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Customer Survey Knocks Travelers: Low Rank for Auto Insurer May Stem From Merger

Aug 31, 2007

By Nicole Garrison-Sprenger, Pioneer Press, St. Paul, Minn.

Sep. 1--St. Paul-based Travelers Cos. ranks just about last among its auto insurance peers in the latest customer satisfaction study by J.D. Power and Associates.

Out of 25 carriers, Travelers came in fourth lowest with a score of 750 on a 1,000-point scale. Amica Mutual took the No. 1 spot on the list with a score of 837. The study measured customer satisfaction in five areas: interaction, policy offering, billing, price and claims.

Travelers is the 18th largest auto insurance carrier in Minnesota with 1.1 percent of the market, according to data from the company.

"Travelers customer satisfaction is a top priority," said Sheila Trauernicht, a spokeswoman for Travelers. The company recently invested $30 million in a training center for claims adjusters to "provide our customers with the most professional service-oriented expert claims staff in the industry."

Customer satisfaction is a pretty solid predictor of whether clients will renew their policies with a company or not, research from J.D. Power shows. Among customers who indicate high levels of satisfaction with their carrier overall, 88 percent said they "definitely would" renew their policy with their auto insurer. Conversely, only 16 percent of customers who report low levels of satisfaction said they would definitely renew their policy.

Travelers' score is considered a low level of customer satisfaction, said Jeremy Bowler of J.D. Power and Associates. One factor in Travelers' low score could stem from the 2004 merger between the St. Paul Cos. and Travelers Property and Casualty that created the company, Bowler said.

"One of the things we've looked at in the last five years is the way consumers view mergers or shakeouts," he said. "When a company is bought or sold and the consumer gets a notice saying, 'henceforth we'll be known as X,' ... we've seen it has a detrimental effect on the relationship."


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Copyright (c) 2007, Pioneer Press, St. Paul, Minn.

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