Q. With insurance companies tightening up underwriting, I’m concerned that my declines will increase. What suggestions can you provide to help turn a decline into an in-force policy?
A. As we all have learned the hard way, a declined client is a very unhappy client. So it helps to have a procedure in place if this occurs.
For advice in this area, I consulted with Leni Cohen, who manages the Decline Review Program for ACSIA.
Here are her suggestions:
Step one: When initially meeting with the client, keep your options open when discussing the need – particularly if you realize that there could be an underwriting problem.
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A good statement to use is: “Every carrier has different criteria. Based on the information you have provided. I recommend this carrier as our first choice. However, if we run into an underwriting problem and you are not approved, I have another carrier in mind. So we have a backup plan.”
Step two: Provide additional information that indicates a positive focus by preparing an agent letter to submit with the application.
Include an explanation of borderline conditions. The client will feel that you are already working for him. If the outcome is a decline, it may soften the blow. And underwriters like the additional information.
Make sure that the client knows that whether he goes forward or not with the policy, it is important to remove a decline from his permanent records for future insurance products.
Since the client knows that you have other options if one person is refused, that helps prevent the situation where the other spouse refuses to take a policy if the partner is declined.