Big data is playing a prominent role in life insurance this year.
Interest in coverage has surged during the pandemic, but for many people, social distancing mandates took the life insurance medical exam off the table. As consumers look for quick, noninvasive ways to buy policies, insurers have turned to accelerated underwriting, a process that uses big data and algorithms instead of exams to evaluate applicants.
While accelerated underwriting isn’t new, more than a third of life insurers have expanded it due to the pandemic, according to a study by the Society of Actuaries. And no-exam life insurance appeals to many people. “They want it to be fast and easy,” says Gina Birchall, chief operating officer for the life insurance trade group LIMRA.
How accelerated underwriting works
Companies typically use accelerated underwriting to fast-track healthy people’s applications. But now, they are offering it to consumers who are social distancing. Low-risk applicants are approved based on big data, while requiring medical exams for everyone else.
One big perk is that you still get fast-tracking. It takes around nine days for an insurer to reach a final decision using accelerated underwriting instead of the traditional 27+, according to LIMRA.
How much do you want to pay?
For people in less than perfect health, a policy with full medical underwriting is likely to be the cheapest option. But if you are in good health and wish to stay that way by avoiding the Covid-19 risk of exams, most insurers will offer contactless, accelerated underwriting to fast-track your application. Your price and product will likely be the same as if you had taken the exam.
You can get instant, term life quotes from dozens of A-rated life insurance carriers who offer accelerated underwriting at QualityTermLife.com.