SelectQuote Inc.’s 2nd Quarter 2021 LTV and Approved Policy results
Telos Actuarial recently compiled key information on SelectQuote Inc.’s (NASDAQ: SLQT) 2nd Quarter Financial results.
(NOTE: SelectQuote’s fiscal year is from July 1 – June 30 each year. However, this article reports their information using a normal calendar year cycle.)
One of the key metrics reported by SelectQuote on a quarterly basis is constrained Lifetime Value (“LTV”) per approved policy. LTV is the estimated amount of commissions the company expects to receive over the life of the policy, per approved policy.
*Estimated based on year-end results (SelectQuote’s year-end results are reported as of the end of Q2)
SelectQuote’s LTV decreased for all product lines (aside from “Other”), with Medicare Advantage (“MA”) and Prescription Drug Plans (“PDP”) seeing the largest drops.
SelectQuote’s commentary on LTV (which is referencing full year LTV) mentions some of the reasons for the changes in LTV. They mention that Medicare Advantage “was negatively impacted by lower MA persistency rates, higher intra-year lapse rates and carrier mix somewhat offset by higher commission rates”, while Medicare Supplement “was negatively impacted by a carrier mix shift of policies to a direct carrier pod that pays us lower commissions but has lower marketing costs”.
Another key metric reported by SelectQuote is approved policy counts. Overall approved policy counts increased 43% when compared to the same quarter last year.
Growth in approved policy counts continues to be driven by Medicare Advantage, with Dental/Vision/Hearing (“DVH”) also seeing healthy growth.
Source data: SelectQuote Inc.’s quarterly Form 10-Ks and 10-Qs (https://ir.selectquote.com/financials/quarterly-results/default.aspx)
Telos Actuarial helps distributors maximize the lifetime value (“LTV”) of their commissions by providing persistency analysis, industry lapse and persistency reports, projected commission cash flow analysis, and LTV calculations. Send us an email for more information. info@telosactuarial.com
