Zurich has topped a new customer satisfaction survey of home and car insurers, while Norwich Union – ironically the UK’s biggest financial provider – has come last.
The UK National Customer Satisfaction Index (NCSI-UK) gave Zurich a ranking of 79 on a scale of 0-100. The survey was launched mid-year by the US-based customer satisfaction measurement firm CFI and analysed the experiences of almost 1,500 policyholders.
Scores were given for general customer satisfaction, customer expectations, quality perception, value perception, the number of customer complaints and policyholders’ loyalty.
Zurich’s score of 79 secured it first place in the rankings, ahead of 77 for the combined Direct Line and Churchill Group. Separately Churchill scored slightly higher with 78, and Direct Line slightly lower at 76. More Th>n came fourth with 74 points.
Aside from the five biggest home and car insurers, others were measured under an ‘All Other’ category. The UK index used the same testing methods as CFI’s sister survey in the US, the American Customer Satisfaction Index. Overall, the customer satisfaction level in the UK came out slightly lower than its US counterpart at 77, with the US recording an aggregate of 80 points.
In the US, the survey is widely respected as a barometer of corporate performance and financial health. CFI’s chief executive officer, Sheri Teodoru noted that competition between insurers in the UK was “intense”, with price comparison websites only adding to the pressure on insurers to keep their prices low.
But she said there was reliable evidence to show that there was a direct correlation between a company’s customer satisfaction record and its market performance. Research in the States has shown that companies that did well in terms of customer satisfaction performed better overall by an average of 40 percentage points. She said that insurers simply could not afford to ignore the figures.
The index also threw up some surprises, not least the fact that Norwich Union came last for customer satisfaction, in spite of having the biggest market share. Analyst Patrick Barwise said the company needed to learn from the survey’s results, if it was to retain its market leadership.
In spite of the heavy emphasis put on price in the press, 67% of those polled had been with their insurer for over a year. The relatively high percentage seems to indicate that trust, loyalty and service can prove to be just as important as price in maintaining a strong customer base.
For those looking to switch Direct Line was the most tempting alternative. The company also came second in terms of existing customers’ loyalty. But despite coming second for customer satisfaction, Churchill came last in terms of retention, having the lowest number of customers who had been policyholders with the group for over a year.
On a positive note for the industry, complaints were relatively low at 6% overall. Royal and Sun Alliance, trading under the More Th>n brand, came out worst, with the lowest score for customer service and the highest number of complaints (9%).
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