Persistency Management Analytics for
Profitability of insurance business is largely dependent on renewal of policies. This is not only in terms of immediate repeat revenues (premiums) from an existing customer but also in terms of maintaining a brand reputation of being the product of choice for the consumer. Look at the below Persistency Management Scorecard dashboard:
Here are GrayMatter‘s 7 effective ways to Improve Persistency in Insurance Industry
- Demographic profiling: Analyzing persistency of customers by occupation, age group and income group to determine target customer segment to be focused upon for persistency.
- Premium payment behaviour analysis: Strategic insights around factors affecting premium payment behaviour and drill down to major reasons for lapse. Take corrective measures to address these lapse reasons.
- Analysis by Product Type: Analyzing persistency by product type to understand if a particular category e.g., health insurance has greater or lower persistency versus others. Based on this analysis focus on high importance products that have a greater chance to lapse.
- Persistency trend: Persistency percentages tracked over time duration’s like 6 month persistency, 13th month persistency, 25th month persistency along with comparison with corresponding numbers for previous year to get a trend on persistency and duration after which lapse is more likely.
- Company performance assessment: Tracking persistency by region, division and branch to identify dips in performance and take corrective actions to improve persistency.
- Analysis by premium payment frequency: Tracking and analysing persistency percentages by different frequencies of premium payments e.g., monthly, quarterly, annual etc. to determine if lapse is more likely for a particular payment frequency and take corrective actions in response.
- Analysis by policy tenor: Tracking and analysing by tenor of policy like 5 years, 10 years, 20 years etc. to determine if lapse is more likely for a particular payment tenor and take corrective actions in response.
GrayMatter’s Insurance Analytics Solution consists of ready-made analytics for all of the above and more.
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