Definitions for persistency and activation rate

ethos.com

Definitions for persistency & activation rate

1 - Persistency Rate:

For example, we’ll use a 4-month persistency rate of 90% or better.

C = # of Activated - free look - initial payment failure - rescissions, activated between 4 and 16 months ago (rolling 12-month window) that have persisted at least 4 months, i.e. 4 months <= (today - effective date) <= 16 months AND (paid-to-date - effective date) >= 4 months

D = # of Policies activated between 4 and 16 months ago (rolling 12-month window), i.e. 4 months <= (today - effective date) <= 16 months

Persistency Rate = C/D

2 - Activation Rate:

The number of approvals you received that pay their initial premium during the program period. This needs to be a minimum of 65%.

A = # of Activated - free look - initial payment failure - rescissions (exclude all re-routed products, Accidental Death, and riders) activated within the last 12 months

B = # of Approved (exclude all re-routed products, Accidental Death, and riders) within the last 12 months

Persistency Rate = C/D

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