SelectQuote Inc.’s 4th Quarter 2021 LTV and Approved Policy results
Telos Actuarial recently compiled key information on SelectQuote Inc.’s (NASDAQ: SLQT) 4th 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.)
LTV Metrics
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.
SelectQuote’s LTV decreased for Medicare Advantage (“MA”), Prescription Drug Plans (“PDP”), and Dental Vision Hearing (“DVH”) while LTV increased for Medicare Supplement (“MS”).
Cohort/Tail adjustment
In addition to dropping LTV for new sales, SelectQuote also “recognized an $145 million downward cohort/tail adjustment based primarily on higher intra-year lapse rates and overall persistency from January 2022 renewals.” This makes up roughly 15% of the prior quarter commission receivable balance.
Approved Policy Counts
Another key metric reported by SelectQuote is approved policy counts. Overall approved policy counts increased 22% 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 growth.
*Estimated based on year-end results (SelectQuote’s year-end results are reported as of the end of Q2)
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
