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J.D. Power and Big ‘I’ Study: Agents’ Carrier Relationships in Hard Market

In the current hard market environment, independent agents are proactively shopping ahead for their clients more than they have in the past.
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j.d. power and big ‘i’ study: agents’ carrier relationships in hard market

In 2023's hard market environment, independent agents are proactively shopping ahead for their clients more than they have in the past, according to the J.D. Power 2023 U.S. Independent Agent Satisfaction StudySM conducted in alliance with the Big “I."

For the sixth year in a row, the Big “I" and J.D. Power teamed up to measure property-casualty independent agent perceptions of their carriers and more.

Fifty-seven percent of personal lines agents are shopping ahead for clients more than they were two years ago, and 52% of commercial lines agents indicated they were proactively shopping. Premium increases are the main driver behind the increased shopping. Other reasons include product coverages, customer service and claims experiences.

Independent agent satisfaction rates with personal lines carriers are driven by support and communication, and satisfaction rates with commercial lines carriers are determined by the quality of quoting abilities and product offering and risk appetite, according to the report.

If prices and coverages are comparable, ease of quoting and risk appetite alignment are the primary reasons agents place business with a carrier. And the most impactful satisfaction key performance indicator (KPI) for both personal and commercial lines carriers is that they are “completely flexible during the design/onboarding of policies." However, only 48% of personal lines agents and 35% of commercial lines agents say the carriers they work with meet this KPI.

With recent years' mergers & acquisitions (M&A) levels creating larger agencies, the report commented that ongoing M&A was also prompting agencies to join alliances to gain more advantages in the market. Agents who are part of an alliance generally report higher satisfaction with their carrier relationships. However, agents who are part of the largest alliances, those with $50 million or more in revenue, are less satisfied with carriers than agents who are part of smaller alliances.

“Independent agents are key members of our country's insurance distribution system, and the report shows they value the support and communication that their carrier partners can provide, as well as greater offerings and appetites to help their clients weather the challenges of the current hard market," says Jennifer Becker, Big “I" senior director of agent development, research and education. “As independent agencies continue to deal with the difficult conditions brought by catastrophes, inflation and rising claims costs, we urge carriers to provide transparency, proactive communication, and a willingness to work with independent agents to provide solutions to our customers' coverage needs." 

The survey was conducted among independent agents in May and June. The top personal lines insurers for agent satisfaction scores are Auto-Owners Insurance, Erie Insurance, Progressive and Safeco/Peerless. The segment average was 774 out of 1,000.

The top commercial lines insurers are Auto-Owners Insurance, Cincinnati Insurance, The Hartford, Travelers, Progressive, Liberty Mutual, Zurich and Markel. The segment average was 762 out of 1,000.

AnneMarie McPherson Spears is IA news editor. 

Thursday, November 2, 2023
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