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Life insurance industry innovations worth a look

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The May issue of National Underwriter Life & Health will mark the inaugural “Insurance industry product innovation” feature. Within it, we profiled innovations in the life, health and annuity markets. Below are the life industry innovations we selected.

The American College’s RICP Program

With more than 10,000 baby boomers turning age 65 on a daily basis since 2011, retirement income planning has taken on added urgency among life insurance and financial services professionals. The growing pool of boomers exiting the workforce has prompted many advisors to complement their traditional focus on asset accumulation with expertise in asset decumulation—the drawdown of retirement accounts.

Enter The American College’s Retirement Income Certified Professional (RICP) designation. Launched in April of 2012, the continuation education program boasts a rigorous three-course curriculum to helps advisors master retirement income planning.

Why a designation tailored to this specialty? Don’t other programs offered by The American College, including the Certified Financial Planner (CFP) and Chartered Financial Consultant (ChFC) programs, also cover income planning? Indeed they do, but not in the depth provided by the new curriculum.

“Unlike other coursework offered through the American College, The RICP program is laser-focused on retirement income,” says Jamie Hopkins, an assistant professor of taxation at the school. “It’s all about best practices and techniques for drawing down assets, be they annuities, life insurance, IRAs or Social Security.”

Students enrolled in the RICP coursework gain proficiency in a range of areas unique to the specialty. Among them: retirement portfolio management techniques; mitigation of plan risks to the proper use of annuities; employer-sponsored benefits; and determining the best Social Security claiming age.

The program’s three courses include (1) “Retirement Income Process, Strategies and Solutions;” (2) “Sources of Retirement Income;” and (3) “Managing the Retirement Income Plan.”  Most advisors will require about a year to complete the program, according to the college.

In selecting the RICP program for inclusion in our May feature on innovations, the NU editorial staff considered not only the depth and breadth of the coursework, but also the high-tech method of delivery. The instruction is provided through online video lectures and interviews —a departure from the traditional college textbook — plus supplemental material and a comprehensive study guide.

And because of the digital component, coursework can be easily and quickly updated to integrate new developments that might dovetail with the instruction. Example: a video focusing on President Obama’s proposal, debuted at his State of the Union Address earlier this year, to offer a retirement savings program for workers whose employers don’t offer a 401(k) plan.

For continuing ed students desiring coursework that better reflects what’s happening in the real world, such curriculum developed on-the-fly is about as good as it gets. The MetLife Wall

To help a gain competitive edge, MetLife is investing more than $300 million in information technology initiatives that, the company promises, will “transform the customer experience” and fulfill unmet needs. Among solutions resulting from the IT effort is the “MetLife Wall,” a Facebook-like software app that aims to ease and speed interactions between service agents and customers.  

To that end, the software platform provides a complete timeline of customer’s transactions — claims, records, status, etc. — enabling MetLife agents to quickly retrieve and cross-sell solutions (e.g., marketing auto or homeowner’s insurance to life insurance policyholders). To strengthen the data capability, the company is also looking at integrating other sources of customer info, including social media and mobile apps.

Built on a MongoDB open-source (NoSQL) document database, the MetLife Wall gathers data from more than 70 legacy systems. The software connects to six application servers in two data centers and twelve database servers carrying a storage capacity of 24 terabytes.

The database houses digital records of all U.S. MetLife customers — an amount totaling more than 50 million JavaScript Object Notation (JSON) documents. The company’s objective now is to extend the software’s functionality to international customers and other languages.

The MetLife Wall integrates into one data record, and makes viewable on a single screen, “all related and linked customer information.” Result: a “360-degree view” of policyholders, the software displaying interactions with different customer-facing reps, including call center and field agents.

MetLife has paired the Wall with an enterprise-wide implementation of, a cloud-computing based customer relationship management solution. The objective is to consolidate all data onto two screens: serving as the platform for sales and service transactions; and the MetLife Wall retrieving customer records from the company’s application servers.

What else in the works? MetLife now is looking to create “next-best action models” that will guide agents on how best to work with clients and prospects.  The company’s IT team has additionally used the software platform’s MongoDB chassis to build models for predicting attrition. The insurer is also looking to convert the Wall into a “bi-directional application capable of updating legacy systems of record.”

It sounds very cutting edge. So stay tuned! Munich Re’s Breast Cancer Tumor Calculator

Faster underwriting. More favorable policy ratings. Lower premiums. Increased sales.

These are among the promised benefits of a breast cancer tumor calculator that Munich Re rolled out last October to its primary clients: life insurance carriers whose policyholders Munich Re covers through reinsurance treaties with the companies. As part of the agreements, Munich Re avails the carriers’ underwriters of its EDGE Life and Disability Income underwriting manuals, which have been revised to better reflect the progress that medical science has made in diagnosing and treating breast cancer.

The latest iteration of the manuals include a breast-cancer tumor calculator—one of three now available in the product (the others include prostate and cutaneous melanoma cancer calculators). Accessed via proprietary software developed by Munich Re, the calculator guides underwriters through a series of drop down boxes and questions to help arrive at an appropriate underwriting rating based on the nature and severity of a policy applicant’s breast cancer tumor.

Among the queries: the type of cancer, age of diagnosis, duration of cancer since diagnosis, and gender (most — though not all — of breast cancer patients are women). The software calculator will also inquire about the size of a “T1” or “T2” tumor (Munich Re only underwrites these early stage cancers), whether the cancer has metastasized and what evidence points to the spread of the cancer (e.g., a chest x-ray).

If the application isn’t declined, the software will produce a rating and an appropriate premium can then be attached to the proposed policy. “The software’s fields can be quickly completed,” says Robert Lund, a vice president and medical director, at Munich Re. “It’s a pretty slick app.”

Though lean, the breast cancer tumor calculator draws on extensive research demonstrating that more breast cancer survivors are insurable, thus enabling carriers to offer policies at standard rates or use table ratings when standard is not possible. Thanks to the earlier diagnoses and improved therapies that medical technologies have enable in recent years, the “expression of increased mortality associated with cancer tends to come later” than was true in prior years, according to Lund.

Upshot: There is now little advantage to postponing underwriting to track the progress of an early stage breast cancer because the life expectancy of a T1 or T2 patient is roughly on par with that of women who are free of the disease.

“The results of our research show that we can make favorable policy offers much earlier than previously was the case,” says Lund. “The breast cancer tumor calculator has been very well received by the underwriting community.”

See also:

Annuity industry innovations

Innovation in insurance

Financial professionals: Innovation is critical to industry

Towers of innovation




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