GovTech vs InsurTech Churn Rate
Side-by-side benchmark comparison, updated March 2026.
GovTech has a lower monthly churn rate (0.8%) than InsurTech (1.5%), a difference of 0.7 percentage points. GovTech median ARPU is $500 versus $290 for InsurTech.
Head-to-head benchmarks
| Metric | GovTech | InsurTech |
|---|---|---|
| Monthly churn | 0.8% | 1.5% |
| Annual churn | 9.2% | 16.9% |
| Median ARPU | $500 | $290 |
| Typical customer base | 50-500 | 50-1,500 |
Top govtech churn drivers
- Budget appropriation cycle not renewed for the software line item32%
- Procurement rules required retendering after contract term27%
- Elected official change shifted departmental priorities20%
- Product failed FedRAMP, StateRAMP, or CJIS compliance audit13%
Top insurtech churn drivers
- Carrier or MGU replaced third-party tool with proprietary system30%
- Regulatory compliance gap identified during state filing25%
- Product lacked actuarial or underwriting model depth required22%
- Poor integration with policy administration system15%
Why govtech retains better than insurtech
The 0.7-point gap between GovTech and InsurTech reflects differences in switching cost, value density, and purchase motivation. GovTech customers face higher integration and data-migration friction, which extends tenure. InsurTech tends to have more fragmented alternatives and weaker lock-in. Details in each benchmark page above.
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