Unum Automated Underwriting

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UK-based Unum adds new IFAs, raises revenue, binds business in seconds, and integrates to its back office

“The Allfinanz suite was well proven in our fields,” says Potterton. “It had been vetted in. Even our competitors said so. Partner companies had experience with it. One told us it was really, really advanced. We investigated, saw the demos, and agreed.”

Business situation

Unum Limited is a leading insurer in its fields in the United Kingdom, which include varied plans for group and individual coverage of income protection, as well as group life. Unum won the Income Protection Provider award for an unprecedented thirteenth consecutive year at the Health Insurance Awards 2010, and has been awarded Group Risk Provider of the Year for 2009 and 2010 UK Pensions Awards.

Unum already had robust backoffice systems, such as a medical underwriting, and solid policy preparation systems. Yet the competitive market was making highly visible public-facing changes through electronic front-ends and sales sites where advisers could augment income by binding fully evaluated applicants in hours, not the weeks sometimes seen with paper applications, medical evidence gathering and under-writing. Unum sells only through independent financial advisers (IFAs). The profession liked Unum’s policies, terms and service, but needed a quicker, easier entry point to convert new customers. Because Unum’s sales and initial reviews were then done entirely by paper and post, company management saw competitors were winning converts in advisers, and thus in policyholders.

“Our frustration,” says Andrew Potterton, Chief Medical Underwriter at Unum, “was that IFAs had no button to push to apply to Unum electronically. They could only print out a filled-in paper form and snail-mail it for manual processing. Today’s customers move too fast for that.”

Solution

Unum needed a multi-purpose electronic front-end to sharpen IFAs’ interest. The company investigated many vendors to find a smooth and proven interface, submission and quote engine. “We didn’t want to be anyone’s experimental customer,” says Potterton. “Several well-respected reinsurers had intelligent front-end systems, but they didn’t meet our needs. One software developer we talked to didn’t have a well-enough evolved product. Another wasn’t suitable for our industry. Other vendors wanted to learn our business and then develop their product on our time.” “The Allfinanz suite was well proven in our fields,” says Potterton. “It had been vetted in. Even our competitors said so. Partner companies had experience with it. One told us it was really, really advanced. We investigated, saw the demos, and agreed.”

Unum acquired and began implementing, customizing, and integrating the Allfinanz product suite, a framework and rules engine for customer applications, questions and submissions.

Unum set the scope, speed of implementation

“Because Unum is massive and these policies are complex,” says Potterton, “we had to ensure installing and integrating the Allfinanz suite wouldn’t ‘break’ something else. The Allfinanz standard rules engine is quite good and quite flexible, but we underwrite differently from our competitors.“

“We could have used the Allfinanz engine as is, but chose to tailor it to our unique rules and practices. Because of our unique underwriting approach, integrating our IP coverage took some work. How could we handle fluctuating incomes and other realities? Ensuring the Allfinanz suite is seamlessly integrated into our trusted backoffice and security systems was paramount.”

“We plan to expand online application to all lines, but now use it only for individual policies, and just to be sure, we phased in that usage gradually.”

Opening new marketing doors

Unum launched the Allfinanz solution in Oct 2009. “It’s the universal access point we needed,” says Potterton. With the Allfinanz suite proving its worth, in March 2010, Unum expanded IFAs’ access to include four portals: The Exchange, Webline, AssureWeb, and Truepotential. Advisers get access to those quotation engines, enter personal and product  details, and get quotes. Then they slide into the Allfinanz solution for additional pre-population and detail in the quotes.

Brokers can still use paper if they prefer, or employ a telephone interview with a Unum underwriter or insurance nurse specialist. Where a submission requires underwriter input, the underwriter can view the case and add comments, which then become part of the record.

Business benefits

“Since launch, we have been able to do business with many new brokers that had never used us before,” says Potterton. “We get business through much faster. With straight through processing, a customer may know what we think of the risk within seconds of submission, and go on risk immediately. This gives us a definite jump in immediate closures. We are focusing on market share and it’s improving.

“Pretty rapidly, we achieved 50 percent of Allfinanz applications becoming straight through processing. Signs point to that surpassing 90 percent. We’re enjoying the experience.”

Advisers appreciate allfinanz

“IFAs like our to-the-point questions and instant decisions for most cases,” says Potterton. “The engine can also handle some quite complex issues. We have good feedback that IFAs  and customers really like its practicality and ease of use. Advisers use the Allfinanz solution as a pre-sales tool to ease into interviews. They understand what we ask for, and  why. It even looks inviting to the eye.”

Understanding underwriters

“We have an excellent underwriting department,” says Potterton. “They average twelve to fourteen years tenure. My motivation is to facilitate their work. The Allfinanz solution helps us become more consistent at underwriting, and it will take more routine jobs off their desks and focus underwriters’ time on more interesting challenges.”

Expanding System Use

Potterton anticipates the new system will soon expand its usefulness within Unum. “We bought it because it has applications in other parts of our business, and can repeat this performance to get us new markets. Our group business is one example.

“From an executive perspective, we now have dependable information, which we gathered rapidly, and which is in electronic form. It can be more easily organised, analysed, mined and distributed. So we expect to see its role grow as it proves its usefulness.”


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