Insurance Scorecard That Guarantees Success

Running an insurance business is never easy at all. Like any trade, owners of insurance companies need to implement strategies to improve their sales. They should continually find ways on how to lure possible clients, yet able to maintain old ones. An insurance scorecard is a helpful tool to guide owners on their way to success.

You might wonder why scorecards are essential. This is because you will never know whether a specific program or business succeeds if you do not have means to measure its success. Many companies use this tool and insurance firms are not an exception. Below are six performance indicators that an insurance company must focus to make success within reach.

First is policy sales. This is regarded as the most basic yet also highly important. Remember that the aim here is to increase policy sales. The management must find ways to improve figures of sold policies continually. One thing that can be done is to give employees proper training on how to hunt possible clients. Customer service is the key here. Employees should learn how to deal with clients in such a way that they will be pleased with the services of the company. Take note that a decrease in policy sales is not a good sign. It will only imply a long-term problem for the insurance firm.

The second indicator is still related to policy sales - ratio of policies. As an owner, always see to it that you get a figure on the ratio of renewed policies against the accumulated sold policies. This is relevant for the company, especially when it decides to implement some changes while updating clients, both old and new ones. Likewise, having this data will give the management an idea of the policy that results to remarkable sales.

Missed payments is the third scorecard. It must be noted that customer contribution also needs to be monitored. Lapses in payments may lead to foreclosure of their policies. This scenario is not good for the company. As much as possible, insurance firms would want to avoid foreclosures, as such is contrary to its aim of keeping clients.

The Fourth performance indicator pertains to lapses or missed payments. The only difference is the existence of a restriction. Here, the tracking must fall within the first two years of the client usage of the policy.

Quota is the fifth indicator. This is important, as such will dictate the direction of the company. Management should impose quota to its agents and collectors. This way, owners can assess the effectiveness of its employees. Likewise, targeting desired sales figures and reaching these can name success for the insurance firm.

The sixth and last metric to be included on the scorecard is total paid benefits. The management must be able to determine the premium percentage through total paid benefits. Having this data is vital, as it will help assess the overall performance of the company.

Take note, however, that the above-mentioned indicators are only among the common metrics included on the insurance scorecard used by successful companies. This means that there are still many options on how to assess the performance of insurance firms. What is important though is to understand that performance indicators are crucial for success.