What is the impact of COVID-19 on life insurance?

I was recently on a call with the CEOs of two large, brand name carriers and here are some very important takeaways –

  • One carrier reported mortality at only 91% of expected.
  • The carriers are very well capitalized – much better than 2008-09.
  • The number of new life insurance applications is up significantly – a response to insecurity and fear and the desire to protect loved ones.
  • Tailwinds are greater than headwinds for the industry.
  • One carrier reported the average age of COVID death claims was 44 – surprisingly low.
  • Most deaths from COVID are unfortunately uninsured lives.
  • Carrier technology investments are paying off. There is an irreversible move to digital processing – no going back to the old way of doing business. One of the carriers reported that 75% of new business cases are being processed electronically end to end. A huge change for what was a stodgy industry.
  • Carriers making life insurance more fun and easier to get – premium reductions for good health steps and better access for diabetics (half of Americans are diabetic or pre-diabetic). The idea is to encourage people to live healthier.
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