Why do insurance consumers adore Amica Mutual?

Tamara E. Holmes

At Amica Mutual, there’s a whole lot of mutual admiration going on. Customers practically worship the insurance company and vice versa.

In August 2011, a reviewer on Yelp lauded Amica Mutual for its handling of two auto insurance claims. In particular, the reviewer praised the company’s customer service: Amica representatives answer all of his questions, returned calls and even provided an extension number to directly reach one representative by phone. At this point, the reviewer wrote, it doesn’t matter whether Amica’s rates are higher than its competitors’ rates — the policyholder is staying with Amica.

It’s folks like this Yelp reviewer who’ve made Amica the king of J.D. Power and Associates’ customer satisfaction surveys for auto and home insurance.

Robert DiMuccio (right), chairman, president and CEO of Amica Mutual, accepts an award from Finbarr O’Neill, president of J.D. Power and Associates.

Amica reigns in J.D. Power surveys

For the 10th consecutive year, Amica has topped J.D. Power’s U.S. National Homeowners Insurance Study, which measures the satisfaction of buyers of homeowner’s insurance. Amica was No. 1 in J.D. Power’s U.S. National Auto Insurance Study — which looks at consumers’ satisfaction with auto insurance companies — for the 12th consecutive year.

“Amica has consistently delivered very high performance or been evaluated very highly by their customer base” in the auto insurance and homeowner’s insurance sectors, says Jeremy Bowler, senior director of the insurance practice at J.D. Power, a market research company. “They have been very committed to understanding their membership, making sure that they fully meet their customers’ needs for a very long time.”

The J.D. Power survey looks at five areas: policy offerings, price, billing and payment, interaction with the company and the claims process. Amica consistently has scored well in all of those areas, Bowler says.

Recipe for success

So, what’s the secret to Amica’s success?

Although Amica declined to comment for this story, Robert DiMuccio, chairman, president and CEO of the Rhode Island-based insurer, provided some insight into the company’s consumer appeal when he accepted a J.D. Power award in 2010. While the company regularly responds to market changes and adopts new technology, “our core values of service and dedication to our customers” have remained the same for about 100 years, DiMuccio says.

That statement is particularly meaningful, given Amica’s history, Bowler points out. In its earliest days, Amica’s sales strategy was referral-based, meaning all customers were referred by other customers. While that is no longer the case today, “I think in some parts, the legacy of their culture is one of earning your trust so that you’re so pleased with them that you would happily recommend them to friends and family,” Bowler says.

Amica sells directly to customers, but other companies that scored high on the surveys, such as Erie Insurance (tied for second in the 2011 homeowner’s insurance survey and second in the 2011 auto insurance survey), sell their products through independent agents. For such companies, it’s important to make sure those agents buy into the company’s customer service philosophy.

“Our employees work together with independent agents that are empowered to do what they feel is best for our mutual customers,” says Chris Banocy, a spokesman for Erie Insurance.

Pennsylvania-based Erie prides itself on having maintained a consistent level of service since its founding in 1925. “Erie’s founding principle was to provide its policyholders with as near-perfect protection and as near-perfect service as is humanly possible, and doing so at the lowest possible cost,” Banocy says. “That same principle guides our business today.”

Keys to customer satisfaction

For policyholders who are unhappy with their current insurers, it’s important for them to look at how other insurance providers score in many of the areas that the J.D. Power survey examines before switching to another company.

“Shop around, because a lot of states have competitive markets,” says Angel Robinson, consumer advocate for the Iowa Insurance Division. “And in those competitive markets, everybody wants your business.”

Comparing the prices and policy offerings of insurers is only the first step. You also want to get an idea of what your customer experience may be like with various providers and in various situations, such as if you need to file a claim, Robinson says.

You also can ask friends and family members about their experiences with their insurance providers. Another source of information: The National Association of Insurance Commissioners has a database that tracks complaints about insurance providers across the country.

One characteristic of U.S. insurance customers is that they’re extremely loyal to companies like Amica and Erie. “The average renewal rate is just a hair short of 90 percent,” Bowler says. That’s higher than many other markets, including Canada, the United Kingdom, Japan and China, according to Bowler.

But that doesn’t mean insurance customers won’t seek greener pastures.

“If someone is sufficiently unhappy with service, whether that’s a claim experience or what they perceive as a rate increase or billing problem, three quarters of the people who are actually irritated enough to call someone for another quote will keep calling until they find a better offer,” Bowler says. “They’re bound and determined to leave.”