While overall customers are more satisfied with their experience shopping online for auto insurance, they are less thrilled with the websites of individual insurance companies, with only slightly more half saying they “definitely will” return to the site for their servicing needs, according to the latest J.D. Power study.
The J.D. Power 2016 Insurance Digital Evaluation Study, now in its fifth year, measures online consumer experiences among auto insurance shoppers. The study examines the functional aspects of websites rather than such aesthetic aspects as look and feel. Consumers performed a number of tasks online and then rated the ease of performing them on a 5-point scale. Their ratings were used to compute an overall index for shopping and servicing experiences based on a 500-point scale.
Overall satisfaction among customers shopping online for auto insurance improved by 7 index points to 376 in 2016, but satisfaction among customers using their insurer’s website for servicing activities has a more modest 4-point improvement to 424. Some of the more basic service tasks, such as printing or requesting new or replacement ID cards, updating the user profile or adding a driver or vehicle to the policy, earn the lowest overall experience scores, according to J.D. Power.
“While satisfaction hasn’t suffered yet, it likely will if insurers don’t invest in their websites and keep pace with other industries,” said Valerie Monet, director of the insurance practice at J.D. Power. “Compared with the servicing experience, there is still more room for improvement. The digital sales experience poses a growing financial risk for insurers as they work to close new business.’
She said failed quote rates range between 4 and 6 percent and can add up to substantial lost business if customers don’t turn to another channel to finalize their quote and close the deal.
Customer expectations of their insurer’s website are set based on their experiences on other sites, including non-insurance sites, according to J.D. Power. Some insurance companies have begun using responsive design technology, which helps facilitate access across multiple devices. However, the J.D. Power insurance analysts say there is still work to be done to making sure information on the site is easy to find and understand. Nearly one-fourth of auto insurance customers do not completely understand the information about their current deductible, coverages or the claims process when accessed via their insurer’s website.
Monet said that direct insurers have more heavily invested in their websites than agent-based insurers. She said this is because it’s a primary channel of communication with their customers and key to new-customer acquisition strategies. Brands like Esurance, GEICO, Mercury and USAA achieve some of the highest scores in the overall service index.
Overall, 57 percent of insurance customers own a smartphone and 38 percent own a tablet. Gen Y (those born between 1977-1994) has the highest usage rate of mobile, with 95 percent owning a smartphone and 79 percent owning a tablet. Automotive insurance mobile application servicing continues to increase year over year, with Gen Y and Gen X (born between 1965-1976) not only having the highest proportion of users, but also growing at the highest rates. Gen Y’s adoption rate has nearly doubled to 53 percent in 2016 from 27 percent in 2014, while Gen X has increased to 35 percent from 22 percent.
Among Gen Y users of mobile apps, 90 percent expect all the services and information to be available from the insurer’s website to also be available from the app.
Among customers who delete their insurer’s app, two of the most common reasons are that they didn’t use the app or the app was too slow.
“Across multiple industries, mobile devices are increasingly being used for online transactions,” said Monet. “Although apps have been slower to gain popularity in the insurance industry among consumers, once they do, customers’ expectations are likely to be high based on their experiences in other industries such as banking. Highly rated apps from other industries typically focus on key actions while underperforming apps have outdated interfaces.”
Among the 20 insurance companies included in the study, Esurance, GEICO, Mercury, Safeco and USAA (in alphabetical order) perform particularly well in the service index, while Erie Insurance, Esurance, Liberty Mutual, Travelers and 21st Century (in alphabetical order) perform particularly well in the shopping index.
- More than half (56%) of all customers have visited their insurer’s website in the past month. Additionally, customers have visited their insurer’s website an average of nine times in the past 12 months.
- Nearly one-fourth (23%) of customers do not or only partially understand the policy information offered on their insurers’ website
- Only 26% of customers indicate the speed at which they can pay a bill on the website exceeds their expectations.
- Over half (55%) of customers say they “definitely will” return to the website for service needs.
- Eleven percent of shoppers indicate the online quote process is more complicated than they expected.
- The speed of the quote process exceeds the expectations of only 25% of shoppers. In contrast, 12% of customers say the online quote process is slower than they expected.
- Nearly half (46%) of all shoppers access and find videos of policy information helpful, an increase from 39% in 2015.
The 2016 Insurance Digital Evaluation Study is based on responses from 3,854 shopping evaluations and 3,340 service evaluations of auto insurance websites. The study ranks 20 websites for both shopping and service. The study was fielded from January through March 2016.