J.D. Power Survey: Good Agent Relations Make Insurers Money

J.D. Power Survey: Good Agent Relations Make Insurers Money

National Underwriter
J.D. Power Survey: Good Agent Relations Make Insurers Money

By MARK E. RUQUET
Published 3/25/2009

NU Online News Service, March 25, 3:07 p.m. EDT
The closer a carrier’s relationships with its independent agents, the more business they send its way, according to a J.D. Power and Associates satisfaction survey.

The Westlake Village, Calif.-based information services firm’s findings were contained in its first “2009 Insurance Agency Satisfaction Study.”

J.D. Power said for its report it surveyed 1,589 insurance agents who evaluated more than 10 companies across the industry.

According to the survey findings, the more satisfied an agent is with a carrier, the more premium the producer anticipates placing with that carrier in the future.

Jeremy Bowler, senior director of the insurance practice at J.D. Power, said agent satisfaction is very important because of the influence producers have over consumer-buying decisions.

“If agents are the glue that binds [consumers] to the carrier…then carriers need to do whatever they can [to improve that relationship],” Mr. Bowler said in an interview.

He pointed to an earlier consumer survey released with this report that found 60 percent of customers would renew their business through their agent. However, only 44 percent of consumers said they would definitely renew with an insurer.

An even stronger indicator of customer preference was the finding that 60 percent of customers said they would switch insurers if their agent advised them to do so.

“Companies will be hard pressed to make a loyalty play [to the policyholder] if the agent does not want to stay with the company,” noted Mr. Bowler.

He said the survey revealed that satisfaction has less to do with compensation than service elements.

The key drivers of satisfaction for agents are:
• Thirty-two percent of agents say carrier contacts are the key satisfaction driver.
• Twenty-three percent say policy offerings are their key driver.
• Sixteen percent said it is claims handling.
• Thirteen percent said technology.
• Ten percent said price.
• Five percent said compensation.

Read full article: http://www.property-casualty.com/News/2009/3/Pages/JD-Power-Survey-Good-Agent-Relations-Make-Insurers-Money--.aspx
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This posting was made my Jim Jacobs, President & CEO of Jacobs Executive Advisors. Jim also serves as Leader of Jacobs Advisors' Insurance Practice.