Insurance Shopping Study

What the average consumer does not know about automobile insurance and how they conduct themselves, could fill a book, or at least an extensive report conducted by J.D. Power and Associates.

The Habits

In the 2010 J.D. Power and Associates conducted a study which focused on the habits of the average insurance consumer.

The J.D. Power and Associates 2010 U.S. Insurance Shopping Study was based on responses to a series of questions asked to more than 14,000 shoppers who had requested an insurance quote in the previous 12 months.
Surprisingly the first thing they discovered was that 10 percent of these people did not choose the provider with the lowest price even when it might have saved them hundreds of dollars. Many of these shoppers could have saved themselves more than $250, but instead made their decision based on customer service rather than cost.

Customer Service is What People Want

Surprised to hear some people care about service more than they do about savings? You shouldn’t be.

The study found that more than 75 percent of shoppers who got a quote they didn’t like cited price as the reason they didn’t go with that company for their insurance needs. Interestingly enough, the study also found that price accounted for less than 30 percent of the overall satisfaction the consumer felt toward their insurer.

“While competitive pricing is critical to closing the sale for most shoppers, insurers must perform on all elements of the purchase experience to gain and retain satisfied customers,” said Jeremy Bowler, senior director of the insurance practice at J.D. Power and Associates. “In fact, past service experiences play a considerable role in the purchase decisions of retained customers, and in some cases, may even outweigh the appeal of a lower-priced competitor.”

Erie Insurance ranked highest among insurers for the third consecutive year. The Hartford was second and Auto-Owners Insurance was third.

Age Factor

The study also found that younger customers were much less sensitive to price than any other category, while those in the Baby Boomer generation more often cited price as the determining factor. Interestingly enough, both those groups regularly made use of their insurnace company web site, about 58 percent for younger and 46 percent for the older drivers.

Another interesting point, the younger drivers were much more likely to buy their insurance direct from the company (51 percent) instead of through an agent (36 percent) like their more senior consumers.

According to the J.D. Power and Associates study there are certainly marked differences between age groups when it comes to buying habits of those looking for insurance. But overall, service is the biggest factor when it comes to who you want to give your money to.

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