ARTICLES
The Spark of Human Connection:
Benefits of an Interview by an Underwriter for Depression and Anxiety Cases
By Lincoln Tedeschi, President, IBU, Inc.
Determining the mortality risk for cases involving depression and anxiety has evolved significantly over the past few decades. With the availability of new medications for mental health disorders, a growing social acceptance, and an increased prevalence of diagnosed cases, underwriters are faced with more and more cases involving conditions that in the past were considered substandard risks.
Today, underwriting “triggers” such as being on a prescribed medication no longer provide definitive guidance. For example, an applicant who discloses that they take Paxil may or may not represent a significant mortality risk. Often, Attending Physician Statements (APS’s) that simply confirm the medication do not provide any additional insight about the individual’s history. This presents a real challenge for underwriters to determine proper risk classification.
For a variety of reasons APS’s from mental health professionals often don’t provide information that aids underwriting departments in separating the good risks from the bad. The underwriting value of these APS’s, therefore, is not the same as APS’s requested for other types impairments not related to mental health. Very often, the information in the mental health APS is not sufficient because much of what patients talk about with their psychiatrist is discussion therapy and not documented in the medical record. As a result, what is often reflected on the chart is that the patient is doing well and taking medication. But “doing well” doesn’t provide underwriters with the information needed to properly classify the risk.
For their part, applicants typically don't volunteer much information about their mental health condition on the initial application either. Agents generally don’t want to probe too deeply, or they may know the applicant. In these instances, the applicant is unlikely to divulge sensitive information about him or herself.
Telephone interviews by experienced underwriters are proving to be a valuable solution to this challenge. When an underwriter conducts an interview with an applicant, the focus is on obtaining the specific details necessary to take final action. In cases involving depression and anxiety that means asking the right questions to determine the root cause and extent of the problem.
Experienced underwriters’ knowledge about health-related matters and conversational tone creates a sense of trust with applicants, which encourages them to open up. While conventional wisdom is that people won’t talk to strangers on the telephone about very private matters such as their state of mental health, insurers are finding that interviews by underwriters for cases involving depression and anxiety offer significantly better information than the APS’s obtained from mental health professionals.
A Friendly Voice on the Phone
There seems to be a spark of human connection that occurs when applicants speak with an intelligent, personable underwriter. The conversational tone gets applicants talking, and keeps them talking.
The secret to conducting an effective interview with a life insurance applicant is to ask the questions in such as way that applicants don’t feel threatened or that they’re being judged in any way. Rather than reading from a rigid script of drill down questions, experienced underwriters are able to rephrase questions to encourage truthful answers.
For example, if a case is flagged for special attention due to a medication that is recognized as being prescribed for depression, when the underwriter asks, “Do you have any history of mental disorder?”, the applicant may likely say no because they don’t view their condition as being a “mental disorder.” Later in the interview when the applicant confirms their prescribed medication, an experienced underwriter will know to rephrase questions in a more sensitive way. Instead of saying, “Do you have depression?”, which can be viewed harsh or judgmental, the underwriter will ask, “Are you taking that for some stress?” or “Can you tell me about when you began taking that medication.”
At this point, applicants generally begin to open up and disclose the root cause of the problem such as, “I am going through a divorce” or “My work was very stressful.” Pretty soon, the underwriter is able to discern the full picture of the applicant’s story, and that’s the real difference between an APS and an interview by an underwriter. An interview tells the story whereas the APS only reflects the clinical details.
The gut instinct of experienced underwriters lets them to pick up on nuances in the conversation and probe more deeply to determine if whether or not there is reason for concern. With depression and anxiety cases, an interview reveals a story; a story that is rarely found in an APS. The benefit for insurers and applicants is that more cases are able to be underwritten favorably, and in less time, than otherwise would be allowed based solely on an APS. For example, it is now common for anti-depression medications to be prescribed for menopause, which in itself does not present a significant mortality risk. Another example is depression medications that are prescribed to treat ADHD.
In conducting interviews with applicants throughout the US and the United Kingdom, IBU’s experienced underwriters have found applicants to generally be honest and forthcoming. In fact, applicants in the UK are even more open as there is less social stigma associated with depression and anxiety as medical conditions.
Getting Good Risks on the Books Faster
Insurance companies in the US and UK are “carving out” depression / anxiety APS’S and GPR’s and instead using an interview by an underwriter.
Besides gathering better information than an APS, interviews by underwriters save significant time and money. In the US, an APS typically costs around $50. In the UK, the cost for a GPR is £65. In contrast, the cost for an interview by an underwriter is around $26 US and £18 UK. This represents savings of about $24 per application in raw costs for most insurers in the US and £47 in the UK. In terms of cycle time, an interview by an underwriter is generally completed in three days as opposed to three weeks or more for an APS or GP report. Good risks get on the books faster long before the inevitable buyers remorse sets in.
Any underwriting department, whether they are using teleunderwriting or not, can benefit from "carving out" depression and anxiety cases and using an interview by an underwriter. Companies using this approach are already reaping the rewards of lower underwriting costs and faster cycle time, while concentrating APS’s and GPR’s to the risks where they are truly warranted.
About the Author
Lincoln Tedeschi is founder and president of Interviews by Underwriters (IBU) Inc. An innovative concept in life and health underwriting, IBU has established the model for using experienced, professional underwriters to conduct phone interviews with insurance applicants. Lincoln is a well-known and respected leader in the utilization of life/health insurance underwriting talent. He holds a BA in Economics at the University of Connecticut.
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