take on this as an Independent Agent is that there is a level of anger in our society due to the economy and what the government is doing to us, that the consumer is always mad about something and we have to work hard to service our clients to keep them on the books.
• • 2/25/2010 9:58:22 AM
  • John Brink
  • USAA Customer Rating
  • As a USAA member since 1973, I definitely agree that they stand well above the crowd regarding all aspects of the company. However, as an independent agent since 1986, I question the validity of this survey as I don't believe USAA is sold through independent agents.
• • 3/4/2010 11:53:32 AM
  • sandy ramsey
  • Insurance consumer survey
  • Excellent and interesting; Worthwhile goals to establish.
• • 3/8/2010 1:55:12 PM
  • Kathleen Wallace
  • Employee benefits
  • It's unclear exactly which type of customers (assume just P&C buyers?) were surveyed, but it has been my experience that most consumers don't know what their policies cover until they need them, then are disappointed or have unrealistic expectations. Many confuse "service" with "compliance" and get angry when they don't get their claims approved or paid at higher levels of replacement because they don't meet the rules or requirements of the policy. They refer to denials or adherence to policy limits or exclusions as "poor service." Policyholders need to take ownership of those expectations, because the blame tends to get placed on the carriers who are simply administering the policies as purchased. Does this (or any) survey ask the respondents how well-informed they were of their coverage prior to filing a claim? I have to agree with Kristin on that one. I think Liberty Mutual's results also show that the company is pushing its responsibility theme down to their employees (their internal mantra is "this is who we are, this is what we do"), who are also policyholders, and not just leaving it in the print ads.

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