Gen Re shared the findings of its 2024 Individual Life Accelerated Underwriting (AU) Survey, highlighting trends in the adoption and operation of AU workflows.
The 2024 survey saw responses from 38 life insurance carriers, revealing that most (82%) have either fully or partially implemented an AU workflow. Another 10% plan to implement AU workflows within the next two years, while a few carriers indicated no current or future plans for such a workflow, citing technology limitations, concerns over mortality slippage, and costs among other barriers.
For companies with implemented workflows, the duration of workflow use varied. Fully implemented workflows ranged from less than a year to over a decade, with newer pilot programs typically running for less than three years.
Most carriers with AU workflows report mandatory paths for applications meeting eligibility criteria, although some allow agents or clients to opt out. A significant majority (81%) indicated they are meeting AU program goals, such as reducing time to policy issuance and managing mortality slippage. Just one company reported exceeding these goals, while 16% cited challenges in meeting them.
To assess AU program success, 94% of companies track AU throughput percentages, with other common metrics including days to issuance, placement rates, and mortality slippage.
Companies offering AU workflows generally provide four non-tobacco and two tobacco underwriting classes, with classes ranging from three to eight for non-tobacco and one to three for tobacco categories.
On average, insurers using AU workflows report an 18-day reduction in underwriting time, bringing the process down to five days from application submission to final decision, compared to 23 days for full underwriting.
Eligibility for AU extends to 57% of individual life applications, with 14% approved automatically and 36% approved following human underwriter review. Of the eligible applications sent through automated workflows, an average of 17% proceed with 83% approved automatically, 9% declined, and 8% marked incomplete or pending.
Human review remains a critical component, as 83% of AU applications undergo underwriter evaluation. For these, 43% gain approval, 8% are declined, and 39% are returned for full underwriting. Ten percent of cases require additional verification, such as an Attending Physician's Statement (APS), before final approval.
Among product types, 94% of companies make term life insurance available through AU workflows, followed by universal life at 63% and whole life at 56%. Common exclusions for AU eligibility include specific states, citizenship, product types, and distribution channels.
The survey also examined control practices, with 91% of companies implementing or planning to use pre- and post-issue auditing in AU workflows. Popular controls include random holdouts (63%), post-issue APS (47%), and electronic health records (41%).
Over half (56%) use random holdouts to estimate mortality slippage in AU workflows, while 38% monitor early claims experience.
Survey results indicate that 34% of companies made significant changes to AU workflows in the past year, including new data sources, simplified applications, and model-based decision-making.
Most companies (81%) handle workflow changes internally, with 35% working with reinsurers and 16% engaging vendors or consultants.
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