25 minutes. That is all it took for a client to be approved preferred plus for $1 million of life insurance. 25 minutes from the time I got off the phone to solidify her insurance design to getting the policy approved. The following day, the case was issued and then within minutes of our delivery videoconference meeting, the policy was inforce.
Accelerated underwriting has been around for a few decades. The only difference now is that Covid-19 forced many carriers and insurance advisors to adapt to fact that business could be processed from start to finish remotely. My client who was approved within minutes of my presentation is no longer an anomaly.
What is accelerated underwriting? Depends on who you ask. Simply put, it is not your traditional way of underwriting and it also is NOT for everybody. To qualify, the client must satisfy the carrier pre-requisites based on health, age, face amount and product. Most programs require MIB, RX and MVR checks. Some carriers add their own “requirements” and a caveat stating: “everything is at the discretion of the underwriter”. Some pull random cases out of the program and move them to traditional underwriting even if the client qualifies.
What products are acceptable? Permanent and term insurance. Some carriers allow one, both or very specific products.
What is the turnaround time? They range from instant approval up to 2 weeks.
What is the maximum face amount eligible? Most carriers allow up to $1M, some up to $2M and a couple that allow up to $3M.
What ages & risk classes qualify? Mostly between ages 18 to 65 with a couple of carriers allowing up to age 80. Risk classes are discussed below.
How do you submit applications? Paper, e-application, customized URL, “drop tickets”, phone interviews or any combination of such. Some carriers mandate how they want you to submit to qualify for their program and some give you the freedom to choose.
How do you deliver policies? Policies are delivered online and all signatures are procured electronically or via services like DocuSign. Some carriers will automatically mail a hard copy to the insurance advisor or sometimes only if requested.
While accelerated underwriting is not for everybody, today’s successful advisor must be well-versed in all aspects of it. The investments that carriers have put into technology and the process overhauls that has been done due of the Covid-19 pandemic, warrant a second chance if you had a bad experience with accelerated underwriting in the past.
Here are my top 5 key pointers for insurance advisors to remember when utilizing accelerated underwriting programs:
Always do your due diligence and what is in the client’s best interest. Thorough field underwriting is key to avoiding unpleasant surprises.
· Carrier A may offer a client with a family history of heart disease preferred plus but carrier B may not. Asking the right questions and the tough questions are critical.
· The last thing you want is for your client finish underwriting then only to realize AT THE END that one simple question IN THE BEGINNING such as “Have you had any DUI or DWI in the past 5 years?” may have pointed you to the right carrier that would give the client a better offer than the “spreadsheet winner” you picked.
Explain the process to your client. Make sure to go over expectations and answer any questions your clients may have regarding the carrier interview and the overall process.
· By the time the client is being interviewed by the carrier representative, they should be aware of who they should expect a call or email from, what they're buying and what will be covered during the interview.
Learn how to use video conference applications. It helps when communicating with your clients and it also satisfies most carriers’ “face to face” requirements.
· With stay-at-home orders, it is vital that you “see” your clients. Use any of the many video capable services and devices out there.
· Share your screen with you clients when showing them proposals and designs. While video can never replace in person meetings, seeing your client on video
Process new business remotely and securely. Security and confidentiality are paramount to your success so you must have a way to communicate and transmit electronic documents securely.
· One of the biggest mistakes you can do is to be cheap when it comes to hiring a technology person that you end up signing up for the latest and greatest but not exactly what you need. Do not just find a “halfway decent” technology person. Find a true competent one. One whose work speaks for itself.
· I once worked with a very successful advisor who plateaued in his career. When I tried to explain to him that his way of doing business is obsolete and that he should “invest” in a competent technology person, he resisted with all his might. Are you wondering what happened to him when Covid-19 hit??!
Be comfortable using online resources to check and follow-up on your cases. Nobody likes it when someone calls at 4:58 pm asking for case status or forms needed for a 5:30 pm appointment. I repeat, nobody! Learn how to use the carrier website, check and follow-up on your cases to avoid having the desire to chase down Home Office staff very late in the afternoon or after business hours.
Know that sometimes, accelerated underwriting is not just for the super young and super healthy. Taking advantage of these programs could prove to be very beneficial for the insured when utilized properly. It makes the insurance procurement process much shorter and a more modern experience. I enjoy putting my clients through 90+ days of underwriting said no one, ever.
If you are an advisor or a client and would like to know how Accelerated Underwriting could benefit you, email me at firstname.lastname@example.org
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