Simplified underwriting is one way life insurers can reconnect with reluctant buyers
LIMRA research shows there are about 19 million “stuck shoppers” – potential life insurance buyers who start the process but never finish. To help combat this issue, many companies are implementing simplified underwriting processes to lower costs and improve customers’ buying experience.
LIMRA finds only 15 percent of all U.S. households shop for life insurance in a 24-month period. Of those, just two-thirds actually get a quote for a life insurance policy. A possible deterrent can be the time consuming and complicated nature of the full underwriting process. Fifty-two percent of potential life insurance buyers said they would be more likely to purchase life insurance if they didn’t have to go through a physical exam, according to the 2018 Insurance Barometer Study by LIMRA and Life Happens.
While life insurance sales are stable, life insurers are looking for ways to better engage the 60 million households that are uninsured or underinsured. Prior LIMRA research finds 9 in 10 companies either have or are in the planning stages to develop automated underwriting programs. Additionally, three quarters of those who have implemented automated underwriting say their companies have achieved their goal of reducing the time it takes to issue a policy.
The Impact of Simplified Underwriting on Life Insurance
Fifty-two percent of potential life insurance buyers said they would be more likely to purchase life insurance if they didn’t have to go through a physical exam according to the 2018 Insurance Barometer Study by LIMRA and Life Happens. While the decline in life insurance sales has flattened off, insurers are looking for ways to grow the market.
LIMRA Unplugged is a video podcast series designed to explore issues and trends within the financial services industry. The series combines LIMRA research with real-world insights to offer an in-depth understanding about market challenges and opportunities.
In the latest episode of LIMRA Unplugged, LIMRA Research Director Alison Salka talks with Jim Scanlon, LIMRA life insurance research director, about the impact of simplified and underwriting. To watch the video podcast please visit: The Impact of Simplified Underwriting on Life Insurance.
LIMRA, a worldwide research, learning and development organization, is the trusted source of industry knowledge, helping more than 850 insurance and financial services companies in 64 countries. Visit LIMRA at www.limra.com. @LIMRANewsCenter