When life insurers set their underwriting requirement practices, the primary focus has always been on protective value (cost vs. benefit). In many smaller companies lacking the resources to conduct internal studies, the usual approach is to consider the practices of larger carriers and most notably those known to routinely do such studies.
This video probes critical issues related to the acquisition and use of underwriting engines. These engines accommodate straight-through processing of new applications, making some portion of insurability determinations without the need for underwriter intervention.
Present life underwriting practices for marijuana use are deeply flawed as a result of three factors:
1. A lack of systematic research
2. Entrenched misperceptions
3. Government-incited disinformation
This essay provides extensive evidence that current marijuana use practices need to be fundamentally changed.
People stop consuming alcohol for a variety of reasons.
Some of those reasons – for example, joining a religious group where alcohol use is frowned upon or finally capitulating to nagging by a teetotaling spouse – have no insurability implications.
Underwriter audits are indispensable resources for chief underwriters. While not the only basis for assessing performance, they are the single most significant benchmark where line underwriters are concerned. It would be essentially impossible to manage underwriters without having sufficient insight into their performance on the job.
The age of underwriting engines – defined as straight-through processing of some portion of an insurer’s new business – is at hand.
Even in the United States, where life underwriting is relatively more complex for a variety of reasons, we know now that almost 20% of carriers have an engine in place and the majority of the rest are either in process of acquiring/building an engine or at least studying their options in this regard.
Underwriting rules engines are attracting more and more interest from life and disability insurers looking to address three key issues:
• Streamlining the new business process for improved service to customers and advisers
• Improving risk management and consistency of underwriting in the face of a shrinking pool of technical skills
• Generation of better management information with the twin goals of improved profitability and satisfying increasingly demanding regulation.
This report, produced by SelectX Ltd and Hank George Inc., reviews the latest developments in rules engines and defines the critical factors that define successful engine implementation and maintenance.
To provide a background the report draws upon a worldwide survey of 179 insurers carried out by SelectX and Hank George Inc. in 2011.