Agents Who Focus Only on Homeowners Insurance Customers Are Missing A Long-Term Opportunity with Renter Customers as Their Needs Grow
WESTLAKE VILLAGE, Calif.: 30 September 2013 — Insurance agents who only focus on homeowners insurance customers are missing a golden opportunity to build long-term relationships with renter customers as their insurance needs grow due to life or circumstance changes—such as having a family or purchasing a home or additional car—according to the J.D. Power 2013 U.S. Household Insurance and Bundling StudySM released today.
While 25 percent of consumers rent their primary residence, 46 percent of renters are uninsured.
Satisfaction with insurers is higher among renters than among homeowners (809 vs. 787, respectively, on a 1,000-point scale).
Price is the leading driver of the satisfaction gap: price satisfaction is a significant 45 points higher among renters than among homeowners.
Renters place more importance on website (22%) and assisted online (11%) interaction channels than do homeowners, which is influenced by the younger customer base in the renter insurance market.
State Farm captures the largest share of the renter insurance market (26%), followed by Allstate (12%) and USAA (10%).
Customer retention rates with their current insurer are higher among renters who bundle an auto policy (91%) compared to renters who do not bundle an auto policy (67%).
"Many insurance agents focus their time selling high-dollar products, such as auto and homeowners, with higher commissions instead of the average $200 per year renters policy," said Jeremy Bowler, senior director of the global insurance practice at J.D. Power. "This is shortsighted because agents who satisfy the large renter population today are more likely to retain and service their growing household insurance needs over time."
Homeowners Segment: Amica Mutual (842) ranks highest, followed by State Farm (813) and Auto-Owners Insurance (812). Renters Segment: Nationwide (823) ranks highest, followed by American Family (817) and Automobile Club of Southern California (814).
The 2013 U.S. Household Insurance and Bundling Study is based on 21,167 responses from customers who may have the following insurance product lines: homeowners; renters; individual life insurance; recreational vehicle; personal liability umbrella; and secondary residence. The study was fielded from June 10, 2013, through July 12, 2013. The study examines overall customer satisfaction in each of these product lines; however, the study only ranks performance in two personal property insurance segments--homeowners and renters. Both index scores are comprised of five factors: interaction; policy offerings; price; billing and payment; and claims.
About J.D. Power
J.D. Power is a global marketing information services company providing performance improvement, social media and customer satisfaction insights and solutions. The company's quality and satisfaction measurements are based on responses from millions of consumers annually. Headquartered in Westlake Village, Calif., J.D. Power has offices in North America, Europe and Asia Pacific. For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. J.D. Power is a business unit of McGraw-Hill Financial.
About McGraw Hill Financial
McGraw Hill Financial (NYSE: MHFI) is a leading financial intelligence company providing the global capital and commodity markets with independent benchmarks, credit ratings, portfolio and enterprise risk solutions, and analytics. The Company's iconic brands include: Standard & Poor's Ratings Services, S&P Capital IQ, S&P Dow Jones Indices, Platts, CRISIL, J.D. Power, and McGraw Hill Construction. The Company has approximately 17,000 employees in 27 countries. Additional information is available at www.mhfi.com.
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