Policy Sales Growth Rate (PSGR)is a key performance indicator used by insurers to measure the success of their sales efforts. It is calculated by dividing the number of new policies sold in a given period by the total number of existing policies as of that same period.
For carriers and insurance agents, understanding the importance of PSGR is essential as it can help them create strategies for improving their sales performance. For example, if an organization is experiencing a low PSGR, it may need to focus on targeting new customers, increasing outreach and marketing activities, or offering better incentives to agents.
By tracking this metric over time and making adjustments as needed, organizations can optimize their sales performance and achieve the desired growth in policy sales. Additionally, monitoring customer retention rates alongside PSGR can help organizations identify potential issues in their sales process and evaluate the effectiveness of their marketing strategies.
Additionally, insurers can benefit from benchmarking their PSGR against that of other carriers in the market. This allows them to see how they compare to competitors and gain insights into areas where they may need to focus more attention or make improvements. It’s also an effective way of understanding the effectiveness of their sales efforts in different markets.
Finally, insurers should consider implementing a rewards program to motivate agents and increase policy sales. Incentives such as bonus payments for specific targets met, discounts on premiums for customers who have achieved certain levels of cover, or other promotional offers can all help to boost sales performance.
By understanding the importance of PSGR and implementing strategies to improve it, carriers and insurance agents can ensure their business remains profitable in a highly competitive market.