Nobody likes wasting time and money…and yet, insurance carriers present rate quotes for home and car insurance without knowing their real-time competitive premium position.

When an insurance carrier’s quoted premiums are significantly higher than their competitors, the business opportunity is lost, marketing resources are spent needlessly and a negative experience occurs that a consumer and/or agent will remember and share with other potential policyholders.

But all that’s changing for the better. Insurers can now see premium comparisons immediately and use this knowledge to purchase leads, increase sales and provide better customer experiences.

Know Your Competitive Premium Position.

Insurance is a highly competitive business with the lowest rate often winning the business. Given the eye-popping 18 percent jump in the median total cost of home and auto insurance since 2020 paired with today’s gnawing economic unease, consumers are even more price-conscious than ever before. 

Consumers frequently use rate comparison applications or websites to find the best insurance prices. These apps/sites can also provide insurance carriers the ability to see where their premiums line up with their competitors to focus marketing resources and potentially adjust premiums.

If an insurance carrier's quoted premium is within a small percentage of its competitors, they will sell more policies and attract more applicants. On the other hand, premiums that are much higher and out-of-sync with competitors is almost always an instant dealbreaker and can create a bad first impression hurting the carrier's brand in the marketplace. A recent McKinsey article suggests that poor customer experiences are often a primary barrier to purchasing insurance, while insurers with market-leading customer experiences demonstrate stronger revenue growth and lower expense ratios. 

Put simply, the power of pricing cannot be overstated for both winning the business and allocating marketing resources. Here’s how carriers can attract and win more business by making a simple transformative adjustment to their pricing and marketing strategies.

Get it right, in real-time. 

Insurers can now instantly check how their premiums compare to other carriers. They can do this before buying an insurance lead, click, or call. This enables them to intelligently adjust their marketing strategies so they can focus their time and money on the leads where they’re most competitively priced and more likely to win. 

The Solution.

Using non-Personal Identifiable Information rating variables, the Insurance Competitive Position Score (CPS) from Equifax, instantly generates “right-now” premium comparisons against a customized (by you) list of carriers based on state department of insurance approved rates.  CPS returns real-time competitive position metrics that reveal the insurance carrier’s premium’s: 

1. Competitive Position Score ranging from 1 through 4 (1 = worst price and 4 = best price);

2. annual comparison;

3. percent difference from the lowest premium;

4. percent difference from the median premium; and

5. percent difference from the highest premium

By simply knowing where you stand from a pricing perspective, carriers can bid more for leads scored with a 3 or 4 where their premium is at or near the “best position” and bid less or pass on leads with a rating of 2 or below, where their pricing is less competitive. 

This smart, data-driven approach can elevate strategies across the marketing and sales ecosystem by helping insurers: 

• Stand out as a clearly more affordable option

• Create a better, more efficient, and rewarding customer experience.

• Boost sales and cut acquisition costs by focusing marketing resources on high-potential leads. 

• Improve the cross-selling of home and auto insurance policies.

By The Batch!

The Insurance Competitive Position Score can also be applied to a batch of policyholder records allowing insurance carriers to 

• Measure current and proposed rate position in selected markets

• Identify cross-sell opportunities

• Increase retention by better understanding which customers are vulnerable to churn

• Craft high-performing direct mail campaigns.

The Results Say It All!

An extensive analysis has shown that the Insurance Competitive Position Score is a powerful needle mover that allowed a direct carrier to 

1. increase lead close rates by 47%; and

2. lower the cost-per-sale by 44% when compared to non-scored leads.1  

In a second analysis, a captive agency closed leads with a Competitive Position Score of 3 or 4 at a 54% higher rate1 than those with a score of 1 or 2. With bid optimization, the agency boosted conversions by 34%1 on average, which allowed them to more efficiently bid on and purchase leads. 

The current economic market is making insurance prices more important to applicants than ever before. To grab their attention and win more sales, consider a differentiated marketing strategy supported by Competitive Position Score. It’s a proven solution for optimizing insurance acquisition costs and enhancing the customer experience, in one simple step. 

Learn more about the Insurance Competitive Position Score solution and take advantage of premium insights relative to a custom group of your competitors.
 

¹ First Interpreter 2022 analysis. Results published with the customer’s permission.