JD Power Survey: Homeowners Seek Alternatives Amid Rising Insurance Premiums

Homeowners insurance rates have risen significantly over the past year, with 47% of homeowners experiencing at least one rate increase. High lifetime-value customers, those with higher annual premiums, are most likely to start shopping for alternatives. Insurers can improve customer satisfaction by communicating the reasoning behind rate increases and offering options. Amica, Chubb, and Erie top the customer satisfaction rankings.

Homeowners insurance premiums have surged significantly over the past year, with nearly half (47%) of U.S. homeowners experiencing at least one rate increase, according to the J.D. Power 2025 U.S. Home Insurance Study Homeowners Insurance Premium Increases Threaten Customer Loyalty, Long-Term Profitability, J.D. Power Finds^[1]. This trend is particularly pronounced among high lifetime-value customers, who are more likely to switch insurers due to repeated price hikes.

The study found that 43% of customers who experienced a premium increase and are unlikely to renew cited the recent price hike as the reason for switching. High-value customers, defined as those with higher annual premiums and multiple insurance products, are particularly sensitive to rate increases. Among those unlikely to renew, 45% of high-value customers cite multiple price increases as a key reason for switching carriers, compared to 30% of low lifetime-value customers Homeowners Insurance Premium Increases Threaten Customer Loyalty, Long-Term Profitability, J.D. Power Finds^[1].

Insurers can mitigate the negative impact of rate increases by proactively communicating the reasons behind them and offering options to help customers lower their premiums. When insurers clearly explain the reason for a rate increase and provide options, overall satisfaction among customers who experience a rate increase averages 721 out of 1,000, significantly higher than the average satisfaction among those who do not understand the reason or are not presented with options Homeowners Insurance Premium Increases Threaten Customer Loyalty, Long-Term Profitability, J.D. Power Finds^[1].

In the homeowners insurance segment, Amica ranks highest in customer satisfaction with a score of 705, followed by Chubb (677) and Erie Insurance (676) Homeowners Insurance Premium Increases Threaten Customer Loyalty, Long-Term Profitability, J.D. Power Finds^[1]. Amica also leads in the renters insurance segment with a score of 711, while Erie Insurance ranks second and CSAA Insurance Group (AAA) ranks third Homeowners Insurance Premium Increases Threaten Customer Loyalty, Long-Term Profitability, J.D. Power Finds^[1].

To address the challenges in the claims process, Venbrook Group and Cognizant have partnered to modernize claims processing for insurance carriers. The collaboration includes an AI-powered Third-Party Administrator (TPA) solution that aims to digitize key components of the claims process, increase accuracy, and reduce operational costs Venbrook and Cognizant Partner to Modernize Claims Processing for Insurance Carriers^[2]. This partnership underscores the industry's shift towards leveraging advanced technologies to enhance efficiency and customer satisfaction.