An underwriter's view: ‘Improving access to insurance is hugely important to us’

As underwriting restrictions brought in during the pandemic are rowed back, Insights Hub finds out more about recent Vitality changes, why improving access to insurance is a priority and what’s next for advisers.

A sustainably low coronavirus infection rate, the government roadmap out of lockdown and the successful vaccine roll-out have all led the way for what many advisers have been wishing for since the start of the pandemic: the removal of many of the underwriting restrictions brought in for protection policies as a result of the Covid-19 crisis.

Vitality updated its systems to reflect a raft of changes to its application process to allow for increased access to insurance for customers. While the vast majority have been able to get cover during the pandemic, improving underwriting inclusivity remains a core principle for Vitality and its underwriting & claims team. Something reflected by involvement with some recent high-profile industry initiatives, such as the Explaining Underwriting Decisions agreement and the Association of British Insurers’ (ABI) Mental Health Standards.

In light of this and the recent updates, we caught up with John Downes, Director of Underwriting and Claims Strategy at Vitality, to hear more.

What recent changes have been made to Vitality’s approach to protection underwriting and why?

“Owing to the progress of the vaccination programme and the decrease in Covid infection and mortality rates, VitalityLife has reviewed its underwriting philosophy and believes the time is right to remove the majority of the restrictions put in place at the height of the pandemic.

“Restrictions were placed on the maximum ratings that could be offered on a number of chronic conditions which were thought to be at an additional increased risk owing to Covid. We will now be offering our normal maximum ratings for these applications. Restrictions were also placed on some older lives, mainly those aged 65 and over and these will now also be removed in most instances, though some caps will remain at high levels of cover (above £3m), affecting relatively few applications. Our automated underwriting rules and SPECTRA, our pre-underwriting quote tool, have been updated (as of Wednesday 26 May) to reflect the changes.”

At what point can advisers expect Vitality to return to a pre-Covid approach to underwriting?

“While we are hopefully not far from it, it’s difficult to be precise on an exact date. However, as the vaccination programme continues to roll out and transmission rates decrease, we might expect any remaining restrictions to be removed towards the end of the year but that also depends on what happens after 21 June. It seems there is also likely to be a booster vaccine programme to improve immunity and counter any virus mutations. Hopefully this allow us to return fully to pre-Covid underwriting levels.”

What percentage of customers have been offered cover by Vitality throughout the pandemic?

“Roughly 95%. The changes would have affected mainly those for whom we required additional medical evidence and at the height of the pandemic, we were unable to have nurse screenings, for example. However, we were still able to obtain GP reports (GPRs) and therefore able to offer cover even if with a rating. Most of those affected would have been high-value applications.”

Are any other aspects of the underwriting process under review?

“Our underwriting process and philosophy is constantly under review and changes are made several times a year to the underwriting rules both to improve straight through rates and risk management generally. There are some potentially major changes upcoming in the next review, in areas like mental health. In addition, we continue to expand our Evidence Analyser which is a second level of automation, where nurse screens are captured and downloaded into the rules engine and given a decision without being seen by an underwriter. This is unique to Vitality.

“We are also continuing to roll out our pre-quote underwriting tool, SPECTRA. This tool contains our entire automated rule set to enable advisers to obtain an indication of possible terms without completing a full application or calling the pre-sales team. Because SPECTRA is integrated with our rules engine, it is updated whenever our rules are. There are similar tools in the market but most contain a limited set of rules such as BMI and blood pressure, for example.”

Why is improving access to insurance so important to Vitality and what else is being done to ensure as many customers as possible can get cover?

“Improving access to insurance is hugely important to Vitality, especially with our commitment to health and wellness. Our core principles include not only providing cover for our customers, but also improving their health and wellbeing. We recently signed the Explaining Underwriting Decisions¹  agreement to help ensure customers understand our underwriting decisions more fully, as well as playing an active part in the Association of British Insurers (ABI) Mental Health Standards initiative².

“Expanding on the ABI work there are also initiatives across Vitality to improve the customer experience for those who have conditions other than those involving mental health. In addition to this, we also have our Vitality nurses improving access by travelling to customers’ homes or place of work to carry out screenings. They also provide a tele-underwriting service to help customers through the underwriting process by talking them through medical conditions, which might otherwise have needed GP report (GPR) for example.”

Find out more about Vitality’s approach to protection underwriting and how to access SPECTRA.




Sources:
1. https://www.covermagazine.co.uk/news/4027824/insurers-sign-explaining-underwriting-decisions-agreement
2. https://www.covermagazine.co.uk/news/4020867/abi-unveils-mental-health-industry-standards