The U.S. Auto Insurance Study, now in its 25th year, measures customer satisfaction with auto insurers based on performance in seven core dimensions on a poor-to-perfect rating scale.
The highest-ranking auto insurers by region are as follows:
California: Auto Club of Southern CA (AAA)
Central: Shelter (for a fourth consecutive year)
Florida: Auto-Owners Insurance
Mid-Atlantic: Erie Insurance (for a third consecutive year)
New England: Amica
New York: Travelers
North Central: Erie Insurance (for a fourth consecutive year)
Northwest: PEMCO Insurance
Southeast: Alfa Insurance
Southwest: CSAA Insurance Group (AAA)
Texas: Texas Farm Bureau
Most striking in the 2024 Auto Insurance Study is that over half of the 41,000 people polled in this J.D. Power study reported distrust in their auto insurance carrier. With auto insurance rates rising over 10% in the past year and showing no signs of coming down any time soon, insurance carriers cannot afford high levels of distrust. So what should P&C insurers do?
Elsewhere I have outlined how supporting fire departments is good business for the insurance industry. It meets the increasing demands by consumers for ethical business practices; it offers a lens into social, political and economic shifts by partnering with services that are witnessing the forefront of change; it directly supports the training and equipment needs of the overwhelmingly volunteer U.S. fire service that protect the very property and life that insurance protects. Here, I will tell you why supporting fire departments is also good customer service for the insurance industry.
Reason #1: The firefighters (and their neighbors) are insurance customers too.
82% of fire departments in the United States are entirely or mostly volunteer. This means that your neighbors, the parents of your children’s friends, local store owners, and fellow church members include volunteer firefighters. When the firefighters aren’t supported, the neighborhoods and communities in which insurance customers live are not supported.
Reason #2: Respect and Integrity.
The number of volunteer firefighters is steadily decreasing, due in part to increasing expectations on fire and rescue services with decreased resources. While people (like volunteer firefighters) are sacrificing their time and safety for their community, some insurance companies (like Progressive) do not believe that the volunteer departments should be reimbursed for the resources they use while protecting insured property. Denial after denial use the same form-letter; a letter that they sometimes can’t be bothered to even write-in the name of the fire department that they deny reimbursement. Hundreds of the same letter from Progressive to volunteer fire departments across the country state:
“you are seeking reimbursement for services by [FIRE DEPARTMENT NAME]…. It is our understanding that the cost of public services…is to be borne by the public as a whole…” (square brackets in the original).
Responding to an individual event, that involves an individual’s insured property is a service to an individual (who purchased insurance to protect against such events), not a service to the public.
While many of these volunteer firefighters work a day job and give up their nights and weekends for their community, there are a few bad actors who don’t feel these departments should be paid back for the expenses. While most insurance providers recognize that the response to, and removal of hazardous damaged property is included within the definition of “insured property,” there are still a few insurance carriers who behave as free riders on the backs of people who volunteer their time.
Reason #3: Innovating the claims process.
Fire departments are usually the very first to respond to an emergency scene. They are objective, third parties that necessarily report the scene details on their National Fire Incident Report (NFIRS). These are scene details that when submitted by the fire department to insurance for reimbursement of resources can allow the insurance carrier to reach out to their customer, or queue up a customer claim before the customer even picks up the phone.
Moreover, in an age of divisive politics and a “contact-less” culture, individuals are not often comfortable exchanging personal information with another driver in a car accident. Here again, just by the fire department providing their service and ensuring the safety and protection of life and property, they can indirectly provide another benefit – to the drivers (aka. insurance customers) by facilitating the exchange of information between drivers.
The best arguments contain evidence. It should be no surprise to learn then: what do the highest-ranking auto insurers in customer service have in common? They support the reimbursement of fire and rescue departments for responding to the insured property of their customers.