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J.D. Power: Insurance Rates Rise & So Does Customer Dissatisfaction

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If you keep tabs on your insurance premium, you may have recently noticed it edging up. And as it does, your dissatisfaction with your insurer is likely to climb, too.

While that might appear to be common sense, it's been verified in the 2013 U.S. Auto Insurance Study, conducted by J.D. Power and Associates.  

To gather that data, Power asked auto insurance customers across the country to score their insurers in five areas:

  • interactions and customer service
  • policy pricing
  • policy benefits
  • billing procedures
  • payments and claims settlement

Respondents assigned scores ranging from 0 (terrible) to 1,000 (pitch-perfect) in each of those areas.

The bad news for insurers that scores across all five areas clocked in below those of 2012. Average scores for policy pricing and policy benefits both tumbled 13 points, and overall satisfaction (i.e. the combined average of all scores) slipped 10 points to 794.

Dissatisfaction was most marked among customers who saw rate increases of more than $50. (That accounts for quite a few customers: when rates jumped in 2013, they've averaged $153, far above the $113 seen in 2012.) Only about 9% of customers changed insurers following rate increases of $50 or less. For those who experienced shifts greater than $50, the percentage doubled to 18%, and it jumped to 32% when the increased topped $200. 

The good news is that, even at 794, customer satisfaction remains high. In fact, that's the second-best score the industry has received since Power began tracking the data in 2000.

And insurers can maintain those high scores by keeping customers in the loop. Customers who received early notification of rate increases and had the chance to discuss options with their insurers reported overall satisfaction scores of 698. Those who didn't scored their insurer much lower, at 631.

Do you like your insurance company? If so, what have they done to keep you happy? And if not, what could they be doing better? Sound off in the comments below. 

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