COVID-19 And Life Insurance
The pandemic is a game-changer. There’s no way around the evidence: closed schools, stock market volatility, shuttered small businesses, and a swamped healthcare system. With civil discourse at an all-time low, we might need to wait for history to decide what happened.
With every sea change comes opportunity; some industries have found a boom amidst the chaos. Courier and logistics services have experienced massive growth with online shopping and doorstep deliveries. Online education is in the midst of an unprecedented heyday. Video streaming services exploded during the initial Spring lockdowns; production teams are now scrambling to keep up with demand in a forever changed television landscape. Another pandemic-time growth industry: life insurance.
The significant rise in policies sold during 2020 is especially notable because it reverses a decade-long downturn. Between 2010 and 2020, the number of Americans holding a life-insurance policy dropped from 63% to 54%. That’s 16 million less people over ten years, even though the country’s population grew by 21 million.
Declines in the number of Americans holding a life insurance policy have been something of a mystery. Life expectancy has steadily increased, but fewer Americans were choosing to buy policies. One would reasonably assume ownership to rise among middle and lower-level earners, but that’s not what happened. Experts point to factors like declines in group policy sales, higher premiums, and more restrictions for an older population, though they don’t really explain the failure to reach younger generations.
Whatever caused the slump, it might be over. The second and third quarters of 2020 have shown sharp increases in policies sold, some months with double-digit percentile increases over 2019. Americans see that good health and a long life is no longer something we can take for granted as COVID-19 has increased our awareness of our own mortality. Daily reminders of tragic losses and spiraling infection rates have set off a round of panic-buying the country has not seen since 9/11.
A new landscape comes along with some new restrictions. Insurers cannot deny claims due to COVID-19, but many firms are restricting underwriting for certain at-risk groups. Individuals over 60 with heart or lung issues, diabetes, or obesity might encounter raised premiums or denials. For individuals over 70 options are even more restrictive.
Finding out your options has never been easier. Online marketplace applications use reflexive questioning to customize each application in a manner that satisfies underwriters. Behind the scenes, medical records are retrieved electronically allowing policy decisions in just moments. Naturally, prospective buyers like the ability to compare rates and options with such immediacy. Growth during the pandemic would have encountered bottlenecks and obstacles with the industry’s old model, which required meeting with an agent and scheduling a doctor’s appointment.
The industry’s new model relies on next-generation application and underwriting processes from firms like Management Research Services (MRS). MRS offers customized insurance underwriting solutions to support a range of insurance services. We can assist with your new business applications and underwriting processes through our proprietary technology and no-code platforms. Together, the MRS no-code technology and services represent a one-stop solution that reduces customer acquisition costs and saves time and overall resources for insurance carriers.
No one can say if or when the pandemic will end. Virus experts contend COVID-19 might never go away, but vaccines and treatments will turn it into something much easier for all of us to live with. As things change, MRS’s flexible system can and will change with it. Our technology is built to allow for progressively more complex underwriting and scripting scenarios. For more information on how MRS is helping insurance companies look toward a better tomorrow, visit their website at www.managementresearchservices.com .
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