CSI Report 2013

2013 COMPANY SATISFACTION INDEX SURVEY

RESULTS An exclusive member benefit for benchmarking carrier relationships.

C O M PA N Y S AT I S FA C T I O N I N D E X

2013 CSI RESULTS

2013

Summary The Insurance Agents & Brokers (IA&B) conducted its annual survey of member agencies’ employees in Delaware, Maryland and Pennsylvania to determine their satisfaction level with the carriers with which their agencies do business. IA&B has been collecting and sharing members’ opinions with both carriers and agents since 2004.

This year’s index focused only on commercial lines carriers.

This report is divided into four sections:

For more information: Visit IA&B’s Company Satisfaction Index interactive online tool at www.iabgroup.com. The tool is designed to provide an overview of the commercial lines results, a comparison among carriers and an in-depth look at each carrier’s individual results by question.

1. Outline of the index's structure and methodology The assessment was open to all employees of any IA&B member agency from April 15 to May 15. The last time commercial carriers were rated was in 2010, prior to the index becoming an annual tool.

With the attention solely on commercial lines carriers, there was a 63 percent increase in the number of commercial lines surveys returned compared to 2010.

Only carriers receiving 15 or more completed surveys are included in this report. This was also a change from previous years, when carriers made the final results with only 10 returned surveys. In 2013, 39 carriers were included in the survey compared to 38 carriers in 2010.

2. Key findings by carrier group The report differentiates the carriers based upon direct premium written (DPW) and the number of states in their footprint. Carriers were divided into one of four groupings: • Regional carriers (R I) operating in 1-10 states with less than $100 million in DPW • Regional carriers (R II) operating in 1-10 states with more than $100 million in DPW • Super regional carriers (SR) operating in 11 to 34 states • National carriers (N) operating in 35 or more states The results show that members’ satisfaction was highest with regional I carriers followed closely by super regional carriers and the national carriers. However, the regional II carriers were the only group to show a slight increase in satisfaction since 2010.

3. Individual carrier results To qualify for the final report, a carrier must have received 15 or more completed surveys. In total, 39 carriers were included. This

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report includes an alphabetical listing of those carriers and their results. Additionally, IA&B offers an interactive, online tool of the results, which allows the user to sort the results based upon carrier ranking or by any of the four key categories. The online tool also allows the user to see a side-by-side comparison of carriers and an in-depth examination of each carrier’s individual results by question. The online tool can be found at www.iabgroup.com/csi.

4. Key findings by category and questions The survey asked members to share their opinions based upon four key categories of their carrier relationships: • • • •

Products, Pricing & Underwriting Policy Service & Claims Agency/Company Relationship Technology

This was the first time since the inception of the commercial lines survey that overall member satisfaction decreased. However, overall average satisfaction was still higher than respondents’ satisfaction levels in 2004 and 2006. The results show that members’ satisfaction was highest with their carriers in the category of policy service and claims and least satisfied with technology.

Results allow carriers to assess performance in an independent way and compare that performance with other carriers. One goal is the overall improvement of performance for the benefit of the carrier, the agents IA&B serves and the consumers served by both.

The survey results could also serve these purposes: • For an agency to benchmark its relationship with its carriers.

• For an agency seeking new carriers to use the benchmark for the interview process.

• For a carrier to validate its perception or as a “calling” to improve.

• For IA&B to use constructively in dialogue with carriers.

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1. Survey Structure and Methodology

457

2013

280

2010

340

2008

2006

241

2004

179 0

100

200

300

400

500

600

IA&B members were asked to rate at least their top three carriers with which they place business. A total of 457 surveys were completed. This marks a 63 percent increase in participation since 2010. On average, respondents rated 5.7 carriers, a 19 percent increase from previous years.

2013

5.7

2010

4.8

2008

4.6

2006

4.6 0.0

4

1.0

2.0

3.0

4.0

5.0

6.0

7.0

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SURVEY STRUCTURE AND METHODOLOGY

Carriers included in results

Total cariers rated

2013

84

2010

82 71

2008 2006

69

2004

69 39

2013

38

2010

43

2008 36

2006

34

2004 0

20

40

60

80

100

Respondents rated 84 carriers, although over half the carriers were not integrated into this report since only carriers with 15 or more completed surveys are included in the final results (past survey years it was 10 or more). In total, 39 commercial lines carriers are included.

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SURVEY STRUCTURE AND METHODOLOGY

Improved since 2010 2013

32% 68%

Declined since 2010 40%

2010

Improved since 2008

60%

Declined since 2008

59%

2008

Improved since 2006 41%

Declined since 2006

78%

2006

Improved since 2004 22%

Declined since 2004 0%

20%

40%

60%

80%

100%

By comparing previous survey results, the index shows how respondents’ satisfaction with each carrier improved or declined. Of those carriers included in the 2010 results that were also included in this year’s results, 32 percent improved their rating from 2010, while 68 percent declined. This is the second consecutive year that more carriers declined in satisfaction from the previous year then showed improvement.

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2013

SURVEY STRUCTURE AND METHODOLOGY

8

New to this year’s results 7

Included in 2010 but not this year 3

2010

New to this year’s results

8

Included in 2008 but not this year New to this year’s results 2008

9

Included in 2006 but not this year

1

New to this year’s results 2006

4

Included in 2004 but not this year

0 0

5

10

15

Only carriers with 15 or more ratings can qualify for inclusion in the final survey results. In 2013, eight commercial lines carriers that were not included in the 2010 results became eligible: ACUITY, Foremost Insurance Group, Grange Insurance, Guard Insurance Group, Highmark Casualty Insurance Co., Lackawanna Casualty, Lititz Mutual and Motorists Insurance Group. There were seven carriers included in the 2010 results that are not included in the 2013 report, including AIG, EMC Insurance Companies, IWIF, Lebanon Mutual, Millville Mutual, PMA Insurance Group and Tuscarora Wayne Insurance Co.

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2006

2008

2010

2013

SURVEY STRUCTURE AND METHODOLOGY

Principal Producer CSR Manager Other Principal Producer CSR Manager Other Principal Producer CSR Manager Other Principal Producer CSR Manager Other

20% 16% 48% 12% 4% 41% 17% 25% 16% 1% 39% 17% 26% 11% 7% 53% 10% 24% 9% 4%

0%

20%

40%

60%

80%

100%

Any employee of an IA&B member agency in Delaware, Maryland and Pennsylvania was eligible to participate. CSRs accounted for nearly half of the surveys returned. Agency principals and producers combined for 36 percent of returned surveys.

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2. Key Findings by Carrier Group This report differentiates the carriers based upon direct premium written (DPW) and the number of states in their footprint. Carriers were divided into one of four groupings: ■

Regional carriers (Regional I) operating in 1-10 states with less than $100 million in DPW

■

Regional carriers (Regional II) operating in 1-10 states with more than $100 million in DPW

■

Super regional carriers operating in 11 to 34 states

■

National carriers operating in 35 or more states

Regional I

Regional II

Super Regional

National

Respondents indicated their satisfaction was highest with regional I carriers followed closely by super regional carriers and then national carriers. Respondents indicated they were least satisfied with the regional II carriers; however, this carrier group was the only group that showed an increase in overall performance from 2010.

2013 2010 2008 2006 2004 2013 2010 2008 2006 2004 2013 2010 2008 2006 2004 2013 2010 2008 2006 2004

3.080 3.081 3.052 3.062 2.925 3.172 3.261 3.195 3.104 2.992 3.053 3.032 3.084 3.015 2.953 3.191 3.230 3.197 3.107 2.651

1.000

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2.000

3.000

4.000

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Regional I

Regional II

Super Regional

National

KEY FINDINGS BY CARRIER GROUP

2013 2010 2008 2006 2004 2013 2010 2008 2006 2004 2013 2010 2008 2006 2004 2013 2010 2008 2006 2004

3.085 3.133 2.997 3.089 2.884 3.192 3.409 3.321 3.313 3.091 3.183 3.211 3.278 3.220 3.030 3.393 3.462 3.471 3.386 2.802 1.000

2.000

3.000

4.000

Respondents were most satisfied with the regional I carriers for commercial lines products, pricing and underwriting for the fourth consecutive survey. Participants liked their super regional carriers for the next-to-top spot—despite a decrease in satisfaction from 2010—followed closely by regional II carriers.

Respondents were again least satisfied with national carriers.

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Regional I

Regional II

Super Regional

National

KEY FINDINGS BY CARRIER GROUP

3.354 3.355 3.363 3.372 3.178 3.382 3.482 3.428 3.369 3.227 3.306 3.254 3.290 3.261 3.181 3.428 3.428 3.416 3.309

2013 2010 2008 2006 2004 2013 2010 2008 2006 2004 2013 2010 2008 2006 2004 2013 2010 2008 2006 2004

2.867 1.000

2.000

3.000

4.000

Participants were most satisfied with the regional I carriers, which took over the top spot from the super regional carriers since 2010, for the policy service and claims category. The regional II carrier group was the only group to see improved scores in this category but still finished behind the super regional and national carriers.

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Regional I

Regional II

Super Regional

National

KEY FINDINGS BY CARRIER GROUP

2013 2010 2008 2006 2004 2013 2010 2008 2006 2004 2013 2010 2008 2006 2004 2013 2010 2008 2006 2004

2.842 2.854 2.881 2.858 2.724 2.914 2.902 2.843 2.606 2.608 2.680 2.661 2.684 2.569 2.588 2.723 2.748 2.685 2.577 2.232 1.000

2.000

3.000

4.000

Technology was the category where agencies expressed their greatest dissatisfaction with carriers with very little change from 2010. Both super regional and regional II carrier groups saw a slight increase in satisfaction while both national and regional I carriers had a slight decrease.

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Regional I

Regional II

Super Regional

National

KEY FINDINGS BY CARRIER GROUP

2013 2010 2008 2006 2004 2013 2010 2008 2006 2004 2013 2010 2008 2006 2004 2013 2010 2008 2006 2004

3.088 3.072 3.073 3.030 2.975 3.224 3.317 3.263 3.208 3.107 3.084 3.075 3.144 3.088 3.055 3.255 3.336 3.273 3.205 2.754 1.000

2.000

3.000

4.000

Respondents were most satisfied with regional I and super regional carriers with regard to agency/company relationship, followed by national and regional II carriers. Both the regional II and national carriers showed slight improvement since 2010.

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3. Individual Carrier Results

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4. Key Findings by Category and Questions Participants rated their carriers on a four-point scale of satisfaction – with four (4) meaning satisfied and one (1) unsatisfied. They offered opinions on four key categories of their carrier relationships: 1) Products, Pricing & Underwriting 2) Policy Service & Claims 3) Agency/Company Relationship 4) Technology After four continuous surveys showing overall average improvement, that trend was snapped this year with a slight decrease in satisfaction. Overall average satisfaction is still higher than respondents’ satisfaction levels in 2004 and 2006. Where noted below, a few statements were added to the 2013 survey based upon member input.

2013

3.125

2010

3.156

2008

3.137

2006

3.088

2004

2.868

1.000

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2.000

3.000

4.000

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K E Y F I N D I N G S B Y C AT E G O R Y & Q U E S T I O N S

Products, Pricing & Underwriting In this category, the average score declined slightly after three consecutive years of improvement. New to this survey was a statement seeking satisfaction with the carrier’s underwriting guidelines being clear and comprehensive.

2013

3.211

2010

3.311

2008

3.274

2006

3.264

2004

2.936 1.000

16

2.000

3.000

4.000

The carrier offers competitive products and features.

3.231

The carrier promptly offers new products to respond to market trends.

3.017

The carrier provides consistent and stable markets.

3.214

The carrier provides competitive pricing.

3.025

The underwriter(s) is accessible.

3.255

The carrier's underwriter(s) has sufficient knowledge and training.

3.437

My underwriter(s) is flexible when warranted.

3.002

The carrier's underwriter(s) responds within an acceptable time frame.

3.225

The carrier's underwriting guidelines are clear and comprehensive.

3.349

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K E Y F I N D I N G S B Y C AT E G O R Y & Q U E S T I O N S

Policy Service & Claims Respondents were the most satisfied with their carriers in the category of Policy Service and Claims, as this classification continued to receive the best average score. New to this survey were two statements.

The first asked members for their satisfaction with the carrier’s promptness to endorsement requests, and the second on the carrier’s effectiveness with communicating with the agency during the claims process.

2013

3.367

2010

3.384

2008

3.377

2006

3.340

2004

3.107 1.000

2.000

3.000

4.000

The carrier has prompt policy issuance.

3.331

The carrier responds promptly to endorsement requests.

3.238

The carrier has accurate policy issuance.

3.521

The carrier offers convenient payment plans.

3.602

The carrier adjusts claims promptly (within 24 hours).

3.430

The carrier adjusts claims fairly.

3.503

The carrier provides effective loss control service.

3.266

The carrier effectively communicates with my agency and customer throughout the claims process.

3.100

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K E Y F I N D I N G S B Y C AT E G O R Y & Q U E S T I O N S

Technology As with previous surveys, technology remained the area in which respondents expressed the greatest degree of dissatisfaction with their carriers. There were no changes to the survey statements in this category.

2013

2.793

2010

2.793

2008

2.774

2.674

2006

2.537

2004 1.000

18

2.000

3.000

4.000

The carrier's technology is reliable (up-time).

3.294

The carrier uses technology effectively with my agency.

2.933

The carrier supports upload/download with my agency management system.

2.931

The carrier has invested in and is committed to Real Time.

2.785

The carrier's use of Real Time has provided opportunities for my agency.

2.607

The carrier's technology initiatives provide my agency with an ease of doing business.

3.025

The carrier's web-based services are easy to use.

3.126

How satisfied are you with the company's use of technology and any workload shifting?

2.737

The carrier provides technical expertise for my agency.

2.873

The carrier seeks agent input during the planning process of its technology initiatives.

2.307

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K E Y F I N D I N G S B Y C AT E G O R Y & Q U E S T I O N S

Agency/Company Relationship In the category of agency/company relationship, respondents’ satisfaction decreased slightly from 2010 after three consecutive years of increases. Several new statements were added. Included for the first time were statements relative to the carrier’s marketing initiatives supporting the Independent Agency System, the carrier’s communications being clear and timely and, finally, a statement asking respondents to rate their satisfaction with any shift in responsibilities that were once the carrier’s to the agency.

3.164

2013

2010

3.207

2008

3.194

3.151

2006

2.953

2004 1.000

2.000

3.000

4.000

The carrier is committed to the Independent Agency System.

3.430

The carrier's marketing initiatives support the Independent Agency System.

3.249

The carrier offers a good commission schedule.

3.281

The carrier offers a good profit sharing plan.

2.916

The carrier has clear and timely communications.

3.196

The carrier provides assistance programs for producer hiring, growth plans, etc.

2.584

The carrier has shifted responsibilities and functions to my agency.

2.678

I have confidence in the carrier's future direction.

3.289

I have confidence in the carrier's management.

3.209

This carrier appears to be financially stable.

3.599

This carrier has a strong position in my agency’s future plans.

3.361

I would recommend this carrier to a peer as a good company.

3.396

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IA&B is an organization dedicated to effectively preserve and advocate the American Agency System as a value-added distribution method, and to the development and availability of programs, products and services that partner with our members and customers in sustaining and advancing their operations.

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