Life Insurance Industry Trends
In the past few years, the life insurance industry has seen changes including mergers and acquisitions, implementation of an automated underwriting process, and investment in technology startups. It has also begun marketing to historically underserved populations and proven commitment to diversity and inclusion in the corporate workplace.
Mergers & Acquisitions
- In order to continue growing, life insurance companies utilize mergers and acquisitions to expand their markets, offer more advanced products, and react to changes in regulations.
- In 2019, New York Life Insurance bought Cigna's life and disability unit for $6.3 Billion.
- Hartford Financial Services Group Inc. acquired an Aetna Inc. life and disability operation in 2017 for $1.45 billion.
Automated Underwriting Processes
- Automating the underwriting process allows a life insurance company to acquire new business in a quick and seamless fashion.
- In January 2017, Lapetus, a US based life insurance company, started offering an option that allowed customers to buy life insurance by taking a selfie. Lapetus incorporated facial analysis technology to assign risk scores, which made the process quick and removed the time and cost of a medical examination.
- In 2019, Gen Re partnered with Lapetus's app technology to incorporate selfies into their policy acquisitions process.
- In 2017, Cuna Mutual implemented a new life insurance product called TruStage that allows customers to complete their application process by answering only two health questions. The fully automated underwriting platform generates a decision instantly.
- In the first 2 years of its release, TruStage had acquired $1 billion in coverage via its completely digital instant decision platform.
- In 2017, Northwestern Mutual implemented an intuitive application process for their life insurance policies. This automated underwriting process includes a medical history questionnaire the eliminates the need for medical examinations for approved customers. The process has reduced the underwriting time from an average of 28 days to one day.
Investment in InsurTech and Technology Startups
- Investment in new technologies, particularly InsurTech startups, is trending among life insurance companies.
- New York Life is investing in technology startups that offers data and analytics and advanced technology platforms, calling it a LifeTech ecosystem.
- Allianz Life Insurance's Venture sector has invested in SixThirty, a venture fund with a portfolio of FinTech and InsurTech companies.
Marketing to Historically Underserved Markets
- In a 2017 report, Reinsurance Group of America outlined how important underserved markets are becoming for insurance companies. Industry competition for low-risk consumers is high with pressure to reduce price. In order to continue to grow, insurance companies need to reach underserved customers.
- One example of marketing to an underserved market is John Hancock's Aspire program which targets US customers with diabetes.
- Aspire uses advanced technology to assist diabetics who acquire life insurance through John Hancock, to have longer and healthier lives.
Commitment to Workplace Equality and Diversity
- Life insurance companies are more steadily focusing on efforts to prove their commitment to diversity and inclusion in the workplace.
- In the 2020 Corporate Equality Index, a survey conducted by the Human Rights Campaign Foundation, Northwestern Mutual Life Insurance received a perfect 100 rating for the 6th year in a row, noting their commitment to LGBTQ inclusion in the workplace.
- MetLife has joined a project from Catalyst, an organization committed to helping women progress in the workplace, to show their dedication to represent women, including women of color, in leadership positions including the Board of Directors and senior level positions at their company.
- In 2019, MetLife won their 8th award for the company's dedication to Hispanic inclusion in the workplace.
- Transamerica was included in the Diversity Best Practices Inclusion Index, a list of companies that proves dedication to inclusion of women, minorities, people with disabilities, and people who identify as LGBTQ in the workplace.
Based on a few lists of the most popular and largest life insurance companies in the United States, the top companies were determined. From there, Wonder analysts performed in-depth searches of news from the past 1-5 years to discover recent changes across the industry. The results are outlined above.