Reinsurers Services Proliferate
Newer. Better. Faster. Reinsurers say they are focusing their efforts on making this mantra a reality for direct writers.
Technology and product support are two areas that reinsurers and at least one direct writer cite as tangible ways reinsurance companies are meeting these goals.
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Know-how now includes not only expertise in mortality experience but also an ability to harness technology, says Roberto Baron, vice president and senior actuary, with MetLife Inc., New York.
Technological know-how makes it easier for an insurer to sell more insurance, he adds, and direct writers can now get real-time answers with a turnaround of a couple of hours.
For instance, RGA, St. Louis, a reinsurer in which MetLife owns a 59.1% interest, is testing a predictive modeling application in conjunction with BioSignia Inc., Durham, N.C., called mortality assessment technology (MAT). RGA says MAT will fine-tune preferred risk underwriting.
The model creates a template for measuring the predictive onset of disease and predictive mortality due to chronic diseases, according to Wayne Adams, a senior vice president with RGA. The effort has been under way for about a year. Testing started over the summer.
The new model creates a predictive mortality ratio for individual contracts and uses that ratio to rank individuals according to when they are likely to die, he says.
MAT is just one of the technological efforts RGA says it is offering. It is also making available FAC App electronic submission software, a nonproprietary product that, through its e-business unit, allows direct writers to submit facultative underwriting applications electronically to all reinsurers, track their status and get responses back from reinsurers, Adams adds.
RGA also continues to implement a system that is being offered globally. The Automated Risk Underwriting Analysis system will make it possible for direct writers to process treaties online, he says. Because the system uses a series of “drill-down” underwriting questions, it can be used by direct writers to sell insurance through telemarketing.
The system has worked in countries like the United Kingdom, he explains, because bank sales are more common, smaller face amounts are sold and, consequently, there are fewer underwriting criteria.
In addition to technological offerings, Adams says it is possible that additional support will be offered on universal life and term products to meet demands created by the Valuation of Life Insurance Policies model regulation, also known as Guideline Triple-X.
However, he says support for UL products will be strictly for mortality risk and not for secondary guarantees because of the long-term nature of such a risk.
Other areas RGA is looking at, he says, are long term care and critical illness insurance. The LTC market is still developing, Adams says, and while there is international experience for critical illness products, factors such as the U.S. health care market and litigation add unique features to the market here.
Critical illness is an area to which Optimum Re, Dallas, has been devoting resources, according to Bob Thomas, chief marketing officer.
Both development of products such as a mortgage product with a critical illness component and support for a direct writer once those products are developed are important pieces of providing service, he adds. Support is offered by spending time with the field force, helping them to market the product, he says. So, it is really “training the trainer,” according to Thomas.