Author Topic: New trend - Instant approval life insurance  (Read 6855 times)

Offline ckmk47

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Re: New trend - Instant approval life insurance
« Reply #30 on: March 21, 2017, 12:49:18 AM »
I would imagine they use statistics, and not just make it up. Hence I'm asking if they have evidence that credit is a factor in life expectancy.

I've heard that 'reckless driving' like running red lights and cell phone tickets raises your Life insurance rates.  It shows them that you're reckless and not careful with your life.  Credit rating may also say something about how you run your life.

Offline hachover

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Re: New trend - Instant approval life insurance
« Reply #31 on: March 21, 2017, 11:12:38 AM »
It's great that a lot of people already know about this.

One of the points I want to make is that right now is as easy as it's ever going to be. I wouldn't go so far as to call it a price mistake, but IMNSHO the companies doing this are cutting corners and making decisions without gathering enough data. In the future, the companies will get better at gathering data sources and tiering their prices based on the results. They are operating half blind right now.

If they are willing to give away super preferred pricing to people who may only be basic preferred (because they can't tell the difference yet), why shouldn't you benefit?

I expect to see a huge spike in applications from 08701  ;D
I'm an optimist; but only because life isn't going to give me any other good choices.

Online skyguy918

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Re: New trend - Instant approval life insurance
« Reply #32 on: March 21, 2017, 12:38:31 PM »
It's great that a lot of people already know about this.

One of the points I want to make is that right now is as easy as it's ever going to be. I wouldn't go so far as to call it a price mistake, but IMNSHO the companies doing this are cutting corners and making decisions without gathering enough data. In the future, the companies will get better at gathering data sources and tiering their prices based on the results. They are operating half blind right now.

If they are willing to give away super preferred pricing to people who may only be basic preferred (because they can't tell the difference yet), why shouldn't you benefit?

I expect to see a huge spike in applications from 08701  ;D
Honestly, it's actually a little surprising that they're not cheaper than everyone else. It's direct marketing only (no commissions), underwriting requires no staff, one product, etc - all of that likely means much lower expenses, which is the holy grail in term pricing.

As far as the actual underwriting, the only piece they're really missing is the added info of the medical exam (primarily the blood work). It's not so crazy to think that in the presence of all the other hard data they might be able to pull, the medical exam doesn't often meaningfully affect the outcome. Layer on that any conservatism they likely built into their mortality assumptions for lack of prior experience with the system and it doesn't seem like that big a risk.

Offline yitzf

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Re: New trend - Instant approval life insurance
« Reply #33 on: March 21, 2017, 01:26:58 PM »
Honestly, it's actually a little surprising that they're not cheaper than everyone else. It's direct marketing only (no commissions), underwriting requires no staff, one product, etc - all of that likely means much lower expenses, which is the holy grail in term pricing.

I got mime thru an agent...(Principal)

Online skyguy918

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Re: New trend - Instant approval life insurance
« Reply #34 on: March 21, 2017, 01:29:34 PM »
I got mime thru an agent...(Principal)
I'm focusing on the pure online buying experience, like Haven.

Offline Baruch

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Re: New trend - Instant approval life insurance
« Reply #35 on: March 21, 2017, 01:40:35 PM »
If someone is very healthy is this a great deal?
Or is it a great deal only if someone has bad health?

Offline David Smith

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Re: New trend - Instant approval life insurance
« Reply #36 on: March 21, 2017, 01:42:39 PM »
If someone is very healthy is this a great deal?
Or is it a great deal only if someone has bad health?
The only thing you're really saving in that case is the hassle of the exam, and the rates don't seem cheaper than you'd get through a competent agent.
Who do you think you are fooling? You think you are going to pull a quick one on your Creator? Good luck with that.
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Offline Baruch

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Re: New trend - Instant approval life insurance
« Reply #37 on: March 21, 2017, 01:44:15 PM »
The only thing you're really saving in that case is the hassle of the exam, and the rates don't seem cheaper than you'd get through a competent agent.
So they're basically begging for people with poor health to signup?

Offline David Smith

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Re: New trend - Instant approval life insurance
« Reply #38 on: March 21, 2017, 01:46:06 PM »
So they're basically begging for people with poor health to signup?
They're begging people that are pushing off getting life insurance until they have time to sign up.
Who do you think you are fooling? You think you are going to pull a quick one on your Creator? Good luck with that.
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Offline Baruch

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Re: New trend - Instant approval life insurance
« Reply #39 on: March 21, 2017, 01:51:40 PM »
They're begging people that are pushing off getting life insurance until they have time to sign up.
those people too. But someone who knows that theres negatives in his blood work, will have to be crazy not to signup for this.

Basically, I don't understand how this model works.

If no one would demand a blood test, at least unhealthy people would be split evenly between all the companies.

But this plan should have an overwhelming amount of unhealthy people. No?

Offline hocker

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Re: New trend - Instant approval life insurance
« Reply #40 on: March 21, 2017, 02:03:38 PM »
The only thing you're really saving in that case is the hassle of the exam, and the rates don't seem cheaper than you'd get through a competent agent.
$27 sounds cheap to me. I'm paying double with metlife and i'm considered in excellent health etc.
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Online skyguy918

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Re: New trend - Instant approval life insurance
« Reply #41 on: March 21, 2017, 02:10:44 PM »
those people too. But someone who knows that theres negatives in his blood work, will have to be crazy not to signup for this.

Basically, I don't understand how this model works.

If no one would demand a blood test, at least unhealthy people would be split evenly between all the companies.

But this plan should have an overwhelming amount of unhealthy people. No?
That assumes that the automatic underwriting they do through a data driven algorithm doesn't come back with the same health rating as the full underwriting does - which is of course exactly what they've created their system to do.

Online skyguy918

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Re: New trend - Instant approval life insurance
« Reply #42 on: March 21, 2017, 02:11:25 PM »
$27 sounds cheap to me. I'm paying double with metlife and i'm considered in excellent health etc.
Where are you getting $27 from?

Offline hachover

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Re: New trend - Instant approval life insurance
« Reply #43 on: March 21, 2017, 02:20:41 PM »
those people too. But someone who knows that theres negatives in his blood work, will have to be crazy not to signup for this.

Basically, I don't understand how this model works.

If no one would demand a blood test, at least unhealthy people would be split evenly between all the companies.

But this plan should have an overwhelming amount of unhealthy people. No?

Very well reasoned. If your name is Bayes, there's a theorem named after you.

My conclusion is a bit softer than yours - there will be a higher portion of less healthy people than they'd like, and certainly higher than with full underwriting, though I don't think it will be overwhelming.

That assumes that the automatic underwriting they do through a data driven algorithm doesn't come back with the same health rating as the full underwriting does - which is of course exactly what they've created their system to do.

But it doesn't. Yet. Which is my point, though I'm trying to keep myself to saying it between the lines.
I'm an optimist; but only because life isn't going to give me any other good choices.

Offline hachover

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Re: New trend - Instant approval life insurance
« Reply #44 on: March 21, 2017, 02:26:43 PM »
If someone is very healthy is this a great deal?
Or is it a great deal only if someone has bad health?

If someone is very healthy, what's not to like? You can take care of life insurance in the same amount of time it takes to apply for a couple of credit cards, and with just as much difficulty. It's not cheaper than getting a policy with a medical exam (which is what I assume you mean by great deal) but why should you go through that if you don't have to.

If someone is unhealthy they probably won't get through the instant approval (unless they lie on the app and also have no searchable medical records). But if someone is normal - just not super preferred - they have a good chance of getting a better rating than they deserve.
I'm an optimist; but only because life isn't going to give me any other good choices.