The Stunning Economics of Policyholder Retention

Precisely reveals how P&C carriers can boost retention and improve profitability in 2023 and beyond.

Losing customers is an uncomfortable fact of life in any business, but it can be particularly stark in insurance. While the very best performers might claim to have a near perfect policyholder retention rate, the average personal lines carriers loses about 13% of its policyholders each year. For some, it’s even more challenging, with a high-profile insurtech recently reporting that it churned approximately 45% of its policyholders in its renters book, in each of the previous three years1. When you translate that to organizations with billions of dollars in premium, there are some very large numbers at stake especially when you consider the compounding effect over time.

There are many reasons why policyholders don’t renew their policies, such as a change in their personal situation where they don’t need the coverage anymore, a poor customer experience or a large increase in premium that encourages them to switch carriers. But whatever their reason, the $10+ billion that U.S. insurers spend on advertising each year encouraging policyholders to shop around, amplifies the impact that non-renewals has on carriers, particularly the smaller ones that cannot compete with that level of ad-spend.

This whitepaper discusses the impact that advertising and non-renewals has on mid-tier carriers and offers a solution that allows carriers to boost their policyholder retention rate.  Read more.