For any insurance agency, defining its goals and measuring progress against those goals is vital to success. Goals give direction, simplify planning, and help you evaluate your company’s performance. They also motivate you and your team to achieve them. This article discusses some of the most common goals of an insurance company. These include profit, customer retention, and investment portfolios. Here are some of the most important goals of the best insurance companies in kenya..
Goals of the best insurance companies in kenya
Profit
Insurers are under pressure to reduce costs in the current economic climate, which can be complicated by the effects of digitization, low interest rates, and increasing price transparency. At the same time, new entrants are closing the gap with incumbents, and some studies suggest that digital attackers are at least 40 percent more profitable than incumbents. But how can insurers maximize their profits and move up the power curve? Here are three ways insurers can do so:
First, insurance companies conduct strategic planning processes each year. While such exercises often aim to take the company in a bold direction, the reality is much more a case of strategic inertia than bold vision. For example, best insurance companies in kenya allocate nearly the same amount of capital to their business units each year, despite the fact that they may face different economic conditions. This results in underwriting and investment income as the main sources of revenues.
Customer retention
Insurers strive to keep their customers. By identifying and responding to customer needs, they can provide personalized service and strengthen bonds with their customers. If a customer is satisfied, they are more likely to buy again. Personalization helps insurers retain customers by fostering strong personal relationships. Using PostGrid as a customer retention tool can help insurance companies communicate with clients and stay in touch. Not only can PostGrid improve customer relations, but it can also help them keep track of other policies and communicate with existing ones.
Another important strategy is to designate a specific employee to handle customer retention. This will motivate employees to keep customers, as well as make them more productive. Another effective method is to pay staff for customer retention. For instance, by paying staff by the number of customers they retain, they are more likely to keep them around. It also helps if the employee has a commissioned job rather than a general job.
Underwriting profit
As the world becomes more complex, improving underwriting efficiency is the common goal of insurance companies. Improved underwriting efficiency translates into higher economic profit. Insurers can improve their underwriting efficiency by adopting privileged customer segments, leveraging risk data, and enhancing analytics. The productivity gains are usually reinvested in higher product margins. Companies in stage 1 of the exponential journey are still behind the curve.
Underwriting profit is the amount of money the best insurance companies in kenya makes after losses are paid and administrative expenses are deducted. It does not include investment income from held premiums. It is a common goal of insurance companies, but many choose to disregard this goal in favor of more profitable market share. Ultimately, profits should be consistent and stable. However, the dynamics of underwriting profit are still a mystery. However, many insurance companies chase broad trends and aim to maximize profits while minimizing losses.
Investment portfolios
Publicly traded U.S. life insurers have more than $2 trillion invested in bonds and other securities, with the largest share in fixed-maturity instruments. While different insurers take a different stance on structured bonds, most allocate less than one percent of their invested assets to them. Nevertheless, structured securities will remain a part of the industry for the foreseeable future. Here’s a closer look at the composition and quality of investment portfolios.
Insurance companies invest in various areas, including stocks, mortgages, and short-term liquid investments. Most often, they invest in bonds, as they are the safest type of investment. However, because insurance companies are in the business of risk assessment, the low-risk nature of bonds makes them an attractive choice for them. But, as with most investments, insurance companies also place some of their money in other types of investments, including stocks, mortgages, and other liquid short-term investment vehicles.
