Five Indicators to Consider a Due Diligence Review on Affinity Programs

Would you drive your car around and never take it in for a tune-up? Most certainly not. Your insurance affinity programs should be treated the same. Why? Insurers and brokers that provide these programs can experience significant variations in their performance, year over year. In other words, they have good years and bad years and this may impact your program and members. However, a good profitable insurance affinity program managed by a capable insurance provider should provide more stability in pricing and coverage to the members of an association, compared to the general market. If not, why bother?

If you are uncertain if it’s time to review your program(s), consider these five indicators:

Your provider is not meeting with your association and reporting on the program on a regular basis

Best-in-class providers should report at least twice a year and meet with your association frequently to review the marketing of the program and other developments

Your provider is not supplying adequate information

At a minimum, your association should be receiving information regarding the number of members (clients) participating in the program, the renewal rate, quote-to-sale ratio, premium volume and growth over five years, profitability and losses.

The program is not growing

This may be caused by several different factors, including but not limiting:

• The rates are not competitive
• The service is poor
• The marketing is stale
• The association is getting complaints from members about the service (sales or claims), the prices and coverage gaps:

If you receive complaints, this is probably only the tip of the iceberg and you should ask questions as soon as possible. Being associated with a sub-par provider or a poor-performing program will hurt your brand and be counterproductive for your association.

You haven’t done a due diligence review of your program(s) in over five years

The insurance market for insurance affinity programs is constantly evolving and very competitive so your association should make sure that they are getting the newest and latest offerings in terms of financial incentive and benefits for the members. Benchmarking programs should be done on a regular basis for that reason only

Your CSAE Insurance experts can answer any questions you may have about your program(s) and complete a complimentary review, if necessary. Give us a call at 1-888-965-0023 or email us at: info@csaeinsurance.com.