The time it takes to underwrite a policy is an inherent “problem” that slows down policy issuance, industry experts note.
And while the underwriting process certainly cant be taken out of the equation, carriers are streamlining the entire process, they add.
One technique used by some carriers is the pre-application, where an agent will only take a limited amount of information from a prospect, and then the home office will follow up with a detailed medical inquiry.
This methodology combined with internet technology is helping Zurich Life trim the amount of time it takes to get a policy issued, according to Michael Sladek, senior marketing director of field technology services for Zurich Life, Schaumburg, Ill.
Before introducing its electronic pre-application called Z-app, it took as long as two days for a pre-application to be submitted to the home office compared with the current five-minute turnaround, Sladek says.
The online pre-application was rolled out to Zurichs field in January of this year. Sladeks goal of 10,000 Z-apps this year is about to be met, with 9,775 having been processed through the middle of October. “We think were going to exceed our goal by 20%,” he says.
Agents in the field are able to enter a clients information in an online form; this is an abbreviated application that doesnt include any medical questions. Upon submitting the Z-app, the client will receive a follow-up call from someone in Zurichs home office to complete part two of the application, Sladek explains.
“In the pre-application process, the quicker we get it in the door, the quicker we can make the phone call to fill out the part two,” he says.
Once submitted, it takes about five minutes for the Z-app to get into the workflow system, and the follow-up phone call may come as soon as two hours later. “The key is to get the agent through the client sale as quickly as possible so that he can get on to the next sale,” he says.
Upon completion of the full application, an appointment is made for a paramedic to visit, who then goes over all the information in the application and gets the client signature.
When the information comes back to Zurich, instead of sending it right to an underwriter, it goes to what Sladek calls an “app-readiness team.” This is a new team that makes sure all the forms are in order for the underwriter, but also has limited authority to approve a case. “If all the fluids come back clean and its under $250,000 of insurance, they have clean case authority to approve it and issue it without even going through underwriting,” he says.
The Z-app process is currently only available for Zurichs term life portfolio, according to Sladek.
The Hartford has implemented a similar processing system, using a pre-application at the agent level, and then following up from the home office, according to Michael Keeler, senior vice president of individual life operations for The Hartford, from their offices in Minneapolis, Minn.
“Weve taken all the insurance difficulties off their hands [agents and brokers] and brought them into the home office; they dont have to fill out an app, and they dont have to ask their clients medical questions. Weve made it almost like an annuity ticket for them,” he says.