Insurers still struggle to deliver seamless digital experience – report

Many insurers are still struggling to deliver a seamless digital experience to their customers even as digital channels become more vital to maintain customer satisfaction, according to a new study by J.D. Power.

Customers say their average auto repair cycle time has doubled over the past two years – now exceeding 23 days – and the average time for home repairs is also on the rise. With that in mind, insurers need to work harder to manage customer expectations, according to J.D. Power’s 2023 U.S. Claims Digital Experience Study.

However, the study found that with many insurers still floundering when it comes to delivering seamless digital experiences, overall customer satisfaction is 854 (on a 1,000-point scale), a three-point drop from 2022.

“Across all of our insurance claims experience studies, we find that the more insurers can do to manage expectations, keep customers updated and make it easy for them to manage the claims process without a lot of effort, the more satisfied customers become – even when repair cycle times are longer than ever,” said Mark Garrett, director of global insurance intelligence at J.D. Power.

“Customers have an expectation that using digital tools will create efficiencies in the process and keep them informed throughout their claim, but many insurers struggle to meet those expectations. Only 41% of customers ‘completely agree’ both expectations were met. Whether it is making a claim, submitting photos or communicating with claims staff, there are still bumps along the digital road. Notable, too, is that only 35% of customers said the estimation process was ‘very easy.’”

The study found that when those experiences did go well, it paid dividends in increased customer satisfaction.

“Digital communications in the form of personalized text messages, status updates via mobile apps and guides to help reading estimates can dramatically improve that experience without significantly raising customer service costs for insurers,” J.D. Power said. “However, many customers still indicate they need to pick up the phone to track down a status update, often resulting in repeating information to a representative. This negatively affects the overall customer experience.”

Read next: How satisfied are insurance agents with their carriers?

The study, now in its fourth year, evaluated digital experiences among P&C insurance customers during the claims process. It investigated the functional aspects of desktop, mobile web and mobile apps based on visual appeal, clarity of information, navigation and range of services.

Key findings of the study include:

• One third of claimants said they still needed to call their insurer following a digital update: Customer satisfaction with the digital claims experience was highest when claimants received an email, text or mobile app update that answered all of their questions, J.D. Power said. However, 33% of survey respondents said they still needed to contact their insurer with additional questions. This caused their overall satisfaction to tumble 78 points. Conversely, satisfaction among customers who said that claim reporting, estimation and settlement processes were “very easy,” satisfaction was 948 – and 86% of those respondents said they “definitely will” renew their policy. Among those who said none of the processes were very easy, satisfaction was only 799, and only 41% said they “definitely will renew their policy.
• Few insurers managed to offer all benefits of a digital experience: Most respondents said that their insurer’s digital tools provided at least one element of a complete digital experience, but only 35% said their insurer is meeting the standard on three criteria: creating an efficient claims process, keeping customers informed, and reducing time spent on the phone.
• Repeated photo and information submission requests damage customer satisfaction: Overall customer satisfaction among the 58% of respondents who only needed to submit photos of their damaged property once is 875. However, that score dropped to 837 when they had to submit twice and tumbled to 806 if they had to submit three times or more.

The study was based on 3,184 responses from home or auto insurance customers who filed a claim in the last 12 months.

A study released by J.D. Power this summer found record-low levels of customer satisfaction with auto insurers.

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