How digital underwriting is on the fast track at Prudential

It’s the year 2030 and Janice wants to buy life insurance. She searches online to purchase a policy in a nearly Amazon-like experience. She enters data about herself and her health, and a combination of robotic and human intelligence assesses her case and presents her with a customized solution. And she’ll face no invasive tests.

But that’s not even the most remarkable way technology is transforming our industry. For Janice and her cohorts, the underwriting behind her policy will follow her and continuously adjust to her lifestyle changes – offering her new coverage and underwriting pricing dynamically.

Artificial intelligence and predictive modeling based on vast amounts of data about customers will create informed and realistic solutions for them based on a point in time. For example, a smoker who purchases a policy today will benefit if they quit smoking and adopt a healthier lifestyle down the road. Ultimately, by implementing continuous, data-driven and effective underwriting, our industry can help people make better decisions and live healthier lives.

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Prudential's Newark, N.J. headquarters.

And that is likely just the beginning. The data available about consumers is so vast and proliferating so quickly that there are sure to be trends and correlations we just don’t see yet in terms of how people live their lives and how long they’re living.

That shouldn’t be a surprise. Emerging technologies are being driven by new entrants into the field. Virtually every company in this industry has or will introduce some form of automation in the coming years. The emergence of insurtech firms like LadderLife, Bestow and Haven Life are driving automation, offering easy online experiences.

Data is being collected in myriad ways. Additionally, reams of medical data are quickly becoming available online, including clinical lab results, attending physician statements, health claims and facial analytics.

Wearable technology also tracks and collects an infinite amount of data about ourselves. A single device can now track our steps, heart rate, blood pressure and other information.

And as insurance becomes a more data-driven experience, we will soon give customers nearly instant, and continuous, underwriting decisions. At Prudential, for example, we’ve developed PruFast Track, a new underwriting process for individual life insurance, with a more customized and streamlined approach that can return approvals within days or even hours.

As these technologies continue to advance, it’s an opportunity to improve the underwriter’s role. Artificial intelligence and technology will assume much of the manual underwriting processes such as ordering tests or checking to make sure applications are filled out properly. And where there is less risk, such as with small face amount term policies, automated processes will help to ensure efficiency and accuracy. This will allow the underwriter to focus on more complicated cases where their years of experience play an important role in risk protection.

The key challenge is to accelerate the process without sacrificing the value traditional underwriting adds from a price perspective to the consumer and the risk protection it provides the carrier.

As an industry, we have an incredible – and game-changing – opportunity, and getting this right is critically important because underwriting is essentially predicting the future transformative nature of a thousand points of data on underwriting allows us to be more targeted and effective in serving our customers. It also leads to greater profitability because of increased efficiency.

As new data sources come online, the “Underwriting Manual” must become more dynamic and less prescriptive. The key to getting this right will be to act wisely, but rapidly, in harnessing the available and burgeoning data and new technologies. The stakes are high in terms of the impact on consumers and trust in our industry. The firms that do, either individually or in partnership with new entrants, will flourish.

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