Vijay Kotte: Thanks for the question, Ben. As it relates to our contract and progress on the Encompass model, as we indicated late last year, we had all of our major carriers rolling through the Encompass model in Q4 AEP. What we’ve found in comparing those results, those who really adopted that full model, the quality experience we’ve been describing here, previous calls, we talked about Tier 1, the qualification, Tier 2 being the shopping experience, and Tier 3 really being that a verification of the sale and then the onboarding process beginning, the quality results of that were very high compared to the traditional. We saw an uptick in the effectuation, which is, those policies written that actually became effective as of January 1.
So we saw all that lift. And so there’s definitely been a lot of support from our carriers to expand the program to include other products to exclude — and help us test with our external channels as well. So we’re very optimistic about how that’s going. Every year, some of our contracts are year-to-year. Others have longer tenures on them. They are multiyear. So there’s always a continuous process as we think about this. But as we continue to have those conversations, there’s , there’s a support for the model and continued interest in expanding it as we move forward.
Operator: The next question is coming from Sam Hirsch of William Blair.
Adam Klauber: This is Adam Klauber from William Blair. Can you hear me?
Vijay Kotte: Yes.
Adam Klauber: Yes. I’ll jump in for Sam. On the look-back, you mentioned that — you obviously have more data than they’ve had in the past. So — but I think two questions on it. One, do you think your assumptions were relatively more conservative than they were using the past, number one? And then number two, in the future, as you’re shifting the model significantly both in structure, but also on a cash basis, do you think the look back to either positive or negative, just by nature, will be smaller than they’ve been in the past?
Vijay Kotte: Thanks for the question, Adam. Let me first talk about the model and your question you asked if it was more conservative. I’d say that we have more data. And as you get more data and more experience that we were able to analyze in the fourth quarter, we were able to update the model. So I think it’s less about conservatism. We’re always trying our best to be that. It’s really about revising our estimates based on actual experience that we can have more stratify at the different carrier levels, the product levels, and then being able to extrapolate that behavior into the trending that we have in our triangles. And so as we looked at that, we felt as though we were doing that with the best information we have as accurately as we could.
And then on top of that, knowing that there’s a — as we look at the prediction going forward, adding a constraint on that so that we could, one try to estimate the trends that we might see into the future and anticipate some of the things that we spoke earlier with Jonathan about it, is a natural fluidity that’s starting to be seen in the marketplace where people are just shopping more and therefore switching more often than they historically had. So I think it’s more that the dynamics of the market are changing, and we’re reflecting that as we are serving it into our estimates. Now as you think to the future, yes, naturally, what you’re saying is true is that as we have more shift towards Encompass, we’ll have less of new volume moving into that back book.
