A Game-Changing Shift Has Occurred in the Insurance World

The way insurance companies are approving insurance policies for prospective clients is going through a big change. Up until recently, to get a life insurance policy, one must go through extensive medical examination, including blood and urine samples and any other potential hurdles you can imagine.

As we move forward in 2018, a handful of companies are creating waves in the insurance world, pushing the envelope for innovation with the application processes. The game-changing shift is towards accelerated underwriting. What this means is those applying for a life insurance policy are not required to go through a full paramedical examination.

Instead, companies supplement the exam with interviews and background checks which still go through medical records. Companies are also using new innovative technology to predict mortality and risk rate.

TrueRisk® is one of those new technologies by created TransUnion. It is a credit-based insurance score that gathers credit history from people over a ten-year period. This information can be used to predict patterns for assessing a life insurance applicant’s mortality risk.

The result is a decrease in the underwriting process requirements, which means customers can receive insurance policies at a much quicker rate, without the need for labs.

However, accelerated underwriting is not a guarantee for everyone. In addition to an application in good order, the applicant must go through a questionnaire to qualify for the quicker process. They must meet specific criteria, like being a non-smoker and no pre-existing medical conditions.

Still, the fact that this technology even exists shows how the insurance world is changing. Applicants can get coverage at a much quicker rate than ever before. In return, the companies get new clients on the books faster and may see a lower attrition rate.

But not every insurance company is taking part in offering accelerated underwriting and using these types of technology. Since this is still considered new territory, some are hesitant to evolve. However, there are many willing to make the change.

Insurance and Estates recently published an article on automated accelerated underwriting companies. “Top 10 Best Accelerated Underwriting Life Insurance Companies for Cash Value Growth” is a list of these innovative companies that no longer require the old way of ensuring clients – medical examination. The companies had to meet the following criteria:

  • They must provide accelerated automated underwriting as an option;
  • Their policy needed to present cash value accumulation as a valuable addition;
  • The company must be a top rated insurance company.

Three companies in the top 10 list include Penn Mutual, Foresters and Brighthouse Financial.

Penn Mutual’s automated accelerated underwriting allows qualified applicants to receive insurance approval in up to 24 hours. Forester’s offers non-medical underwriting for applicants that satisfactorily answer the required application questions and background checks. Brighthouse’s accelerated underwriting replaces the medical exam in part with a phone application, among other requirements.

What does this mean for the consumer? Although it doesn’t guarantee the best policy for theclient, if someone is qualify for accelerated underwriting, it does mean they have access to insurance products, including cash value life insurance, at a much faster rate than before. There is no additional costs and no hidden fees. The client will still be getting high-quality policies as before, just at a quicker pace.

These companies are paving the way for future technology discoveries to improve insurance applications for years to come. As our world continues down the fast-paced road, companies need to keep up with the changes, and accelerated underwriting does just that.

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