In a world where consumers demand
quick service, life insurers are lagging badly on service delivery,
believes The Hartford. To remedy this shortcoming, the US insurer
has introduced Issue First, a solution it claims reduces the time
required to issue a permanent life insurance policy from 48 days to
five days.
“Today’s consumers are used to
buying products online and receiving them at home within 48 hours,”
said Brian Murphy, head of The Hartford’s life insurance division.
“We see no reason why they should have to wait more than a month to
receive a new life insurance policy.”
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Murphy continued: “By creating a
new way of assessing a person’s risk factors and reordering the
underwriting process, we can now provide consumers with life
insurance coverage in a fraction of the time it used to take.”
The Hartford experienced a positive
response from consumers during a pilot of Issue First conducted
earlier this year. Of people who applied for a policy using Issue
First, 90% went on to buy the policy compared to 68% of consumers
who purchased a policy using the traditional selling approach.
In an explanation of the basics of
the Issue First solution, The Hartford noted that it issues the
policy to consumers before it completes the normal underwriting
process.
“Issue First reverses the order of
the process by asking the consumer eight critical questions up
front,” stated the insurer. “If they can honestly affirm all eight
questions, they receive coverage on the spot that cannot be revoked
because of an unforeseen medical condition. Only then does the full
underwriting process begin.”
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By GlobalDataAdvisers using the Issue First
solution provide prospective buyers of a permanent life policy an
estimate of the premium that will apply. According to The Hartford,
the final premiums on more than 95% of policies completed during
the pilot were either the same or less than the original
estimate.
The Hartford has patents pending on its Issue First
solution.
