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Letter to the Editor

February 2010 Issue

Who Pays for What?

INSIGHT sees some interesting changes in the 2010 results of our annual survey of how top insurers pay - or don’t pay - for non-included P-page items.

The results for INSIGHT’s 2010 “Who Pays for What?” survey, included in the January issue, are in. There are some interesting changes this year from the past years.

The data from the returned surveys has been compiled into charts separated by the seven major insurance companies. The charts show payment for 36 of the most common non-included P-page items. How-ever, an overall average of the responses is also included for comparison.

The “never pay” percentage has been on a roller coaster ride since 2007. In 2007, it dropped to 40.7 percent. However, in 2008, the “never pay” percentage jumped up to 46.8 percent, making 2008 the highest for “never pay” since 2001. The “never pay” percentage for 2009 went down to 43.6 percent. This year, the 2010 “never pay” percentage is back down to the exact same percentage as in 2007 – 40.7 percent. All of these are an improvement from when INSIGHT first began this survey. In 1997, the average “never pay” percentage was 51.3 percent.

The “sometimes pay” percentage has also gone up and down over the past few years. Over these years, however, it stayed right around 30 percent. The “sometimes pay” percentage increased slightly from 2008 to 2009. In 2008, the “sometimes pay” percentage was 31.2, and in 2009 it was 31.3 percent. The 2010 “sometimes pay” percentage went down to 26.6 percent.

The “always pay” percentage is up this year. The average “always pay” is up to 32.7 percent. This is a big improvement over last year’s “always pay” percentage of 25.1 and from 2008’s 22.0 percent. In fact, this makes 2010 the highest “always pay” percentage year ever. This title used to belong to 2002 when the average “always pay” percentage was 30.3 percent. Keep in mind, too, that when INSIGHT first began this survey in 1997, the average “always pay” percentage was only 21.7 percent.

The “always pay” percentage is up for all the insurers this year. In particular, Allstate and GEICO showed great improvement in this area. Each scored their highest “always pay” percentages this year. Allstate had a 23.8 percent “always pay” percentage in 2009. This year, Allstate’s “always pay” percentage was 35.5 percent. GEICO had a 21.0 percent “always pay” percentage last year. It went up to 38.9 percent for 2010.

Farmers, Nationwide, Progressive, and USAA all had improvements in their “always pay” percentages. Last year, Farmer’s “always pay” percentage was 19.8. It went up to 26.1 percent this year. This is the highest it has ever been for Farmers. Nationwide’s “always pay” percentage was 25.9 percent. This year, Nationwide’s “always pay” percentage is up to 32.8 percent, which puts the insurer just above the average. Progressive’s “always pay” percentage was up from 18.8 percent in 2009 to 24.4 percent this year. USAA showed the least improvement in this area. Last year its “always pay” percentage was 26.4. However, this year it only went up to 27.1 percent.

Last year, USAA was second to only State Farm in this area. Now, GECIO, Allstate, and Nationwide have pushed USAA into fifth place.

State Farm’s “always pay” percentage has improved over the years. In 2008, State Farm’s “always pay” percentage was down to 32.8 percent from 41.7 percent in 2007. In 2009 it went back up to the forties, with a 40.2 percent “always pay” percentage. This year it went up again to 44.4 percent. However, this does not come close to State Farm’s “always pay” percentage high in 2006 of 48.8 percent. Despite all this, State Farm still has the highest “always pay” percentage.

Interestingly, State Farm is the only insurer to have an increase in its “never pay” percentage. State Farm’s “never pay” percentage is up from last year. In 2009, State Farm’s “never pay” percentage was 34.0 percent. This year it went up to 37.7 percent. All other insurers had a decrease in “never pay” percentages, even Progressive. Its “never pay” percentage went down very slightly from 52.6 percent to 52.4 percent.

State Farm, GEICO, All-state, and Nationwide are all above the overall “always pay” percentage of 32.7 percent. USAA, Farmers, and Progres-sive, are all below the overall “always pay” percentage. Progressive comes in with the lowest “always pay” percentage of 24.4 percent, but Farmers and USAA are not much higher with “always pay” percentages of 26.1 and 27.1 percent respectively. State Farm is still the highest with 44.4 percent.

Three insurers had higher than average “never pay” percentages, and four had lower than average “never pay” percentages. USAA, Nationwide, State Farm, and GEICO are all below the overall “never pays” percentages. Progressive, Farmers, and Allstate all had “never pay” percentages that were higher than the overall average. Progressive still has the highest “never pay” percentage of 52.4 percent. However, State Farm no longer has the lowest “never pay” percentage. This title now belongs to USAA, with a “never pay” average of 33.3 percent.

The statistics above almost always reflect the shops’ satisfaction with the insurance companies. The “always pay” and “never pay” percentages are usually in direct correlation with CSI scores. However, this year, all of the CSI scores are the same even though some “always pay” percentages have gone up and some “never pay” percentages have gone down. Progressive has the highest “never pay” percentages, and the lowest “always pay” percentages. Therefore, Progressive still has the lowest CSI rating of 41 percent. (Note: Progressive’s 34 percent in 2008 is still the lowest CSI score ever in the history of the “Who Pays for What” survey.)

With an increase in both the “always pay” department and in the “never pay” department, State Farm’s CSI did not go up, but it also did not go down. State Farm’s CSI score stayed the same at 78 percent. Although this is again the highest CSI rating this year, it is still significantly down form its highest rating of 93 percent in 2005.

There were some surprises in the 2010 results of the “Who Pays For What Survey?” GEICO, Allstate, and Nation-wide had significant increases in their “always pay” percentages. State Farm had an increase in its “never pay” percentage. Progressive’s “always pay” percentage climbed back up to the 20s despite still having a 52.4 “never pay” percentage. Last but not least, all of the CSI scores remained the same as last year.

INSIGHT would like to thank all of those that participated in the “Who Pays For What Survey?” Your responses are greatly appreciated. o

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