(May 2008) Filling out insurance applications is a regular part of an advisor’s job, but getting the documents completed is frequently a struggle. What most don’t realize, however, is that blank forms make the process much longer than it needs to be.
Shelina Esmail, head of living benefits and chief underwriter at Canada Life, says advisors who forget to fill out portions of each application make the underwriter’s job more difficult and the wait for an approval or denial even longer.
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“We’ll get several things answered and then five questions are skipped,” she says. “Sometimes advisors get interrupted; sometimes they’re under pressure to complete the application as fast as they can.”
She says a recurring problem underwriters see is the habitual failure to fill out disability insurance (DI) applications correctly. On the DI document there’s a section that asks if the client has back pain. If the answer comes back ‘yes, ‘ then a special section on back pain needs to be answered. “Guess what?” she asks. “Ninety per cent of the time that question is answered ‘yes.’ How many times is the back pain questionnaire completed? Maybe 20%.”
Esmail says it helps if the advisor pays attention to every question on the application. It sounds like a small thing, but it can mean the difference between a flurry of underwriter e-mails and a smooth, effortless process. “I don’t want to make life difficult, but I have to make sure I can make the right decisions, so when a claim does occur, the file is completed.”
While filling out applications in full is probably the most obvious way to get a policy approved, communication between the advisor and underwriter is also key to a positive outcome.
Things like a client changing jobs or switching doctors is something the underwriter needs to know, and the advisor should offer up that information.
“One of the things we try to emphasize in underwriting is communication,” Esmail explains. “When you’re sending in an application, sell your client to the underwriter. I cannot read your mind.”
One the underwriter’s more frustrating tasks is chasing down APS (attending physician statements) forms. More often than not, advisors fail to ask clients the right questions, leaving the underwriter to dig more to uncover the important, unreported details.
One applicant, for example, simply reported having a thyroid problem. During the application process, Canada Life requested an APS. When the form was received, the underwriter saw the problem wasn’t a simple case of hyperthyroidism, and sent for another, more detailed report. The second APS said the issue was inconclusive. Three reports later, the physician’s statement revealed that the client had a malignancy.
To get to the heart of any issue, Esmail suggests advisors pay attention to curious answers their clients give, and ask the right questions. “When a client tells you that his doctor is referring him to another doctor, that’s clue number one that there may be something wrong,” says Esmail. “What is he referring you for? When is the appointment scheduled for? Ask those questions.”
Beyond the application process, part of the advisor’s job is to manage expectations. If advisors suspect something might not be covered, then it’s up to them to tell the client that there might be an exclusion or denial. If expectations are managed, there will be fewer disappointments in the end.
“Later, you can say, ‘do you remember that we discussed this in the past, that history of stress may be a problem?’ ” she says.
“Recognize where the risk assessment is for each product. When talking about life insurance, no one cares about sciatica or marital problems. When it comes to disability insurance, that sciatica is a big issue.” For critical illness, family history is significant, especially if relatives have had cancer or heart problems in the past.
By following these simple steps, it’s likely an application will be put through far more quickly than what some advisors are probably used to.
There is, however, one final thing advisors should never do when filling out applications: Never insult the underwriter.
“I’ve often been called incompetent,” Esmail deadpans. “It’s not in my best interest to have this conversation every day.”
Filed by Bryan Borzykowski, Advisor.ca, bryan.borzykowski@advisor.rogers.com
(05/14/08)