In a bid to making sure that customers keep profiting from their life insurance policies and stay on track to meet their long-term financial objectives, ICICI Prudential Life Insurance has implemented cutting-edge machine learning models.
The insurance behemoth claims that this computerised technology allows them to better predict future persistency behaviour across all cohorts. When combined with the company's other efforts, it has produced more premium collections, more productivity, and increased profitability.
The solution aids the company in predicting future persistency behaviour of new clients being onboarded, enabling it to initiate appropriate action. This includes interactions with senior sales managers to resolve queries whereby offering excellent customer service experience, said ICICI Prudential Life Insurance in a statement.
Persistency is a metric used to determine the proportion of customers who continue to pay renewal premiums. A key indicator of both the quality of the sale and the insurer's possible future growth in the life insurance market is the persistency ratio. By paying renewal premiums, customers can secure their financial future and that of their family. By the end of December 2022, the Company's 13th month persistency ratio had grown from 83% at the end of December 2021 to 85.9%. The 61st month persistency ratio also showed quite similar improvements, rising from 50.2% in December 2021 to 64.8% in December 2022.
Customer-centricity is the centre of all we do, said Mr. Dhiren Salian, Deputy Chief Financial Officer of ICICI Prudential Life Insurance. We have been using data science and technology as a "Customer First" company to make sure that our customers are on track to meet their long-term financial objectives. This is consistent with our goal of creating a reliable institution that sensitively meets the protection and long-term saving needs of consumers.
We have noticed an improvement in our persistency ratios across all cohorts since implementing advanced machine learning propensity models. More premium collections, improved productivity, and long-term sustainable growth are the outcomes. By taking into account their preferences, characteristics, and expectations, we are able to provide a more engaging experience thanks to these models, continued Dhiren Salian.
Moreover, persistency improvement connects to one of the 4P strategy's main levers. We have made considerable progress in this area thanks to the application of data science and technology. The Company's profitable expansion has been fueled in part by persistent improvement. From 83% in December 2021 to 85.9% in December 2022, our 13th persistency increased. Similar to this, Dhiren Salian noted that our 61st month persistency increased from 50.2% in December 2021 to 64.8% in December 2022.
Companies that advertise ICICI Prudential Life include ICICI Bank Limited and Prudential Corporation Holdings Ltd. Since the beginning of the company's fiscal year in 2001, according to Retail Weighted Received Premiums (RWRP), it has consistently been rated among India's top private sector life insurance companies. As of December 31, 2022, the company has a total sum insured of Rs. 27.55 trillion and an AUM of Rs. 2,518.84 billion.
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