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.
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.