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Complaint Ratios and Property-Casualty Insurer Characteristics


  • James M. Carson
  • Kathleen McCullough
  • David T. Russell


We extend previous research by Doerpinghaus (1991) and others by examining relationships between private passenger auto insurance complaint ratios and insurer characteristics. Consistent with Doerpinghaus, results indicate that insurers with higher complaint ratios are more likely to write high-risk auto coverage. In addition, this study provides evidence that insurers experiencing relatively fewer complaints spend significantly less on legal and auditing expenses and have a larger share of the state auto insurance market under consideration. While the direct writer distribution system is associated with significantly lower complaint ratios in a three factor model, the significance ceases when the model is expanded to include additional insurer characteristics. Results also vary somewhat across the two states examined (Illinois and Oregon), but findings for several variables are consistent across these states. Robustness tests highlight the importance of the complaint ratio definition and the need for consistent complaint reporting at the state level.

Suggested Citation

  • James M. Carson & Kathleen McCullough & David T. Russell, 2005. "Complaint Ratios and Property-Casualty Insurer Characteristics," Journal of Insurance Issues, Western Risk and Insurance Association, vol. 28(2), pages 151-166.
  • Handle: RePEc:wri:journl:v:28:y:2005:i:2:p:151-166

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