MARKETING
DATA-DRIVEN POLICY RENEWAL PROGRAMS
Create four strategies , using basic data , for a more educated and thoughtful renewal discussion
By : Keagan Henson
In every industry , customer acquisition costs are high , and insurance is no different , if not even higher . Agency owners understand that decreases in customer retention need to be overcome by adding new customers . Building a strategy to increase customer retention while continuing to drive new business customer acquisition enables an agency to increase organic growth and profitability . An increase in retention helps build more customer loyalty and provides an opportunity to expand your business . This growth can be driven more efficiently and consistently if the retention numbers remain steadily higher than industry averages .
Agencies run regular programs and campaigns to achieve their retention objectives , making them smarter and more useful by enabling them with data-driven inputs . The simplest method is to run reports of when policies are due for renewal and when to contact those clients . With the advent of advanced predictive models , agencies can now predict if a client is likely to renew or not , and how to support or alter that outcome .
STRATEGY A : SIMPLE CLIENT EXPIRATION REPORTS This strategy is employed by most agencies using reports from their Agency Management Systems , tabulating the active policies due for renewal in the current book of business with the following information at a minimum :
1 . Client Name 2 . Policy Number 3 . Current Premium
4 . Renewal Date 5 . Total Count of Policies 6 . Total Premium Across All Policies 7 . Renewal Premium for Policy ( if available )
These reports are typically run by department or line of business with policies due for renewal within a specified period . They can be created at regular intervals for targeted communications . Within these reports , records can be sorted using specific parameters like “ Total premium across all policies ” and “ Total counts of policies ” to enable prioritization for reaching out . The renewal time window for communications can be specific to a business line , e . g ., commercial lines renewal window could be three months , while personal lines could be one . Using data will help you target the right clients with the right message at the right point in time .
STRATEGY B : CLIENT SEGMENTS AND SPECIAL TREATMENT
Basic analytics can be used for a book of business to identify the average premium per policy for personal and commercial lines clients . You can then use these average values as a threshold to segment clients into VIP and regular clients . This process provides four client segments :
Personal – VIP Personal – Regular Commercial – VIP Commercial – Regular
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