Improved Interactions Drive Gen Y Increase in Auto Insurance Satisfaction
Gen Y customers are the driving force behind an increase in overall auto insurance satisfaction due to improvement across all customer service interaction channels, the largest contributor to the customer experience, according to the J.D. Power 2015 U.S. Auto Insurance Study, released today.
The study examines customer satisfaction in interaction; price; policy offerings; billing and payment; and claims. Satisfaction is measured on a 1,000-point scale.
Overall customer satisfaction with their auto insurer has reached an all-time high of 818, an improvement of eight index points from 2014. Satisfaction among Gen Y customers has increased the most, compared with the other generations—Gen Y: +21 points; Gen X: +6; Boomers +4; and Pre-Boomers: -3.
The interaction factor has the greatest impact on overall customer satisfaction and is also the largest contributor to the year-over-year improvement. Overall interaction satisfaction among Gen Y customers (827) is up by 20 points from 2014.
Customer interaction preferences are changing. Gen Y's preference to interact exclusively through digital self-service (Web or mobile) has increased to 27 percent in 2015 from 21 percent in 2011. A similar pattern of preference is found in other generational groups (Gen X: 23 percent today versus 19 percent in 2011; Boomers: 12 percent today versus 10 percent in 2011; and Pre-Boomers: 6 percent versus 4 percent). Among the interaction channels, satisfaction with the Web site experience receives the lowest average score, most notably among Gen Y customers (816, compared with 826 for Gen X, 841 for Boomers, and 861 for Pre-Boomers).
"While customers across all generations are able to use online self-service for basic tasks, such as making a payment and gathering information about their account, they should also be able to resolve more complex issues online," said Valerie Monet, director of the insurance practice at J.D. Power, in a statement. "It is critical for insurers to resolve customers' service needs entirely on the website. This can drive increased use of the website and can minimize servicing costs, as unresolved issues frequently require a contact to call centers or agents, freeing their time to cultivate new business."
According to Monet, some activities are better performed through personal interactions. One-fourth (25 percent) of Gen Y customers indicate they would rather talk to someone in person or over the phone to discuss price changes, and 23 percent indicate they prefer in-person or over-the-phone contact over Web channels when they have questions about their policy coverage.
Other findings of the report include the following:
- The incidence of resolving issues entirely via the Website has increased for Gen Y to 81 percent (up 2 percentage points from 2014), with similar rates across generational groups—Gen X, 82 percent; Boomers, 81 percent; and Pre-Boomers, 80 percent. Web site satisfaction is 123 points lower among customers who do not resolve their issue completely via the Web site than among those who do (736 versus 859, respectively).
- Nearly three-fourths (73 percent) of Gen Y customers indicate having online access to policy information (+2 percentage points from 2014), compared with 62 percent across the other three generations. The level of awareness of online access to policy information among Gen Y customers (73 percent) is greater than among customers in the other generational groups (Gen X, 68 percent; Boomers, 62 percent; and Pre-Boomers, 54 percent).
- Nearly nine in 10 (87 percent) customers overall indicate receiving communications from their insurer via their preferred method—up 2 percentage points from 2014—compared with 81 percent among Gen Y customers, which is an increase of 5 percentage points.
- Across all generational groups, 49 percent of customers say they "definitely will" recommend their current insurer (the same as in 2014) and 50 percent say they "definitely will" renew their policy (down 1 percentage point from 51 percent% in 2014).