The coronavirus pandemic and social distancing measures have changed how we do business across industries — and insurance underwriting is no exception.
Typically, life insurance underwriting requires a thorough medical examination (as anyone who has ever applied for a policy will know well). This involves an in-person visit, allowing the medical examiner to conduct a blood pressure reading, weight check, blood draw and more. But as we shelter in place and limit contact with others, clients don’t need to head into a lab or invite examiners into their homes.
At the same time, the need for financial protection and guidance hasn’t gone away — so as insurers, we need to adapt to this new normal to ensure we are still able to help clients protect their families and take control of what they are able to, even amidst uncertainty.
How Technology Is Easing the Process
The good news: Many tools already exist to help underwriters overcome these new challenges posed by social distancing. And people are looking for life insurance protection now, more than ever. In fact, at Equitable, we received 6,000 applications in March and April alone that we’re currently underwriting.
(Related: Life Application Activity Soars: MIB)
But without open labs, insurers need to adopt solutions to provide clients with the life insurance coverage they need, even when traditional underwriting processes can’t be met.
Enter claims data from medical insurance carriers. Insurers can look through this data to see if clients applying have recently have blood drawn, what kinds of pre-existing conditions they have, and more, and use that as a substitution for a real-time, up-close-and-personal exam and lab draw.
Another option: Partnering with a lab to send out saliva self-testing kits, similar to what applicants might be familiar with if they’ve taken genetic tests. This is quick, easy, painless and private — there’s no third party there in the room.
Underwriting isn’t the only thing getting a boost from technology — it’s also streamlining the entire process of acquiring a new life insurance policy, from the initial conversation to assess a client’s needs to the final, delivered policy.
Scheduling visits virtually can be a much smoother process, since clients and their spouses are typically spending more time at home and can much more easily align their schedules for an appointment with their financial professionals. By involving more family members in the process, Equitable Advisors Financial Professionals have been able to help clients truly assess their needs and create potential strategies for the whole family.
The Challenges Underwriting Technology Poses
Despite the benefits, new methods can’t be implemented without challenges. As insurers use data from claims and a multitude of other sources to get their clients the life insurance policies they need, quickly and without invasive measures, the issues of cybersecurity and privacy need to be addressed — especially given the sensitive nature of the data they’re dealing with.
To protect client data, it’s imperative that insurers thoroughly review any vendors they work with, as well as give clients access to their own information. We do our best to ensure clients understand that their privacy is always top-of-mind for us, and we are taking consistent and comprehensive measures to protect it.
What’s Next for Underwriting Technology
The pandemic continues to accelerate us further into the future of work. As we continue to underwrite life insurance policies – even from a safe distance – the future of underwriting is edging closer, too.
Even once the pandemic one day eases, we can expect to see a smoother underwriting process across the board. Numerous insurance carriers — Equitable Financial Life Insurance Company and Equitable Financial Life Insurance Company of America included – already have streamlined programs.
We’ll also likely see more relationships with vendors who have the right tools and offerings to make underwriting processes low-touch. Finally, technology continues to evolve at a breakneck pace. Even if carriers do continue to require physical data, technology will still be able to help. Getting information through a swab to the mouth now may be replaced by something as simple as sharing the data from health-related apps and trackers on your smartphone with your carrier.
One thing is for sure: The tools we’re talking about using now — in the middle of a crisis — are not going to go away. They’re just going to get better and better. Insurers are likely going to keep expanding more and more into this technological, no-touch environment, and one day — once social distancing measures have been lifted — will be able to provide clients with a comprehensive set of high- and low-touch underwriting options that fit their preferences.
Shelby Hollister-Share is head of life underwriting at Equitable. Equitable, a subsidiary of Equitable Holdings, provides advice, protection and retirement strategies for individuals, families and small businesses.