Challenges with Customer Retention
Globally, insurers lose 18-20% of their customers annually. Insurance companies have taken various initiatives to improve retention rates, but the problem remains deep-rooted with no quick fix solution. It is a complex issue dictated by a combination of factors. Some of these include the macroeconomic environment, product parameters, demographics, payments, etc. Unfortunately, there are no best practices documented for retention control.
Data Analytics to Boost Retention in Insurance
The key to effectively arrest lapsation lies in leveraging the knowledge that is already available regarding the customer base. However, the key disconnect occurs in using the underlying information optimally and in real-time. Data analytics, specifically that which incorporates both structured and unstructured data and combines customer and distribution level interaction has the potential to impact retention in insurance.