The life insurance purchase process as it exists today is messy. Deciding on a policy requires navigating a maze of carriers and questionnaires, adding layers of difficulty to a conversation that consumers aren’t typically super excited about in the first place. As a result, the number of households holding life insurance is currently at a 50-year low.
According to a 2018 Deloitte report, this is largely due to the life insurance industry’s difficulty to keep up with the demands of the modern consumer. For many insurance companies, generating quotes is still a bespoke process. Data collection is frustrating and inefficient for brokers, who manually gather customer responses to underwrite decisions and are still often left with rework when details are provided incorrectly. This lengthy and inconvenient process often causes customers to abandon the application process altogether, resulting in the current never-before-seen life insurance lows.
A digital platform that helps brokers collect and analyze data more effectively would lower costs, level the playing field for direct insurers, and meet customer expectations for seamless multi-carrier research and quotes. But despite prioritizing the development of digital services, insurance carriers have yet to successfully automate cross-carrier quoting and fulfillment. So why hasn’t this been solved yet?
The Complexity of Cross-Carrier Assessment
Ideally, brokers would be able to generate instant quotes by using a cross-carrier platform that receives applicant data and enables instantaneous comparison of carrier prices. But in order to meet consumer demands for market comparison, a platform must be able to translate customer data into disparate metrics used by different carriers. Until recently, attempts to create a platform for cross-carrier quote generation have crumbled under the idiosyncrasies of the various metrics. The closest attempts were digital catalogs of paper forms.
These efforts at digitization have been an ongoing problem in the insurance industry for over 30 years, during which carriers have tried and failed to build the complex rule set required to automate this decision process. In fact, brokers exist partially because of this very complexity — customers need a mediator to guide them through these tough decisions.
Brokers indeed serve a critical role in this process — according to the same Deloitte survey, over 75% of life insurance purchasers still find brokers a helpful part of their purchase decisions. But brokers are often forced to spend too long making comparisons based on insufficient data instead of focusing on finding the right option for the applicant. Instead of receiving the guidance they need, applicants are often simply steered toward the low-cost option. To make the most of digital technologies, insurance carriers would benefit not from developing direct-to-customer pricing channels, but platforms that accelerate and streamline broker tasks to everyone’s benefit.
No-Code Can Automate Fulfillment
Fortunately, a new type of application development has finally been able to offer a long-awaited solution to this problem. By using no-code, carriers can now successfully build a cross-carrier platform that significantly improves the intake and underwriting process, as well as cross comparison quoting. A unified platform developed with no-code can introduce a common set of questions routed through all carriers and, with automated decisioning, chart a path to the best carrier for each applicant.
By using digital questionnaires, companies are able to eliminate certain costs incurred through broker channels. These digital questionnaires also allow for reflexive questioning, which can use provided customer information to remove irrelevant questions where possible. Instead of jumping back and forth between many complex forms across carriers, insurance options are streamlined to help brokers guide customers to the right quote. Applications can be vetted in real-time with background checks, preventing costly errors for carriers. And a digitized vetting system will allow carriers to prevent not-in-good-order (NIGO) applications — meaning that applications no longer have to come to a standstill due to logistical errors or typos.
Most importantly, all of these benefits will add up to a completely new paradigm for the broker-customer relationship. By reducing inefficiencies, using automation for tedious tasks, and comparing quotes through an easy parallel process, brokers are empowered to truly do what they were hired for — help customers.
Purchasing life insurance is crucial for the financial health of many American families, and deciding on a plan can be an especially challenging and personal process. The future of the industry will depend on the seamless cooperation between applicants, brokers, and insurance companies. No-code app development provides the game-changing, user-friendly experience that life insurance so desperately needs.
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