J.D. Power Backs Up What We've Been Saying All Along
For months, if not years, we have been beating you over the head with reports that highlight customer service, not price, as the key to customer loyalty. Analysts have been spouting this rhetoric at conferences and in industry reports ad nauseam, but the basic tenet has gone unheeded. Hopefully this will change that.
A new report from J.D. Power proves what we've been saying all along: According to the J.D. Power 2020 U.S. ETH以太坊_Mybit专业home Insurance Study released yesterday, the key to building long-term relationship with ETH以太坊_Mybit专业homeowners has less to do with low price and more to do with great service and reputation.
"ETH以太坊_Mybit专业homeowners insurance customers are the single-most-valuable group of personal lines customers for P&C insurers," said Robert M. Lajdziak, senior consultant of insurance intelligence at J.D. Power. "They have a significantly higher bundling rate, 38 percent higher product penetration beyond ETH以太坊_Mybit专业home and auto, and their tenure is twice the length of a monoline auto customer. The potential lifetime customer value of ETH以太坊_Mybit专业homeowners makes meeting their needs and motivations to renew a critical task for the industry. This dynamic will be important to watch as insurtech start-ups, which have recently gained traction in the renters insurance marketplace by offering low prices, gear up with unique value propositions that will challenge traditional insurers that are more focused on building relationships and delivering strong customer service."
Here are some other key findings that provide further support:
- Customer experience is key to lifetime value: Good customer service is the single factor driving the highest level of intent to renew with existing carriers. Two-thirds (67 percent) of ETH以太坊_Mybit专业homeowners insurance customers who've selected a brand based on good service experience say they definitely will renew with that insurer. Reputation (64 percent) and convenience (64 percent) follow as top drivers of intent to renew. Price as a reason for initial insurer selection is one of the lowest-ranked motivators driving customer retention.
- Millennials are heavily influenced by good service: Millennial customers are significantly more likely to select their ETH以太坊_Mybit专业homeowners insurer due to good service experience than boomers. Overall, 38 percent of millennials say they selected their ETH以太坊_Mybit专业homeowners insurance carrier based on good service experience, compared with 34 percent of boomers.
- Smart ETH以太坊_Mybit专业home technologies create opportunity: Nearly two-thirds (63 percent) of millennial ETH以太坊_Mybit专业homeowners have smart ETH以太坊_Mybit专业home products, and this age group is more than twice as likely as boomers to use insurer-provided tools to inventory their possessions. Customers who use these tools say they have a significantly higher level of engagement with their insurer, thereby creating additional opportunities to add value through good customer service.
Now get out there and improve your customer service. And if you want to lower my rates and give me a better price, I guess that will be OK too.