Hank George, a longtime life insurance coverage underwriter, says life insurers may want gradual, cautious underwriting to guard themselves in opposition to the results of the COVID-19 pandemic.
George makes that case in a commentary printed in Contingencies, a publication put out by the American Academy of Actuaries. The academy is a nonprofit physique that seeks to form and promote the actuarial occupation.
Many academy members are working to assist life insurers scale back use of blood checks, urine checks, and attending doctor statements within the life insurance coverage underwriting course of, to extend the quantity of people that should buy protection rapidly on-line, by means of largely or completely automated underwriting processes.
The academy has a disclaimer underneath George’s article stating that “the views in this article are those of the author and do not necessarily represent the official views of the American Academy of Actuaries.”
George, nonetheless, contends that “accelerated underwriting” or “simplified underwriting” packages may be a poor match for the post-COVID-19 period.
One drawback is that prime unemployment charges may trigger or irritate temper problems, George writes.
- A duplicate of Hank George’s commentary is out there right here.
- An article about shopper group representatives’ considerations about predictive analytics-based underwriting methods is out there right here.
Even with a conventional underwriting course of. “mood disorders reduce life expectancy by an average of eight years in men and six years in women,” George says. “Underwriting psychiatric illness is more difficult than for most medical conditions.”
George says the COVID-19 lockdown may additionally result in a second epidemic: forgone take care of life-threatening problems, comparable to tumors, and strokes.
Hospitals have reported seeing fewer emergency room visits for signs related to coronary heart assaults and strokes, George says.
The dearth of consideration given to these signs “translates to a formidable reservoir of future applicants who should have had proper diagnostic evaluations for suspicious symptoms of mainly chronic and usually progressive cardiovascular diseases,” George says.
George doesn’t speak intimately in regards to the chance that COVID-19 might give some individuals everlasting kidney harm, coronary heart illness, lung harm, or different severe continual situations. However he cites stories that about 80% of people that have acquired intensive take care of COVID-19 go away with unresolved well being issues, and that these individuals’s threat of affected by continual incapacity may be as excessive as 50%.
In a conventional underwriting course of, attending doctor statements may be supply of details about temper problems and different continual well being issues, together with most cancers, however “we are far less included to pursue attending physician statements in 2020 than at any time in the past 50 years,” George says.
Lack of blood checks may make detecting pandemic-related ingesting issues harder, George says.
George says an absence of enough underwriting info, and a rise in well being threat, might result in “an unprecedented, self-imposed underwriting apocalypse” over the following 5 to 10 years.
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