AIG upgrades underwriting to increase protection access

LONDON – Monday 27th November 2023 – AIG Life Limited has today unveiled a new Underwriting Rules Engine (URE) and enhanced intermediated underwriting journey that, embracing FCA Consumer Duty principles, helps even more people to get – and understand – the protection insurance they’re buying.

URE’s modern look, improved technology and simpler questions make it even easier for people to apply for insurance and give AIG Life the right information. Customers in turn receive faster decisions so they can take action in their financial lives to prepare for tomorrow.

The new rules engine is built using Swiss Re’s Magnum Pure technology and allows the life insurer’s development underwriting team to make underwriting rule changes agilely. It advances AIG’s underwriting too as new sources of underwriting data can be easily added. Meaning AIG can insure more people, today and in the future.

Over 50 improvements have also been made to the underwriting rules to provide better customer outcomes and increase access to insurance.

Importantly, AIG tested its underwriting questions on consumers and intermediaries. Research found the underwriting journey is well-received but highlighted where minor improvements could be made so customers understand the information it’s asking for – and why.

“Launching the new URE means we continue to be agile and advance our underwriting while making it easy for customers to seek insurance today and prepare for tomorrow,” commented Helen Croft, Chief Underwriter at AIG Life.

“How we’ve done that should also give advisers confidence that we’ve got their backs in relation to Consumer Duty. Our consumer and adviser journey testing ahead of launch is evidence that customers understand the information we’re asking them for, and that we’re acting to ensure good customer outcomes.”

 

Better customer understanding

Keen to ensure good customer outcomes, AIG tested the language, tone and understanding of proposed underwriting questions – then made improvements.

It commissioned qualitative consumer and intermediary research to find out where people may struggle to give the right information and highlight how questions could be improved, after earlier post-issue sampling of applications revealed a handful of questions were not clearly understood by customers.

Testing revealed customers are largely happy with the way AIG asks its underwriting questions, and why. Consumer feedback was that the application journey was straightforward, with a good, natural flow, and they had few issues in terms of wording or understanding, or in the sensitivity of lifestyle questions asked.

Almost all respondents recognised the reason for lifestyle questions and saw them as appropriate.

Help text on how to complete a question, for example, went down well with consumers. Text such as “advice to reduce alcohol intake while you've taken a short course of antibiotics or painkillers can be disregarded” or “we understand this is a sensitive question, it is needed to help us understand your mental health history” has been moved to become part of the question following testing, instead of being provided as help text.

Making sure customers weren’t required to over-disclose was analysed as much as the risk of under/non-disclosure, or misrepresentation. The research found people are keen to disclose fully – and that this journey helps them to do that. Most said they would rather give more detail upfront and know it’s been provided than come across issues later in the application process or, worse, run the risk of a claim not being paid.

In testing, advisers also said the new journey was clear and a positive development – broadly similar to AIG’s earlier approach but with improved detail of disclosure and a more straightforward application.

Qualitative testing was conducted by ID Insight Consulting with 15 consumers and six adviser firms.

 

Swiss Re partnership

URE is an upgrade on AIG’s previous underwriting system and built on a partnership with Swiss Re using their Magnum Pure technology and global experience. The technology will allow AIG to consider what underwriting looks like now and in the future, and consider new ways to assess risk. 

 

50+ rule changes

Adding to its focus on better customer outcomes, AIG has also upgraded over 50 underwriting rules to give customers an immediate decision and reduce the need for GP evidence at the underwriting stage, to increase access to insurance. Many of the questions within the rules have been updated to make them more straightforward and easier to answer.

Using systems thinking and taking an ‘outside in’ view, AIG worked with its front line underwriting team to redesign the underwriting process and rethink what information is needed to underwrite customers, plus how we get it.

The new rules engine will wherever possible give an immediate decision or refer cases to underwriters, who will to assess the risk holistically and see if information from the customer could be used to offer cover. Instead of seeking GP reports at the underwriting stage.

For example, women who were previously diagnosed with diabetes in pregnancy will now be asked more questions, rather than seeking a GP report, and then get an immediate decision.

Common examples of how the 50+ underwriting rule changes will lead to more immediate decisions and more customers insured include:

• Raised blood pressure: more customers get standard rates, including people who have been on medication for less than six months, while individuals whose blood pressure hasn’t been reviewed within last year could be rated instead of declined
• Raised cholesterol: we’ve simplified questions and give more applicants an immediate decision, including on critical illness applications
• Diabetes: customers can now get CI insurance when they might previously have been declined, and there’s less need for GP evidence.

It provides a better outcome for people who’ve had a history of cancer too as more customers will be accepted without a life insurance rating and fewer will be declined for critical illness insurance.

Financial intermediaries can find out more about the underwriting rule changes via the updated underwriting guide available on aiglife.co.uk.

ENDS

 

Notes to Editors

About Corebridge Financial

Corebridge Financial (NYSE: CRBG) makes it possible for more people to take action in their financial lives. With more than $375 billion in assets under management and administration as of June 30, 2023, Corebridge is one of the largest providers of retirement solutions and insurance products in the United States. We proudly partner with financial professionals and institutions to help individuals plan, save for and achieve secure financial futures. For more information, visit corebridgefinancial.com and follow us on LinkedIn, YouTube, Facebook and X (formerly known as Twitter).

 

About AIG Life

Additional information about AIG can be found at www.aiglife.co.uk | X (formerly known as Twitter): @AIGLifeUK | LinkedIn. These references with additional information about AIG Life have been provided as a convenience, and the information contained on such websites is not incorporated by reference into this press release.