A Glimpse Into Our Elderly Underwriting Survey Results
Since 2008, Gen Re has tracked risk selection practices among elderly applicants in the U.S. individual life insurance market. We conducted our most recent survey last year. This topic remains highly relevant, as indicated by the participation of 54 companies. Gen Re issued the survey analysis and report to those companies in February. The full survey will be available to interested non-participants in August.
A prominent focus of the survey is the use of screening tools for cognitive function and frailty. Gen Re was an early advocate for the use of these assessments because cognitive impairment and frailty are common, nearly invisible in medical records, and markedly increase mortality risk. It is relatively easy for potential beneficiaries to seek life insurance on their aging parents when they detect these problems. Weak underwriting assessment may have encouraged the flood of stranger-originated life insurance (STOLI) business 10 to 15 years ago.
Here is a glimpse into the results of the latest survey: Only 50% of respondents use a cognitive function screening assessment. These companies gain a considerable advantage that translates to lower mortality. The non-users remain vulnerable to anti-selection.
Other facets of our picture of medical underwriting in the elderly marketplace include the specific assessment tools and mechanism of risk selection, and the prevalence of biomarker tests.
The survey addresses nonmedical underwriting as well, such as estimates of the growth of business volume, structure of preferred classes and consideration of financial eligibility.