2022 marks the 23rd year of the JD Power US Auto Insurance Study, which affirms lessons that should have been learned long ago. But first, as explained by JD Power, the study examines “customer satisfaction in five factors: billing process and policy information; claims; interaction; policy offerings; and price.” The results are compiled from responses provided by 36,935 auto insurance customers earlier this year, the big news this year in pricing and satisfaction. Insurance would not be immune to inflation in any scenario as materials to repair a vehicle come from the same commodities skyrocketing in price. But the last few years of crashes and skyrocketing car prices threw two more bombs on actuarial tables, forcing insurers to raise many premiums.
However, the survey found that overall customer satisfaction has not changed much from last year. Satisfaction with auto insurance averages a score of 834 out of 1,000, a single point lower than last year’s score. Overall customer satisfaction with auto insurance prices took a bigger boost, reaching a score of 769, down five points from 2021. Insurance firms that offered new methods of contact helped, policyholders were happy to get things done quickly online, and could save detailed problems for phone calls.
The result showed that some insurers helped keep scores from free-falling by taking an old lesson to heart: giving customers advance notice of the bad news and being transparent about what happened and why. More companies did more work to inform more customers in advance, with the pre-warned customers being 37% more satisfied overall.
Overall price satisfaction scores were also partially supported by the record number of drivers using usage-based insurance. That’s the term for insurance prices based on how a vehicle is driven; vehicle owners place a mobile telematics logger in their car, the captured information is then shared with the insurance company so that rates can be set based on verifiable data. Participation in usage-based programs has doubled to 16% of drivers since 2016. Based on the survey responses, they are on average 59 points happier with their prices than drivers who charge unadjusted rates.
JD Power uses the data to rank insurers by 11 national regions, and we thought there were interesting findings in the rankings as well. Only one of the major national agencies with seemingly limitless advertising budgets earned a top spot, State Farm in the Southwest region. Any other winner, some at the top for two to 11 consecutive years, may operate nationally but are regional favorites. The Hartford received the highest billing in the Northwest and in Florida. The Texas Farm Bureau owns that state and came first, Wawanesa operates only in California and Oregon and took the trophy for California. At the other end of the list, in all but one of the states where it made the ranking, Nationwide appeared at the bottom or near the bottom. So make sure you stay informed about your best options – it seems they are mostly not in YouTube ads.