Year / Project / Study Name J.D. Power and RIMS 2014 Commercial Insurance Report

Transcription

1 1

2 J.D. Power Customer Experience Framework and Index Methodology 2014 Large Commercial Insurance Study SM (TLT023) Speakers: Timothy Bebout J.D. Power Insurance PracLce Andrew Parker J.D. Power Insurance Industry AnalyLcs 2

3 Learning Objectives At the end of this session, you will learn: What drives customer satisfaction with their insurers and brokers? How can customer satisfaction scores be used to enhance interaction with insurers and brokers? What service practices are most important to risk professionals? What impacts CSI with enterprise risk management responsibility? 3

4 Study Overview Inaugural platform study measuring risk professional customer satisfaction with large commercial insurers and brokers J.D. Power and The Risk Management Society (RIMS) have collaborated to provide an unprecedented view of the large commercial market The findings focus on 3 core coverages: Property, Workers Compensation, and Auto Benchmarks customer satisfaction across key customer touch points for insurers (5 factors) and brokers (4 factors) Industry report released in December,

5 Who would you identify as leading in these lines? Property Workers CompensaEon Auto 5

6 Making the Cut: Insurer by Product Line Insurer Property Workers Compensation Auto ACE AIG CHUBB FM Global Liberty Mutual Lloyd's of London The Hartford Travelers XL Group Zurich Brands with 30 or more completes are profiled in the study: Property: 8 insurers Workers compensalon: 7 insurers Auto: 5 insurers Note: Green Denotes Profiled in Product Line 6

7 Key Performance Characteristics - Insurers Interaction & responsiveness Limited errors Pricing Knowledge of business Loss control Risk mitigation ERM experience Product flexibility 7

8 Year Project / Study Name J.D. P/ ower and RIMS 2014 Commercial Insurance Report Who would you identify as the leading Brokers? 8 J.D. Power 2014 J.D. Power and Associates, McGraw Hill Financial. All Rights Reserved.

9 Key Performance Characteristics - Brokers Interaction & responsiveness Limited errors Knowledge of business Ease of Contact Reasonableness of Fees Advice & Guidance Timeliness of resolution 9

10 Making the Cut: Broker Counts Insurance Broker Aon Arthur J. Gallagher & Co Lockton Marsh Willis 5 brokers profiled (brokers with 30 or more completes) 10

11 Risk Professionals Look For Insurers To Partner with Brokers to Meet Their Needs Risk Manager Insurance Broker Strategic Partnership Insurer 11

12 Risk Professionals Look For Insurers To Partner with Brokers to Meet Their Needs Ease of Contact Reasonableness of Fees Advice & Guidance Timeliness of resolueon Risk Manager Program Flexibility InteracEon Price Billing and Payment Claims Customer Satisfaction Insurance Broker Strategic Partnership Insurer 12

13 Insurer Drivers of Satisfaction Comparison Property, Workers Compensation, Auto Index Model Composition InteracLon Program Offerings Price Billing and Payment Claims Property 28% 24% 13% 9% Workers' Compensation 18% 20% 17% 23% Auto 16% 29% 18% 14% 0% 20% 40% 60% 80% 100% While drivers of satisfaction varies, Interaction is the second-most impactful factor across product lines, contributing to approximately one-fourth of the overall model for each line. 13

14 What Service PracEces Are Most Important to Risk Professionals? Key Performance Indicators (KPIs) Property Workers CompensaEon KPI % Met/ Compliance Impact on SaEsfacEon (Impact on CSI if Missed) Limit customer- reported problems during renewal 93% 159 Ensure flexibility when designing and implemenlng insurance program 56% 138 Limit billing errors 88% 80 Ensure insurer involvement during service interaclon(s) 51% 100 Ensure insurer involvement during claims process 41% 117 Ensure flexibility when designing and implemenlng insurance program 50% 316 Limit billing errors 62% 289 Provide 2 or more in- person contacts 26% 156 Auto Limit customer- reported problems during renewal 93% - Broker Ensure broker understands business' needs 84% 228 Provide 2 or more in- person contacts 81% 73 14

15 What is a top lever of Property CSI? Ensure Insurer Involvement During Service Interaction(s) KPI 100% Industry Average 865 Industry Average Property Index 900 Carrier A 81% 80% Industry Average 51% 60% 40% 51% 49% 700 Carrier B 37% 20% 600 Carrier C 25% 0% Direct insurer interaction No direct insurer interaction 500 0% 20% 40% 60% 80% 100% % Direct insurer interaclon Note: Insurers that are included in the industry average, but not shown due to insufficient sample sizes are: AEGIS, Allianz/Fireman s Fund, Liberty Mutual, Oil Insurance Limited, and Swiss Re. Just 51% of property customers indicate their insurer was involved during a service interaction. Satisfaction declines 100 points when an insurer is not involved in a service interaction. 15

16 What is a top lever of Auto CSI? Limit Customer-Reported Problems During Renewal KPI Industry Average Industry Average Auto Index 100% 93% 900 Industry Average 93% 80% 60% 40% Carrier A Carrier B 92% 92% 20% 0% Did not experience problems during renewal 548 7% Experienced problems during renewal Note: Insurers included in the industry average, but not shown due to insufficient sample sizes are: Auto- Owners Insurance, NaLonwide, and Old Republic Carrier C 85% 0% 20% 40% 60% 80% 100% % No renewal problems Auto insurers are delivering on this KPI at a high rate 93% of customers report they did not experience issues during the renewal, yet saesfaceon erodes by a significant 194 points when customers experience issues during the renewal process. 16

17 What is a top lever of Broker CSI? Ensure Broker Understands Business Needs 100% 80% 60% 40% 20% 0% Industry Average 84% 890 Completely Industry Average Broker Index % Partially/Not at all Broker A Broker B Broker C Broker D Industry Average Broker E 71% 89% 88% 85% 85% 84% 0% 20% 40% 60% 80% 100% % Completely understands business Note: Brokers included in the industry average, but not shown due to insufficient sample sizes are: Alliant, BB&T InternaLonal, Brown & Brown Insurance, HUB InternaLonal, USI Insurance Services, and Wells Fargo Insurance. Ensuring that customers perceive that a broker completely understands their business needs is the most impactful KPI among broker-served customers. 17

18 Key Performance Indicators Billing Property Workers Compensation 100% Industry Average Industry Average Property Index 88% % Industry Average Industry Average Workers' Compensation Index % 60% 40% % 60% 40% % 38% % 12% % % No billing errors 1 or more billing errors 500 0% No billing errors 1 or more billing errors

19 Impact of Other Services Received on Property Satisfaction Review of current market trends and developments Renewal- related meelngs Stewardship reports Loss- cost management Program services Business insights AnalyLcs (e.g., on your organizalon s losses) Claims reviews Events/Conferences Online technology planorms Claim management services EducaLonal webinars/trainings Insurer audits Risk control services (i.e., control and reduce risk) % IndicaEng 22% 59% 24% 26% 27% 26% 27% 24% 27% 34% 42% 37% 21% 52% 19

20 The Business Benefits of Customer Satisfaction Financial Return by Customer Satisfaction Tier Insurers Property Workers CompensaLon Auto Delighted/Pleased Indifferent/Displeased 26% 80% Will Recommend 16% 74% Will Recommend 21% 67% Will Recommend 19% 53% Will not Switch for Any Price 7% 54% Will not Switch for Any Price 14% 26% Will not Switch for Any Price 22% 62% Will Renew 10% 48% Will Renew 15% 57% Will Renew 20

21 The Business Benefits of Customer SaEsfacEon Delighted/Pleased Financial Return by Customer SaEsfacEon Tier Cross- Industry Comparison 2014 U.S. Member Health Plan 2014 U.S. Auto Insurance Study 2014 U.S. Retail Banking Study Study Indifferent/Displeased 13% 61% Will Recommend 8% 50% Will Recommend 23% 72% Will Recommend 8% 29% 16% 52% Will not Switch for Any Price Definitely Will not Switch 20% 61% Will Renew 10% 48% Will Renew 15% 64% Will Renew 21

22 The Business Benefits of Customer Satisfaction Financial Return by Customer Satisfaction Tier Brokers 26% 64% 79% 21% of Customers Will Recommend 29% 58% Will not Switch Brokerages (12 mos.) Delighted/Pleased Indifferent/Displeased 22

23 What More Can Brokers Do? Source: RIMS Marsh 2014 Excellence in Risk Management Survey XI, April

24 Do Enterprise Risk Management Responsibilities Change CSI? Q: To what extent has your organization adopted an enterprise risk management (ERM) program? Source: 2013 RIMS Enterprise Risk Management (ERM) Survey. All rights reserved. 24

25 Study Found Significant Differences in CSI Levels Property % of customers 100% 50% 0% % % 17% Index Scores Auto 100% 50% % % 47% % Finance/OperaLonal/Strategic (no Enterprise) Other risk management role Enterprise 600 Workers CompensaLon 100% 50% % % 41% % Other risk management role Finance/OperaLonal/Strategic (no Enterprise) Enterprise

26 Enterprise Risk Management Function Is Underserved 100% Broker % of customers 50% 43% 22% 35% Index Scores 0% Finance/OperaLonal/Strategic (no Enterprise) Other risk management role Enterprise

27 World Economic Forum : Possible Global Point of View 27

28 Relationship Implications For Risk Managers, Insurers And Brokers Value added services seen as differentiators Strategic implications in risk analyses Tools, technology and data to support risk management as risk knowledge centers Insurance discussions no longer about premium variances to budget Direct interaction More focus on balancing internal and external use of capital Alternative risk financing options Portfolio views Rating transparency 28

29 Learning Objectives What drives customer satisfaction with their insurers and brokers? How can customer satisfaction scores be used to enhance interaction with insurers and brokers? What service practices are most important to risk professionals? What impacts CSI with enterprise risk management responsibility? 29