How to track insurance policy persistency

Persistency ratio is the single most important metric for insurance agents in India — it directly affects your commission, your insurer relationship, and your long-term income. This guide explains what persistency means, how to calculate it, and how to improve it.

What is persistency?

Persistency is the percentage of policies that renew in a given year. If you had 100 policies in force on Jan 1 and 85 of them renew by Dec 31, your Year 1 persistency is 85%.

IRDAI mandates minimum persistency targets: 60% for Year 1, 70% for Year 3, 75% for Year 5. Agents who consistently fall below these risk losing their agency.

How to calculate persistency

Persistency = (Policies renewed in the period / Total policies due for renewal) × 100. Track this separately for Year 1, Year 3, and Year 5. Most insurers provide this number in their agent portal, but you should track it independently.

Why persistency matters

• Renewal commissions: 2-7% of every renewal premium goes to you as long as the policy is active
• Persistency bonus: Insurers reward agents with 90%+ persistency with bonus payouts
• Agency security: Below-target persistency can trigger warnings, territory loss, or termination
• Client trust: High persistency signals quality service and generates referrals

How to improve your persistency ratio

The agents with the highest persistency follow a simple routine: track every policy due date, send renewal reminders 30 days before expiry, follow up with a phone call 7 days before, and WhatsApp the client on the due date. Use renewal tracking software to automate the reminders.