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Study Shows Buyer Satisfaction Better When Local Agent Plays a Role

A new industry study says that buyers who purchase their auto insurance policies through local agents give significantly higher average satisfaction scores compared with those...
July 22, 2008

A new industry study says that buyers who purchase their auto insurance policies through local agents give significantly higher average satisfaction scores compared with those who purchase policies from call center representatives or via Internet channels.

The study examines the purchase behaviors and overall satisfaction of buyers who shop for a new auto insurance company. Three key factors are measured to determine overall satisfaction. In order of importance, they are: distribution channel (50 percent), price (29 percent) and policy offerings (21 percent).

"Buyers who use insurance agents are also more likely to purchase bundled auto and homeowner insurance policies," said Jeremy Bowler, senior director of the insurance practice at J.D. Power and Associates, who conducted the recent J.D. Power and Associates 2008 Insurance New Buyer Study.

The study also finds that while 55 percent of all new auto insurance sales are handled by local agents, the percentage of buyers shopping and closing via direct channels -- which includes insurer Web sites and call centers -- has increased from the 2007 study. In 2008, 44 percent of buyers who bought auto insurance from a new insurer purchased directly from the insurer, rather than through an agent -- an increase of 3 percentage points from 2007. Additionally, among buyers who changed their shopping channel, more buyers changed to direct purchasing methods (22 percent) compared with those who switched to using an agent (15 percent).

Buyer Satisfaction Better With Local Agent  (Insurance Journal 7/15/08)

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