During the pandemic, a toxic combination of business disruption and economic uncertainty strained the relationship between small businesses and their commercial lines insurers, causing customer satisfaction to fall for the first time in seven years beginning in 2020. That trend has reversed, according to the J.D. Power 2022 U.S. Small Commercial Insurance StudySM, which was released today, with overall small business customer satisfaction rising 13 points (on a 1,000-point scale) to just 2 points lower than its pre-pandemic high.
“It’s noteworthy that we’re seeing increases in satisfaction across all factors—including price—at a time when 30% of small business customers have experienced an insurance premium increase,” said Stephen Crewdson, senior director of global insurance intelligence at J.D. Power. “That’s the highest proportion of customers experiencing price increases that we’ve seen in the past eight years. Insurers that notify their small business customers in advance of a price increase and proactively work with them to mitigate the financial effects of those premium increases are finding that it is possible to drive strong customer engagement and high levels of customer satisfaction even in a difficult economic environment.”
The following are some of the study’s key findings:
• Customer satisfaction rises after a dip during the pandemic: Customer satisfaction with commercial insurers among small businesses is 842, up 13 points from 2021. Customer satisfaction improves across all factors in the study, with interaction, billing and payment, and policy offerings leading the way. From 2013 until the pandemic, customer satisfaction with commercial insurance increased steadily, reaching an all-time high of 844 in 2019.
• Smallest small businesses are less satisfied: While overall customer satisfaction improves across all business categories studied, the micro category (those with fewer than five employees) has a lower overall satisfaction score (826) than medium-size (841) and larger (852) small businesses.
• Proactive communication about premium increases has an impact on customer satisfaction: Despite a 30% increase in premiums, customer satisfaction with the price of their small business insurance policies rises 3 points this year. According to the study, proactive communication plays a significant role in this trend. Customers who are notified in advance of an increase, discuss ways to mitigate the effect of the increase, and fully understand why their premiums increased are nearly as satisfied with price as customers who did not have an increase at all.
Study Ranking
State Farm has the highest overall customer satisfaction score of 856. Chubb (855) comes in second, and Nationwide (854) comes in third.
The responses of 2,254 small commercial insurance customers were used to create the 2022 U.S. Small Commercial Insurance Study. The 10-year study looks at overall customer satisfaction among small commercial insurance customers with 50 or fewer employees. Billing and payment; claims; interaction; policy offerings; and price are the five factors that contribute to overall satisfaction (in alphabetical order). The survey was conducted from March to June 2022.