When it comes to why consumers switch auto insurers, research shows that poor service is as big a factor as price. So, auto insurers beware! Of course, auto insurance companies will do just about anything to lure drivers away from their long-time insurer with promises of much lower rates and better service. But, according to the latest study, customers who switch auto insurance because of what they believe were poor services soon regret their decision, as they often have to pay much higher premiums to their new insurer.
In a J.D. Power 2014 U.S. Insurance Shopping Study, consumers state that after switching, their main dissatisfaction with their new insurer was the gradual decline in savings. Meanwhile, the auto insurance industry spends billions in advertising dollars every year to convince customers to switch to them and receive huge savings…usually several hundred dollars annually. Over the last seven years, car insurance ads have predominantly pushed the savings angle. Problem is – while switching to a new insurer will usually result in some initial savings, the promises the ads make don’t always amount to what new customers expected.
It was revealed in the same study that 30% of car owners shopped for new insurance in 2013. Of those, 36% eventually changed from their current insurance company to a new carrier. And, drivers facing a potential premium increase shopped much less for new insurers with a 13% rate – compared to customers who spoke of a poor experience as the reason for the switch at 28%.
Interestingly, the fact is – a possible rate increase didn’t significantly impact the number of those switching to the same extent poor experience and service appeared to. However, the study did show that a rise in rates of more than $200 can increase the total number of drivers switching insurers by as much as three times.
But, in the end, it all comes back down to price when setting major criteria for selecting a particular insurance company over another. Per the survey, 8 out of 10 drivers choose insurers with the lowest price. Although, in the long run, the cheapest doesn’t always mean the best…cost is still a determining factor in the selection process.
Keep in mind that – any way you look at it – you’ll need auto insurance. If you’re considering moving on to greener pastures for something you don’t like about your present insurer, study your options carefully. Take the time to review potential insurance companies before jumping ship. Choose a company you feel comfortable with as well as one that will stick by what they claim or promise you. Once you make the switch, if you discover you may have made a bad choice, you’ll be stuck for a while. At least until you find a more suitable insurer to fit your needs.
Below are the top 10 ranking auto insurance companies by overall scoring of satisfaction of new buyers based on a scale of 1,000 points.
1. Erie Insurance 843
2. MetLife 839
3. State Farm 839
4. Ameriprise 835
5. American Family 835
6. The Hartford 834
7. Liberty Mutual 833
8. Automobile Club Group 827
9. Esurance 826
10. Auto Club of Southern California 825
If price is important to you when choosing an auto insurance company…make sure you’re getting the best rate on your auto insurance. Why not get a free auto insurance quote today?
Have you just switched your car insurance company recently? Feel free to share your thoughts in the comments section below.