JD Power: Satisfaction with Homeowners Insurance Property Claims Hits Low Amid Record Catastrophic Events

More catastrophic weather events last year led to longer timeframes between steps in the claims processes, delivering a big hit to customer satisfaction, a new report shows.

The J.D. Power 2024 U.S. Property Claims Satisfaction Study out this week shows satisfaction with the claims process dropped to the lowest level in seven years.

It essentially blames the weather.

The report calls out the 28 catastrophic weather events in 2023 that each caused more than $1 billion in damage, which led to a larger number of high-severity claims and longer time frames for all major steps of claims: estimating damage, customer payments and completing work.

“We’re seeing many more incidences of these longer-tailed claims,” said Mark Garrett, director of claims intelligence at J.D. Power. “Those get customers frustrated.

It turns out that two weeks after filing a claim maybe OK, but at around three weeks out, customers start getting unhappy.

“That’s where we see the break point,” Garrett said.

The number of large weather events in 2023 jammed up claims processes for everyone, as claims handlers were dealing with smaller claims and larger cat claims that often take multiple-weeks or months to handle, he added.

“The cat claims slow up the entire department, he said.

Key findings of the 2024 study include:

• The average claims cycle time, from reporting the claim to finished repairs, grew to 23.9 days, more than six days longer than what was reported in the 2022 study.
• Many customers experienced rising insurance premiums, so when they had a claim and needed to cover $1,500 or more in costs, satisfaction was negatively affected, even if it is to cover their deductible. Policies often have higher deductibles for catastrophic weather, so as these events increased in frequency, more customers may have been paying higher deductibles. J.D. Power saw a five-percentage-point increase to 28% from 23% in 2022 among those spending $1,500 or more for either their deductible or out-of-pocket expenses, and satisfaction has declined 27 points among this group during that period.
• Customers who used digital tools for reporting their claim and submitting photos tended to have lower severity claims and report notably faster repair cycle times of 15 days, on average. This compares with nearly 28 days among non-digital users. So, while the process is notably faster for digital users, the expectation is that it should even be shorter—those who state the process took as long as expected say they had an average repair time of only 11 days.

Amica ranked highest in property insurance claims experience with a score of 906 on the 1,000-point scale. AIG (889) ranked second and Erie Insurance (888) ranked third. The rest of the top 10 were: Farmers (883), American Family (877), Nationwide (877), Chubb (876), State Farm (873), Auto-Owners Insurance (869), and Liberty Mutual (869).

The study measured satisfaction with the property claims experience among insurance customers who filed a claim for property damages by examining five factors in order of importance: settlement; claim servicing; FNOL; estimation process; and repair process. The study is based on responses from 6,019 homeowner insurance customers who filed a claim within the previous nine months.