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Decrease cycle time, increase placement ratio, and you can increase revenue

Why does CIC spend so much time thinking about things, like cycle time and placement ratio?  

Because cycle time and placement ratio influence:

  • how quickly a client can be insured
  • the minimization of delays or declines
  • overall client satisfaction
  • faster commission payments

Fast Facts:

  • Industry average cycle time – 75 days
  • Industry placement ratio – 75%
  • A 25% increase in placement ratio will increase your revenue by 50%

Lost Revenue:

Long cycle times and low placement ratios lead to lost revenue.  For example, a 25% increase in placement ratio can lead to a 50% increase in revenue.  Let’s say you submit $300,000 per year in life insurance, but your placement ratio is 50%, your revenue is $135,000.  If your placement ratio was 75%, you would increase your revenue by 50% or an additional $67,500 in annual revenue. (Assuming 90% average commission.)

This is just one more way we set ourselves apart from other brokerage agencies.  Our cycle times are well below industry average, and we have the tools and resources to increase your cycle time.

6 Ways to improve placement ratio, starting today

  1. Starting with a client needs analysis before, comparing quotes.  The cheapest quote may not always be the best fit.  Or the client’s health may not allow for Preferred Best, however, if you understand the needs, before you look for the best quote, you won’t have to disappoint the client and re-explain the reason for not a decline of the cheapest product.
  2. A little field underwriting goes a very long way.  Even if you do not have all of your client’s health details, reviewing age, height, weight and some basic factors can start to narrow your search greatly
  3. Start with an informal.  You can use our informal process and intake form to gather client information and then our underwriters will review and narrow the scope of products that are most appropriate for your client’s needs.  Our underwriters have the expertise and knowledge to work with insurance products and companies to find the best fit.  This minimizes the time it takes for a formal app placement and increases the likelihood of placement.
  4. We offer products with accelerated underwriting.  Some products will provide an approval in less than 10 minutes.  If your clients qualify, approval is almost instantaneous.
  5. Utilize our case status tools and case managers.  You can access your cases on our website 24/7.  Our case managers also provide email notification every Tuesday regarding all of your outstanding cases, and they will email notify you whenever there is a change in status or outstanding requirements needed.
  6. Use docusign, eApps and eDelivery.  This will improve your cycle time (which improved placement) by up to 80%.  We see eApp cases go from submit to placed within 24 hours.  Now, not every case will move this quickly, but they do move more quickly.

Final notes…Even when you execute on all of the techniques we recommend, not every case will place.  There may be unforeseen health or other issues.  That’s why we strive for 75% placement, rather than 100% when it comes to life insurance products.  It’s also why we suggest starting with a needs analysis, rather than starting with price.

If you haven’t considered annuities in your practice, you may want to think about how they will supplement your revenue.  Annuities have an almost 100% placement ratio and can diversify your product and revenue mix.