Ever wonder why certain companies can underwrite and issue some policies in a matter of days, while it takes other companies weeks and even months?  Companies that have invested in modern technology, utilize innovative underwriting approaches, and have reduced or eliminated their use of paper, have been successful in significantly reducing the underwriting and policy issue turnaround time.

Depending on the product, various combinations of new tools are being utilized to speed up the underwriting and policy issue process without sacrificing mortality:

·         Personal History Interview (PHI) – Performing PHIs with drill down questions if adverse information is uncovered has substantially reduced the number of time consuming APSs that may be required.

·         Medical Information Bureau (MIB) – This data base has long been used by insurers and continues to be utilized to obtain information electronically on medical conditions that are disclosed on applications of other insurers.

·         Motor Vehicle Records (MVR) – Most state make this information available electronically and therefore can be obtained by insurers in less than 24 hours.  MVRs are inexpensive and can provide valuable underwriting information, particularly for younger applicants who have a higher incidence of accidents.

·         Pharmaceutical Data Bases – Coupled with information from other sources, adequate information may be collected electronically that will eliminate obtaining additional medical information from other sources. 

Utilizing an expert underwriting system that can automatically evaluate applications and collect information from these various data bases, may result in an underwriting decision being reached in a matter of minutes.  Companies are also experiencing efficiencies from the following:

·         Encouraging producers to email or fax applications to the home office.  Doing so eliminates as many as 5 days of mail time and allows the underwriting process to begin immediately.

·         Suggesting that the initial premium payment be paid by an electronic preauthorized premium from the applicant’s bank account.

·         Utilizing work tracking and the imaging of documents which allows documents to be viewed by more than one person and to be tracked as they move within an organization.

·         Preparing policies from real time administrative systems that allow changes to be made immediately and policies to be printed and assembled with limited manual intervention.

Naturally, the type and size of policy being applied for will impact the underwriting requirements and the underwriting process.  However, before agreeing to do business with a company, you may want to better understand the company’s underwriting approach.  Assurity Life Insurance Company currently utilizes all of the techniques mentioned in this article.  Assurity markets 5 plans with face amounts ranging from $5,000 to $250,000 that guarantee a policy being issued and mailed within 4 business days of a qualified application being received, or the writing agent is paid an additional $100.00.  A 99% success rate has been experienced to date.

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