Chess and a data process flowchart (Credit: Thinkstock)

Colm Kennedy is helping life insurers automate and speed up underwriting processes.

Kennedy is executive vice president Americas at Munich Re Automation Solutions. Companies like Lincoln Financial turn to him for ideas about how to review coverage applications better.

Consumer group reps have been questioning whether the new accelerated underwriting systems are fair. Hank George, a veteran underwriting, has wondered whether the systems provide enough of the data that underwriters need to detect problems created by the COVID-19 pandemic.

(Related: Analysis COVID-19 and Fast Underwriting Are a Bad Mix: Veteran Underwriter)

Here are three things Kennedy said about efforts to automate life insurance underwriting, drawn from a recent email interview.

1. Life insurers like the automated systems they’ve already added.

Munich Re tends to focus on “augmented automated underwriting processes,” or systems that put automation in the service of a live-human underwriter.

Munich Re surveys its customers every quarter on a variety of subjects, and it uses those surveys to see how Munich Re technology is affecting its customers’ operations, Kennedy said.

Customers say modernizing underwriting systems is helping them get bigger quickly, respond to distributors more quickly, and increase new business, Kennedy said.

“The technology is providing growth opportunities, and quicker processes, and, presumably, resulting in lower internal costs,” Kennedy said.

2. Munich Re is watching for any effects automated underwriting may have on risk selection.

“The reality in the U.S. life insurance market is that applicants can go through either an automated underwriting path or a traditional path, and it is very important to understand how the drivers of risk selection in both circumstances translates into a price,” Kennedy said.

3. Applicant honesty is an issue.

“One of the key drivers of risk is the accuracy of applicant disclosure, especially in an automated underwriting world,” Kennedy said.

Munich Re is constantly looking at ways to mitigate applicant disclosure accuracy risk, through new processes and new data, to try to make the information an automated system gets similar to the information a traditional underwriter would get, Kennedy said.

 

 

 

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