Small Businesses Are More Satisfied With Their Commercial Insurance Than Ever

Small businesses in the US rating the service they are currently getting from their commercial insurance providers very highly.

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According to the JD Power 2023 Small Commercial Insurance Study, survey respondents reported a customer satisfaction level of 84.7%, which is up half a point from last year and is the highest overall customer satisfaction rating in the 11 years during which this study has been conducted. These rising satisfaction levels are especially significant given some of the obstacles that many businesses have been encountering over the last few years, including the highest interest rates of the last two decades. 

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The survey collected responses from representatives of nearly 2,500 small businesses around the country that have fewer than 50 employees and determined that customer satisfaction had increased across practically every metric evaluated - including claims, cost, and interaction - which were all areas of particularly high customer satisfaction. 

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Some of the most significant findings and important takeaways contained within the report include:

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• Improved Customer Satisfaction. Over the last 10 years, customer satisfaction with commercial insurance companies has increased by 7%, though the growth rate is slowing a bit with only half of a point increase last year alone. 
• Company Size Correlates to Satisfaction: Companies on the larger end of the small business spectrum (11 to 50 employees) reported a higher level of customer satisfaction (85.7%) than medium-sized small small businesses(5 to 10 employees) which reported 85.5% satisfaction, or the companies on the smaller end of the small business spectrum (1 to 4 employee) at 82.3%.
• Price Increases Can Increase Price Satisfaction: Respondents report a net increase in price satisfaction even in the wake of price hikes when carriers proactively communicate information about upcoming pricing changes in advance. Further, policyholders that proactively work with agents to make cost-saving adjustments to their policies in the wake of price hikes report an 8.5% increase in price satisfaction while policyholders that make risk-reducing changes to their business operations in response to price increases report a 13.5% satisfaction increase in their price satisfaction. 
• Social Media Linked to Satisfaction: Micro-businesses that followed their carrier via social media platforms reported 8.8% higher satisfaction than companies that did not follow their insurer’s social media account(s). 

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Clearly, small businesses are pleased with the coverage and service they are receiving from their insurance carriers for the most part, despite some of the challenges that the industry and business in general have been forced to overcome in recent years. 

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On one hand these results reflect a challenge for insurance brokers, agents, and representatives to meet these standards and to grow their business among high-performing competitors, while on the other hand any policy-holding company that is less than satisfied with their insurer is also reminded of the service they could be getting if they seek a new carrier elsewhere.

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The report also evaluated the overall performance of several prominent insurance companies, weighing a number of different factors, and ultimately positioned Nationwide at the top of the list with an 88.3% customer satisfaction score, followed by State Farm at 87.7% and Cincinnati Insurance at 87.0%.

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You can read more about this study and analysis here. 

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