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perform a cost benefit analysis on the basis of response and conversion rates and cost per contact.

* The cost of reaching a thousand customers on the internet is about $5 as compared $200 for direct mailing. If the insurer considered only the cost per contact, online marketing is the clear winner however;

* Direct mailing has a response rate of 1% and the response rate for online marketing is even lower. As per some studies, one out of 200 customers click on an online banner advertisement and only one of the 100 end up buying the product.

* So if the insurer plans to target two million customers, online marketing would cost $10,000 and direct mailing $400,000.

* If the insurer considered only conversion rates, direct mailing would generate about 20,000 customers while online marketing would generate roughly 100 customers, which means the acquisition cost per customer is less in the case of direct mailing as compared to online marketing even though the cost per contact is lower for online marketing.

* On the other hand, if the insurer considered retention rates of each alternative with online marketing reaching 90% as compared to 60% from direct mailing, the CLV is close to $245 for online marketing and $69 for direct mailing. Therefore, in this case even with a high cost of acquisition, online marketing is a better alternative for the insurer.[41]

Organization Structure: The organization structure for a customer centric insurer should focus on the following:

* Customer-centric - Insurers need to change the organizational culture to become most customer centric and the product managers should also consider the customer while designing the insurance policy.

* Incentive Systems - The new incentive structure should reward employees on the basis of the following:

o Number of products sold to the customer by cross and up selling.

o Customer retention rate, which indicates the employee's ability and desire to provide quality service to the customer.

* Hiring and Training - Insurers should make it clear from the start of any employment contract that customer satisfaction is a critical factor in measuring an employee's personal and professional success. To reiterate the importance of satisfying customers, employees should be trained on a regular basis.

* Customer Based Costing - The accounting approach of the company needs to incorporate customer based accounting. In customer based accounting costs associated with customer retention and acquisition are allocated to each customer. An insurer should allocate costs based on the size of each customer account. The allocations of costs for large customer accounts are relatively higher because the customer demands a greater amount of resources from the insurer. Continuous Improvement

The Continuous improvement phase includes updating action plans and strategies to make it more efficient and effective to achieve the organizational objectives. The continuous improvement cycle is depicted in Figure 22.

The objectives of continuous improvement are achieved by:
· Continuous performance measurement: The performance indicators established in the planning phase should be reviewed on a periodic basis to avoid any deviations from the stated objectives and un-realistic forecasts and assumptions. In