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TELEUNDERWRITING 2010

TELEUNDERWRITING 2010. Presented to NAILBA Conference Chicago – May 13, 2010. Hank George, FALU. Essential Definitions. Teleinterview – gathering the risk history over the telephone in lieu of traditional methods Teleunderwriting – the use of teleinterviews in risk appraisal

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TELEUNDERWRITING 2010

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  1. TELEUNDERWRITING2010 Presented to NAILBA Conference Chicago –May 13, 2010 Hank George, FALU

  2. Essential Definitions • Teleinterview –gathering the risk history over the telephone in lieu of traditional methods • Teleunderwriting –the use of teleinterviews in risk appraisal • Drilldown –additional questions in response to allYESanswers on teleinterviews…to amplify the specific history acknowledged by the applicant

  3. 2009SCOR Global Life ReGLOBALTELEUNDERWRITING SURVEY(conducted by SelectX and HGI)

  4. 70Core Questions • 6Continents • 7Languages • 360GlobalRespondents • 104 North American Respondents

  5. Why Teleunderwriting? Mature Markets Speed up app-to-issue Reduce business acquisition costs Reduce APS dependency New Markets Minimize agent involvement Reduce nondisclosure/antiselection Improve customer service

  6. Mission Accomplished? USA SCORE CARD Speed up issue ++ Costs+/- APS use+/- Agent involvement - Nondisclosure/antiselection+++ Customer service++

  7. The rest of this contentrepresents North Americanresponses only

  8. Is Teleunderwriting Being Used? • YES 64% • NO Being piloted3% Being considered15% Not considered yet14% Stopped2% Rejected 2%

  9. 43%have been doing teleunderwriting 6 or more years • 12%take ALL histories via teleunderwriting; 27% take MOST; 61% take SOME • 57%use teleunderwriting < age 18;83%after age 65;92%between 19 and 65 • 68%at ALL face amounts • 59%REDUCED paramedical use due to teleunderwriting

  10. APS Reduction? • None 18% • Increased Use5% • Decreased < 10%27% • Decreased 11-20%25% • Decreased > 20%7% • Unknown18%

  11. Why So Dismal? #1Underwriters reluctant to forego APS for concern over audit outcomes #2Disconnect between drilldown content and underwriting manuals

  12. Cycle Time Reduction? YES63% • > 10 days 8% • 4 – 9 days 17% • < 4 days 17% • Yes – details unknown 21% NO 32% • No impact 18% • Increased time 14% UNKNOWN 6%

  13. In-House or “Out-House”? All outsourced 56% Most outsourced 8% All inhouse 27% Most inhouse 8% Split 50:501%

  14. How Long to Completed Interview? 1 day14% 2 days18% 3 days29% 4 days9% 5 days or longer25% Unknown 5%

  15. Who Does Your Interviews? Call Center59% Underwriter 21% Underwriter Assistant11% Nurse3% Other 6%

  16. “Off-Script” Interviews • YES – unscripted5% • YES– routinely17% • NO 78% American outsourced teleinterview providers need to develop “off-script” capacity!

  17. 72% do NOT seek client feedback on interview experience • 89% of companies that get feedback from clients…get positive feedbackClients PREFER teleinterviews as the mode of risk-history taking! • 58% of companies now use voice signature • Most of the rest still get wet signatures

  18. Where are the BESTOutsourced Teleinterviews Done? United Kingdom • 90% done by nurses or underwriters working for outsourcing companies • 100% go off script as needed • Most advanced use of healthy habit and “healthy-adherer effect” questions

  19. Shortfalls on Tobacco Questioning • Bidis • Cloves (Kreteks) • Hookah (Narghile, water pipe) • Betel • Amount per day • Years of smoking

  20. Assessment of cigarette smokers over age 50 should be augmented by pack yearsof consumption.This is just starting to be doneSee my Pack Year essay atwww.cholhua.org

  21. Do you get more truthful answers on teleinterviews? TobaccoEverything Else YES76% 77% NO 6% 14% DON’T KNOW18% 9%

  22. Non-Medical SubjectsRoutinely Included Aviation 79% Avocations76% Occupation 73% Foreign Travel67% Citizenship Status59% Military Service35% Financial 42%

  23. Do your producers decide if a given application is submitted via teleunderwriting vs. traditionally? YES 46% NO 54%

  24. Do you permit your producer to be present during the teleinterview? YES 21% NO 44% NO POLICY35%

  25. Perceptions of Teleunderwriting Underwriters Medical Directors Like 74% 49% Tolerate 24% 12% Unknown 2% 39%

  26. % Liking Teleunderwriting Claims VP58% Producers 29%* Marketing VP53% Chief Actuary56% Top Management71% *58% “mox-nix” and 11% hate it

  27. IMPACT on MORTALITY + MORBIDITY Improved 20% No effect9% Worse 1% Too soon to say41% Do not know29%

  28. Rate Total TeleunderwritingImpact in Your Company Very Successful30% Moderately Successful56% Moderately Unsuccessful3% Very Unsuccessful1% Too Soon to Know10%

  29. HGI Surveys • 2007Underwriting Requirements • 2008Preferred Risk • 2009 Global Underwriting Management • 2010Older Age Underwriting • 2010Rx Profile Use • 2011 Underwriting Requirements

  30. Resistance is Futile! NT-proBNP …will be the dominant screening tool for CV Disease risk at ages 55 and over

  31. “The reinsurers won’t allow it!” • They objected to teleunderwriting…and now give pricing credit for doing it • They objected to Rx profiles…and now give pricing credit for doing it Any Questions?

  32. See my definitive paperon NT-proBNPatwww.insureintell.com

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