Buying Life Insurance In Just Three Days

“Do you own life insurance?”

The client responded, “no.”

Now, this man was the primary earner for a large family, plus he was carrying the typical large amount of debt. My colleague, who was helping put together a financial plan for this client’s retirement, explained that in his situation, life insurance is a must. Without it, if the unexpected happened, his family would be left in a terrible position.

Before the retirement accounts got funded, before anything else in terms of planning went forward, this man had to get himself insured.

The problem was that acquiring life insurance normally takes at least four to six weeks—often, it’s more like four to six MONTHS! That’s a long time to put off dealing with other financial matters, especially with tax deadlines. Is there any way, the client wanted to know, that we can hurry it up a bit? Get insurance quickly?

And it turns out there is. It’s called accelerated underwriting.

This is real, and it’s the future of buying life insurance. Accelerated underwriting is now possible because of a new tool called predictive analytics. We will be writing a lot about predictive analytics here, but the short version is that advances in machine learning, along with modern data mining techniques, make it possible for carriers to decide what policies to offer you for what prices faster than ever before.

You fill out an application, complete a phone interview, and the carrier pulls any additional necessary information from publicly available databases—the Medical Information Bureau (MIB), the Pharmacy Database, and your Motor Vehicle History (MVR). As of today, there are limits on this process. To qualify for accelerated underwriting, you typically have to be in good health, and even so, not every product is available and $1,000,000 is about the most coverage you can get. In time, though, these limits will likely be lifted as predictive analytics gets more reliable and more available.

So, this client agrees he needs coverage and fills out the online application on a Monday. The phone interview is completed on Tuesday. The policy is approved and issued on Wednesday morning—and placed in force on Wednesday afternoon. That’s called buying life insurance in just three days.

The process isn’t always so fast. Possible hang-ups include the applicant not filling out the forms correctly or the underwriter deciding to ask for additional information. But coverage within three days is certainly possible, and even at its slowest, accelerated underwriting is faster than the alternative.

A fast completion time is important for carriers—frankly, it costs them less, so they make more money. But it’s also good for you, the consumer, because you get the protection you need faster and with less hassle.

Buying life insurance fast is something to get excited about.