Volume 14, Issue 2 - March/April 2012

Insurance Talk
Policy brief

COMPANY NEWS
Industry Responds to Completion of Allstate Move to Safelite

The move of Allstate’s auto glass claims administration to Safelite Solutions, which took effect at the beginning of this year, has drawn a heated reaction from across the industry. Many have expressed a slowdown in referrals since the January 1 move.

“Last month [January] we did one job, this month [February] we’ve done one job, compared to 16 last February,” said a Salt Lake City-based auto glass shop owner on February 15. “Unless we see more jobs coming soon, we’ll be significantly down this month.”

Most of the agents are telling their customers to go online and file a claim, the owner said. “The online process asks for shop of preference and offers two options, but pushes for Safelite preferred vendors, regardless of how close they are,” he said. “If you click on the other box, it says they’ll call you back. It’s re-slanted toward them. So, nine out of 10 customers will choose a Safelite-preferred shop. We’ve done work for Allstate for 40 years, never have had a complaint, but this is misleading.”

A North Carolina shop owner whose company has gained “Tier-One” status with Allstate has had a similar experience.

“Since January 2, I’ve gotten one job, and that’s because it was a returning customer,” the owner said on February 15. “On average I’d get four to six jobs a week before that.”

The shop owner said he even changed his rate to get more business. “We had to agree to a certain discount amount, which is 44 percent off of the NAGS list price with Allstate,” he said. “I increased my offer to 56 percent discount, but nothing’s changed. I only get a customer when they can’t meet the customer’s timeline. When a customer calls, it says Safelite Solutions. The customer doesn’t know who to use, so they steer him to Safelite shops.”

A Connecticut-based auto glass shop owner says he quickly saw a drop-off in referrals from the Northbrook, Ill.-based insurer shortly after the move took effect.

“Safelite has yet to dispatch a single job in three days, with LYNX I was “Safelite has yet to dispatch a single job in three days, with LYNX I was getting ten jobs a day,” he says. Others say pricing has been an issue since the move.

“Allstate, now through its [third-party administrator] now has the most atrocious pricing in the industry from my standpoint,” says an Arkansas-based shop owner. “ ... Soon Safelite will have all the insurance companies under its thumb and will have to do all the glasswork since the company will be hard-pressed to find any independents to do it.”

A Fort Myers, Fla.-based auto glass business has a different concern. “The majority of the work that [we] receive is from body shops in the area [with whom] he has been working and they have come to rely and trust him with their glass needs,” says the representative, “ but we are not able to install windshields and bill them to Safelite through the body shop.”

“The shop is on [the Allstate] list and approved by the company and is able to do repair and replacement work in the body shops, but has been banned from the installation of windshields because it is a fledgling company, not yet in business a year to be considered an affiliate,” adds the representative.

“I’m scared—I can’t tick these people off anymore,” says the owner of the Fort Myers, Fla., shop. “They’re big—they’re so big, and you’re just a little tiny business.”

RESEARCH NEWS

Use of Call Centers Up, Agents Down, According to New Study
The way in which consumers contact their insurance companies has seen a major shift in recent years, according to the latest Auto Insurance Claims Satisfaction Study conducted by J.D. Power and associates. The study reports that several agency-based carriers are now encouraging customers to contact a call center, rather than their agent, to file a claim.

The study reports that satisfaction was found to be higher among those who filed claims directly with agents; those who filed claims directly with an agent rated the overall claims experience at a score of 886 of 1,000 points during the fourth quarter of 2011, compared with an average score of 849 among those who utilized a call center for the same quarter, according to JD Power.

“Not all customers want to work with an agent; some just want to file their claim in the quickest and easiest way possible, whether that be through a call center or online,” says Jeremy Bowler, senior director of the insurance practice for the research firm. “There still is a significant share of customers who prefer the personal interaction they get with an agent because they value working directly with a person they know.”

Overall, customer satisfaction remained somewhat flat for the year, compared to past studies, averaging 855 during the fourth quarter, compared with 854 during the third quarter and 848 during the second quarter, according to the study.

JD Power reports that New Jersey Manufacturers Insurance Co. and USAA also achieved high scores for customer satisfaction, but are not included in the overall rankings due to the limited markets in which they work.

The U.S. Auto Claims Satisfaction Study is based on more than 3,500 responses from auto insurance customers who filed a claim within the past six months. The study excludes customers with glass-only claims.


AGRR
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