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Cost per bound policy: the number that tells you if a lead source works

Updated October 4, 2026

Price per lead tells you what you spent. Cost per bound policy tells you what you got for it. It puts cheap shared leads, pricier exclusive leads, and your own ads on the same scale.

How to calculate cost per bound policy

You need four numbers for one lead source, measured over the same weeks:

• Price per lead: what you paid per lead, after credits for returns.
• Contact rate: the share of leads you actually spoke with.
• Quote rate: the share of those conversations that got a quote.
• Bind rate: the share of those quotes that bound.

Cost per bound policy = price per lead ÷ (contact rate × quote rate × bind rate)

Multiply the three rates and you get the share of leads that turn into a policy. Divide the price per lead by that share. If you only want the total, divide everything you spent on the source by the policies it produced. The rates are still worth tracking, because they show where leads drop out.

Cost per bound policy calculator

Enter numbers from your own CRM. The math runs in your browser, and nothing is sent anywhere.

Count the same way for every source

The rates only compare if each one means the same thing for every source. Write the definitions down before a test starts, and share them with whoever works the leads:

• Contact: a real conversation with the shopper. A voicemail or a wrong number doesn't count.
• Quote: a price you gave the shopper, by phone, text, or email.
• Bind: a policy issued and paid. A promise to call back doesn't count.

If you subtract credits for returned leads from your spend, take those leads out of the lead count too. Mixing the two makes a source look better or worse than it is.

How many leads does it take to sell a policy?

Leads per bound policy = 1 ÷ (contact rate × quote rate × bind rate)

For easy math, say you reach half your leads, quote half of those, and bind one quote in four. That's 0.5 × 0.5 × 0.25 = 0.0625, or one policy for every 16 leads. Those are made-up round numbers, not benchmarks. Your rates depend on the source, the line, the state, and how fast your team calls.

Each rate points at a different problem:

• Low contact rate: the shopper isn't answering. Check how many other agents got the lead and how fast you called.
• Low quote rate: you're reaching people who can't or won't get a quote. Check your filters and where the leads come from.
• Low bind rate: the quote isn't landing. Look at price, carrier appetite, and follow-up.

Why a cheap lead can cost more per policy

Take two sources, with made-up numbers again. Call Source B's price per lead one unit. Source A costs half as much, so half a unit. You bind one in every 40 of A's leads and one in every 15 of B's.

• Source A: 40 leads × half a unit = 20 units per bound policy.
• Source B: 15 leads × 1 unit = 15 units per bound policy.

The lead that costs twice as much is the cheaper way to write a policy. Shared leads can lose this way: the price is low, but so is the contact rate when several agents call the same shopper. Our guide to exclusive vs. shared leads goes further.

Is buying insurance leads worth it?

It is when your cost per bound policy sits well below what a new policy is worth to your agency. Only you know that number. It depends on your commission, renewals, how long customers stay, and how often one policy turns into two.

When leads lose money, the rates tell you where. A weak contact rate is a lead or speed problem. A weak quote rate is a fit problem. A weak bind rate is a pricing or follow-up problem. Fix the weakest one first, or move the money to a source that does better.

How to track it without fooling yourself

• Tag every lead with its source in your CRM from the first day.
• Count a bind from a lead even when it happens weeks later, at renewal.
• Subtract credits for returned leads from what you spent.
• Compare sources over the same weeks, states, and lines.
• Decide how you count a bundle, as one policy or two, and count it the same way for every source.
• Give each source enough leads before you judge it. On a small test, one good week can look like a great source.

Then raise spend where leads bind and cut it where they don't. That's why VeroQuote starts with a test batch: you get your own numbers before you commit to volume.

This guide is general information, not legal advice.