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Question 365 - CBAP discussion

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An insurance company wants to increase sales by 15% and customer retention by 10% within 1 calendar year. Various strategies to achieve this were considered and a restructure to the existing pricing model is selected to help achieve these goals.

A business analyst (BA) works with stakeholders such as actuaries, product specialists, sales staff, risk managers, and underwriters who agree to applying varying levels of discounts to customers based on:

- Total annual premium the customer has with the company (Financial worth) - Time with the insurance company (Loyalty) Various financial models are considered but the stakeholders agree that an initial applicable discount is determined based on the customer's overall premium:

The percentage of the maximum possible discount available to the customer is adjusted based on time with the company:

If within the first six months, customer retention increased by 5 % and sales increased by 6%, then when will the desired sales and retention goals be achieved assuming the trend continues at the same pace?

A.
Sales - 2 years; Retention - 18 months
Answers
A.
Sales - 2 years; Retention - 18 months
B.
Sales - 3 years; Retention - 1 year
Answers
B.
Sales - 3 years; Retention - 1 year
C.
Sales - 2.5 years; Retention - 2 years
Answers
C.
Sales - 2.5 years; Retention - 2 years
D.
Sales - 18 months; Retention - 1 year
Answers
D.
Sales - 18 months; Retention - 1 year
Suggested answer: B
asked 18/09/2024
Md Ali Uz Zaman
34 questions
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