Delivering outstanding customer service remains the most important factor in helping home insurance providers retain clients as they transition from homeownership to renting, the latest survey from data analytics and market intelligence firm J.D. Power has revealed.
However, the report also found that many home insurers were struggling to keep clients as they shift from homeowners’ to renters’ policies. According to the findings of the firm’s 2021 US Home Insurance Study, just 36% of Gen Y and Z policyholders and 44% of Gen Xers remained loyal to their insurance providers after they became renters. The number slightly improved for Boomers and Pre-Boomers at 52%.
But considering that the annual retention rate for homeowners’ insurance is almost 92%, the firm said that “there is a huge opportunity out there for insurers to get the life stage transition formula right.”
To determine how home insurers fared in terms of client experience, J.D. Power analyzed almost 12,000 responses from homeowners’ and renters’ insurance policyholders based on five indicators – interaction, policy offerings, price, billing process and policy information, and claims. After the scores were tallied, the insurance companies were ranked based on a 1,000-point scale. These are the homeowners’ and renters’ insurance providers in the US that came out on top in 2021 based on overall customer satisfaction.
USAA has consistently topped J.D. Power’s annual list both in the homeowners’ and renters’ insurance category, leading the next-placed firm by a substantial distance. However, the military insurer is not eligible to be included in the rankings “because it does not meet study award criteria,” according to the report. The insurer is also among the top companies in terms of client retention.
This year, Amica Mutual took the top spot from Country Financial, which slid all the way to eighth place, marking the biggest drop in the list. Amica Mutual slightly improved its customer satisfaction index to 854 from 853 in 2020, while Country Financial’s score dipped from 855 to 830. Both insurers, along with the other companies in the top 10, scored above the segment average of 825.
Seven insurance companies shot up the rankings, including three new entries. Automobile Club of Southern California registered the biggest jump, grabbing second place in the list after placing just outside the top 10 last year. Customer satisfaction rating for the AAA member rose from 820 to 840. Another AAA member, Automobile Club Group, locked in the fifth spot after being unranked last year. The largest leap in rating, however, belonged to AIG, which secured a tie for eighth from 13th spot in 2020, upping its customer satisfaction score from 809 to 830.
Here are the homeowners’ insurance providers that made this year’s top 10:
10. Allstate
2021 customer satisfaction index rating: 829
2020 customer satisfaction index rating: 829
2020 ranking: 6th (tied)
=8. Country Financial
2021 customer satisfaction index rating: 830
2020 customer satisfaction index rating: 855
2020 ranking: 1st
=8. AIG
2021 customer satisfaction index rating: 830
2020 customer satisfaction index rating: 809
2020 ranking: 13th
=6. Auto-Owners Insurance
2021 customer satisfaction index rating: 831
2020 customer satisfaction index rating: 843
2020 ranking: 3rd
=6. American Family Insurance
2021 customer satisfaction index rating: 831
2020 customer satisfaction index rating: 821
2020 ranking: 10th
5. Automobile Club Group (AAA)
2021 customer satisfaction index rating: 834
2020 customer satisfaction index rating: N/A
2020 ranking: Not ranked
=3. State Farm
2021 customer satisfaction index rating: 835
2020 customer satisfaction index rating: 829
2020 ranking: 6th (tied)
=3. Erie Insurance
2021 customer satisfaction index rating: 835
2020 customer satisfaction index rating: 839
2020 ranking: 4th
2. Automobile Club of Southern California (AAA)
2021 customer satisfaction index rating: 840
2020 customer satisfaction index rating: 820
2020 ranking: 11th
1. Amica Mutual
2021 customer satisfaction index rating: 854
2020 customer satisfaction index rating: 853
2020 ranking: 2nd
From 13 companies last year, J.D. Power’s list shrunk to nine firms in 2021. Insurtech Lemonade retains the top spot, upping its customer satisfaction rating from 866 to 870. State Farm enters the top five from seventh place last year, registering a score of 866, up from 2020’s 836, which is the biggest leap in scoring for the category. Only these two companies scored above the segment average of 848.
American Family and Nationwide also improved their rankings from last year, climbing to the third and fourth spots from fourth and ninth, respectively. Allstate rounds out the top five, dropping from number three in 2020 as its customer satisfaction index rating dipped from 841 to 833.
Farmers, Liberty Mutual, ASI Progressive, and Travelers are the other renters’ insurance providers on the list.
5. Allstate
2021 customer satisfaction index rating: 833
2020 customer satisfaction index rating: 841
2020 ranking: 3rd
4. Nationwide
2021 customer satisfaction index rating: 834
2020 customer satisfaction index rating: 831
2020 ranking: 9th
3. American Family
2021 customer satisfaction index rating: 838
2020 customer satisfaction index rating: 840
2020 ranking: 4th
2. State Farm
2021 customer satisfaction index rating: 866
2020 customer satisfaction index rating: 836
2020 ranking: 7th
1. Lemonade
2021 customer satisfaction index rating: 870
2020 customer satisfaction index rating: 866
2020 ranking: 1st
