- October 31, 2017
- Posted by: E and A Insurance Quote
- Category: Blog
Insurance Customers Slow to Adopt Mobile Claims Apps: J.D. Power
Despite a nationwide advertising blitz for mobile auto insurance apps and widespread use of digital channels to purchase insurance, U.S. auto insurance customers have been slow to adopt digital claims reporting, according to the research firm J.D. Power.
Authors of the J.D Power 2017 U.S. Auto Claims Satisfaction Study believe the finding is significant in light of dramatically rising claims frequency and high losses, which are forcing insurers to control costs through increased reliance on technology.
Following are some findings of the study:
Few customers adopting digital first notice of loss (FNOL) offerings: Nearly one-fourth (22%) of auto insurance customers begin their interaction with an insurer online, but just 9% of customers opt to report a claim digitally via the web or a mobile app. Even among Gen Y or Millennials (born between 1982 and 2004) customers, who are most likely to report a claim digitally, only 12% are taking advantage of first notice of loss (FNOL) technology, a number that’s increased just 2 percentage points since 2016. Worse, overall satisfaction is 16 points lower (on a 1,000-point scale) among all customers who are using digital FNOL offerings than among those who report via phone. It means, auto insurance claims are getting reported through old way, simply calling the number on the insurance card.
Digital appraisal and status updates showing promise: While adoption rates and satisfaction with digital FNOL offerings have been stubbornly low, digital status updates and digital appraisal offerings, which allow customers to upload damage photos via a mobile app, are being used by roughly 16% of auto insurance claimants. Overall satisfaction is 33 points higher among customers who receive digital status updates than among those who do not. Customer satisfaction with digital appraisal apps is mixed based on the age of the customer, with satisfaction improving by 26 points among Gen Y and declining by 16 points among Pre-Boomers when using appraisal apps.
Claim servicing is top driver of satisfaction, but results vary widely by insurer: Claim servicing is the top driver of overall customer satisfaction, but it also has the largest range of performance when comparing the highest and lowest insurer scores. The top performer in the claims servicing factor has an overall customer satisfaction score that is 104 points higher than the lowest performer.
The 2017 U.S. Auto Claims Satisfaction Study is based on responses from 11,857 auto insurance customers who settled a claim within the past six months prior to taking the survey. The study excludes claimants whose vehicle incurred only glass/windshield damage or was stolen, or who only filed a roadside assistance claim. Survey data was collected from November 2016 through August 2017.
Commentary: In reference the above interesting statistics, people try to avoid using high technologies to do any type of insurance claims. They are used to do it either over the phone, or just visit their local agent, who will help them to fill out all the complicated paperwork. However, to my personal opinion, and years of experience, I see more and more of my clients using the high technologies not only for their usual needs, but even doing insurance claims. This means, the world is changing, and we, insurance agents, need to learn all these new technology revolutions, in order to do a better service for our community.