By: Luke Jones, Published on June 7, 2016 05:56 PM, Last Update on June 8, 2016 12:59 PM
Customers are increasingly satisfied with homeowners insurance in Canada’s eastern provinces, but catastrophic events in western provinces result in lower satisfaction results, according to the J.D. Power 2016 Canadian Home Insurance Study, released this week.
J.D. Power surveyed 7,438 homeowners with insurance policies around Canada, with overall satisfaction decided on a 1,000-point scale. That annual study asks customers to judge five criteria in order of importance: non-claim interaction; policy offerings; price; billing and payment; and claims. The non-claim interaction factor includes three subfactors: local agent or broker; call centre service representative; and website.
In a press release rolled out on Monday, J.D. Power showed that the Atlantic/Ontario region improved its satisfaction rating by nine points, from 759 last year to 768 this year. Quebec saw a 20 point increase from 777 in 2015 to 797 in 2016’s study. Customers in these regions were largely satisfied across all criteria, although the cost of home insurance in Ontario remains a sticking point.
Across to the western provinces of Canada and the picture is not so good. Western region satisfaction fell to 732, down from 745 year-on-year. J.D. Power points out that a number of catastrophic events have hit these western regions, resulting in rising premiums and more contact with insurers. Fire-related claims actually fell during the year, but storm related claims increased substantially from 37% last year to 44% this year.
“The western provinces have had some very severe events in recent years, like the current Fort McMurray wildfire, which have caused significant financial losses for insurers,” said Valerie Monet, director of the insurance practice at J.D. Power, in the release. “When insurers are managing losses, rate increases are common and cost control is a frequent focus. From a customer perspective, price satisfaction hasn’t improved over the years, and data suggests that many insurers have not had time to focus their efforts on improving the customer experience after the upheaval these claims events have had on their business.”
The study shows that customers who are considered extremely satisfied (“delighted” with satisfaction scores of over 900) are less likely to change provider when renewing a policy and are more likely to recommend their insurer to other customers.