What is J.D. Power?
When making decisions on consumer products such as insurance, you want all the help you can get to help you choose the best option for your needs. Companies like J.D. Power and Associates exist to help you make those decisions. It does this by ranking insurance carriers, car makers and others on a range of criteria. Bankrate’s editorial team relies on J.D. Power’s ratings system for unbiased information on each company we review. In this guide, we turn the spotlight on J.D. Power itself to give you a better sense of what the company does and how it can help you make good decisions, whether you’re shopping for a new car, purchasing homeowners insurance or planning your next vacation.
What does J.D. Power do?
According to its website, J.D. Power is a global leader in consumer insights, advisory services and data and analytics. What that means to you is that you can use the company’s vast experience and resources in data collection and analytics to help you build a picture of products in which you are interested, from cars to Medicare. J.D. Power gathers information from thousands of individuals each year to present their highly-regarded rankings and other industry insights.
J.D. Power studies are thorough. In the case of the annual U.S. Auto Claims Satisfaction Study, policyholder respondents are asked about their car insurance claim experience from start to finish, including the first notice of loss, vehicle repair process and return and the settlement process for vehicles declared a total loss, when applicable. With insurance studies in particular, J.D. Power aims to understand the general level of customer satisfaction and provide insurance companies insights into where they can improve.
The bulk of its reports are subscriber-based. Clients include some of the “world’s leading businesses,” who can also pay the firm to design and conduct a custom study. However, J.D. Power does publish and publicly release select insights through the company press room, such as the New Vehicle Demand Forecast.
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Coverage.com, LLC is a licensed insurance producer (NPN: 19966249). Coverage.com services are only available in states where it is licensed. Coverage.com may not offer insurance coverage in all states or scenarios. All insurance products are governed by the terms in the applicable insurance policy, and all related decisions (such as approval for coverage, premiums, commissions and fees) and policy obligations are the sole responsibility of the underwriting insurer. The information on this site does not modify any insurance policy terms in any way.
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Powered by Coverage.com (NPN: 19966249)
Coverage.com, LLC is a licensed insurance producer (NPN: 19966249). Coverage.com services are only available in states where it is licensed. Coverage.com may not offer insurance coverage in all states or scenarios. All insurance products are governed by the terms in the applicable insurance policy, and all related decisions (such as approval for coverage, premiums, commissions and fees) and policy obligations are the sole responsibility of the underwriting insurer. The information on this site does not modify any insurance policy terms in any way.
What is J.D. Power?
Michigan-based J.D. Power is a consumer data and analytics company that has been providing detailed, objective studies on a variety of industries since 1968. J.D. Power has humble beginnings, starting at J.D. “Dave” Power III’s kitchen table. His main focus was to collect consumer sentiment about the automotive industry. His services reached editorial acclaim in the 70s after The Wall Street Journal referenced one of the company’s first independently funded surveys in an article.
J.D. Power began expanding into other industries, although the automotive industry is one of the company’s biggest strengths. Subaru set J.D. Power on the map for the automotive industry in the 80s when it mentioned its J.D. Power rankings during a Super Bowl XVIII commercial.
What is a J.D. Power Award?
J.D. Power began presenting awards in the 1980s. These accolades were introduced to recognize and celebrate excellence in the industries covered by the company based on the consumer satisfaction surveys and research it conducted. Since then, J.D. Power awards have often been mentioned in ads and commercials around the world.
J.D. Power surveys
J.D. Power is popular largely due to its surveys that tap into extremely valuable consumer insights. Companies need feedback from customers to know what works and what needs improvement. However, customers may be hesitant to provide feedback to a company. J.D. Power is experienced at gathering important customer information.
Certain J.D. Power surveys are conducted and released annually. The information contained in the surveys is presented in an easy-to-understand format, making it simple to pinpoint the companies performing well. Companies receive J.D. Power ratings, or scores, ranking them for a particular sect of the market. Depending on the industry, J.D. Power may categorize companies by region. This seems to provide the most accurate analysis since a national company may perform better in one area versus another.
A J.D. Power award or rating is useful to both the companies receiving the accolades and the consumer in search of information. To earn a J.D. Power award, companies are compared based on several focus areas. For example, if you are shopping for a life insurance company, you know that a carrier that ranks high in the Life Insurance Study received high marks in several categories, including policy options, customer communication, pricing and claims process.
Industries J.D. Power serves
J.D. Power conducts market research for multiple industries. Its industry research can even be used to focus on more specific categories, such as homeowners insurance. The various industries J.D. Power conducts research for include:
- Auto: Studies may be focused on the state of the car market, vehicle sales and forecasts, customer satisfaction and more.
- Finance: J.D. Power’s focus on the finance industry includes the growing popularity of fintech, lending and retail banking.
- Insurance: J.D. Power’s annual studies on various insurance industries are invaluable. It covers the automotive, home and life insurance fields.
- Healthcare: J.D. Power conducts studies and data analysis about Medicare and other healthcare topics.
- Travel: The company’s customer satisfaction studies include ratings for airlines, rental car companies and hotels.
Why J.D. Power is credible
J.D. Power studies are considered to be objective because they encompass sweeping data instead of small data sets. Its studies are based on a wide range of responses from consumers nationwide and often include analysis on multiple companies for comparison.
According to its mission statement, J.D. Power values include a goal of being a “truth finder.” Its statement continues, “At J.D. Power, we are proud of the unbiased data and findings we provide. As individuals, each and every member of our team is dedicated to living this same objectivity and embodying the highest ethical and professional standards – the only ‘favorite’ we have is the truth.”
How Bankrate uses J.D. Power
Bankrate often references J.D. Power scores as a barometer of how customers feel about a particular carrier. Similar to J.D. Power, Bankrate collects both quantitative and qualitative data about certain companies and finds ways to classify the information in ways readers can understand and use for comparison. Bankrate may also use customer complaint data from the National Association of Insurance Commissioners (NAIC) and financial strength ratings from AM Best and Moody’s, two top credit-rating agencies.
Some of the J.D. Power annual surveys most widely referenced by Bankrate’s insurance editorial team include:
- J.D. Power Auto Claims Study: The study provides insights from policyholders about which companies handle car insurance claims best.
- J.D. Power Auto Insurance Study: This annual study groups customer satisfaction for different carriers into regions such as New England, Southwest, Texas, California, Florida and more.
- J.D. Power Home Insurance Study: This study provides information about what carriers customers are happiest with when it comes to homeowners or renters insurance.
- J.D. Power Insurance Digital Experience Study: In an increasingly digital world, fully functional mobile apps and glitch-free online policy management portals are essential for some insurance shoppers. The J.D. Power digital experience study gauges how easy it is to do business with carriers online in both the shopping and customer service categories.
- J.D. Power Insurance Shopping Study: Shopping for insurance is not always simple. However, the insurance companies that make this list are among the most successful and innovative at providing a positive experience.
- J.D. Power Individual Life Insurance Study: J.D. Power’s life insurance study gauges customer satisfaction with companies that write life insurance and annuities. The study measures five factors: communication, interaction, price, product offerings and statements, and uses responses from thousands of individuals across the country.
Frequently asked questions
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J.D. Power certification is a rigorous, detailed process that companies undertake to receive this official stamp of approval. Companies must complete a 70+ question application that benchmarks metrics against competitors. There is also a four-day on-site performance evaluation and, finally, a customer satisfaction survey sent to the applying company’s customers. Companies that meet program criteria may display their certification award on marketing and other materials. For consumers, J.D. Power certification indicates a company that excels in its ability to provide quality service to its customers.
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All three of these independent companies offer analysis and rankings to help consumers make better decisions. Each company has its own focus, however, and may look at different industries. J.D. Power, for example, covers a broad range of industries and looks primarily at customer satisfaction. AM Best, meanwhile, is focused solely on the insurance industry and uses company data to determine financial strength. Moody’s works more broadly with corporate finance and is used widely by investors and financial institutions looking to determine financial risk.
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Yes, it is. J.D. Power is an independent company with no ties to a specific industry or company that might keep it from presenting unbiased information. It uses technology and big data to provide insights for both consumers and companies to help them improve their operations and increase customer satisfaction. J.D. Power can offer valuable information to consumers who are involved in decision-making for insurance, vehicles, travel and other purchases.
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