J.D. Power: Homeowners property claim satisfaction at 7-year low
Insureds who use digital tools for claims reporting see faster claim times overall, but J.D. Power found that this hasn’t helped overall satisfaction among those customers.
An increase in severe storms and high-severity claims has led to slower time frames for the claims process. Repair cycle times now average 23.9 days – more than six days longer than in 2022. When it comes to claims related to catastrophic events, that time frame increases to an average of 34.2 days.
In turn, customer satisfaction with homeowners property claims has dipped to its lowest level in seven years, reports J.D. Power.
“Catastrophic weather events are straining an already fragile system still experiencing supply chain issues that affect the availability and cost of materials,” Mark Garrett, director of claims intelligence at J.D. Power said in a release. “Resources become strained for both insurers and the contractors doing the work. Unfortunately, it’s when claims last beyond three weeks that J.D. Power sees things decline. When claims last less than three weeks, satisfaction improves, so it’s the longer claims that are solely responsible for the decline. Insurers are challenged to manage expectations and proactively communicate during longer claim periods as customers tend to have more questions when experiencing delays.”
Insureds who utilize digital tools for claims reporting and submitting photos see faster claim times overall, but J.D. Power found that this still hasn’t led to higher overall satisfaction for those customers. Digital user satisfaction has dropped at a greater pace than those of non-digital users. Even though the 15-day average repair for these users is significantly faster than the 28-day average across non-digital users, digital users still believe the cycle should be even shorter.
To curb that drop in customer satisfaction, it’s important for insurers to temper insureds’ expectations.
“Insurers are offering digital tools and managed repair partners to help streamline the process, but these efforts are met with mixed results,” Garrett shared in the release. “Customers still expect things to move along quicker so expectation management is key.”
Customer satisfaction has also been negatively affected by rising premiums, as well as the higher deductibles some policies require for catastrophic weather damage from wind, hail and other storm-related perils. J.D. Power reports a 5 percentage-point increase (from 23% to 28%) since 2022 in the number of insureds spending $1,500 or more for either their deductible or out-of-pocket expenses.