This is a Recording

Automated messages phoned to policyholders with overdue bills have improved retention of customers for a personal auto carrier.

What parent hasnt told a teenage victim of unrequited love there always are more fish in the sea? Insurance carriers often have taken the same concept to heart in relationships with policyholdersif a customer stopped paying premiums, the insurer simply would sell a policy to someone else.

Carriers eventually learned there are more profits in retaining customers than in trying to attract new ones. That is one reason auto insurer Unitrin Direct turned to EnvoyWorldWide and its EnvoyConnect system to provide payment reminders to policyholders, particularly when policies have reached a past-due status or are nearing renewal.

As a direct-to-consumer auto insurer, persistency and retention are very important to us, says Brian Crumbaker, senior vice president of claims and operations for Unitrin Direct. We noticed we were getting a fair amount of nonpay cancellationsthe people who just forget to pay their billsand saw a case study where another insurer was getting some pretty fair results on retention.

Crumbaker was familiar with the insurer using the EnvoyConnect product. He felt so good about the product that Unitrin Direct bypassed the normal selection process and licensed the system last September. This is one of the few things for which we did not go out and get competitive bids because the cost to implement was so insignificant, says Crumbaker. We felt this was going to be a solid investment for us, and we wanted to do something very quickly. This is one of the few instances where we took a bit of a leap in faith.

EnvoyWorldWide was knowledgeable in the type of campaign that Unitrin Direct wished to run, according to Wilma Richardson-Tidwell, director of special projects for Unitrin Direct. The payment reminder was similar to what EnvoyWorldWide had done with other insurers, she says.

Unitrin Direct developed a script that was recorded to be delivered to policyholders who had failed to pay their premiums within a certain time frame after the due date, explains Richardson-Tidwell. The messages give the customers options. If a person answers, we give an option to transfer straight into our interactive voice response (IVR) system, where he or she can make a payment immediately, she says.

Another benefit of the product is when the call is placed, the recipient has options before the script is read, including putting the call on hold so that the appropriate recipient can get on the line, or if that person is busy, a call-back can be requested, adds Richardson-Tidwell.

The product has a Web interface that allows the carrier to import the data on the customers who need to be called. Once [EnvoyWorldWide] sets up the template, we are in complete control of the campaign, says Richardson-Tidwell. Thats the route we wanted. The system also allows Unitrin Direct to set up calling windows.

Unitrin Direct asserts retention is an important point in gauging the success of the system. The measure we use is whether the policy stays with us through the entire policy period, says Crumbaker. We sell 12-month policies, so we were looking at how many policies actually make it to the 12th month. Retention is how many of those policies actually decide to renew with us for month 13.

Crumbaker is pleased with the payback thus far. There are tons of things you can do with [the system], he says. Were making call-outs for state-required forms. Were removing the need for clerical [staff] to type a letter or make a call themselves. Thats all been automated now.

Crumbaker also plans to use the system to contact policyholders in Florida if the insured property is in the path of a hurricane. Another possible use is to make automated outbound sales calls. If that works, it will be quite a productivity enhancement for us, he says.

Crumbaker is thrilled with how the system has worked. My only hesitation in giving interviews is I truly feel this is a competitive advantage, he says. Its given us a nice little boost. ROBERT REGIS HYLE

Case File
THE PROBLEM
Carrier needed to deliver automated,
personalized messages to policyholders.

THE CARRIER
Unitrin Direct
Web Site: www.unitrindirect.com
Earned Premium: $180 million

THE SOLUTION
EnvoyConnect from
EnvoyWorldWide, Inc.
Web Site: www.envoyworldwide.com

Special Reports /

CUSTOMER RELATIONSHIP MANAGEMENT

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