
The future of life insurance may depend on your online presence - kawera
https://www.theverge.com/2019/2/7/18211890/social-media-life-insurance-new-york-algorithms-big-data-discrimination-online-records
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wahern
> Algorithms speed up this process — though there aren’t many cases where a
> decision is entirely automated — and can make it more precise. Sometimes,
> the algorithm will greenlight a person so they don’t have to go through the
> invasive medical tests.

That sounds like a stupid idea except for very short-term, high-premium
policies. How many people immediately post to Facebook a cancer diagnosis?
Unless it's close to 100% then an insurer would be a fool to rely on it for
anything other than the most niche products.

> The convenience of immediately receiving a policy is appealing to those who
> don’t want to wait weeks for a doctor’s appointment, and that can lead to
> more life insurance policies being purchased.

When I was originally looking at term life insurance, the policy offered by my
employer required me to go to the doctor's office for a physical. I elected
the insurance but never bothered getting the physical so it never took effect.
A couple years later when I got serious about term life insurance and looked
into it more seriously, I discovered two things: 1) an individual policy is a
much better deal long term, and 2) many (most? all?) insurers for individual
policies send a phlebotomist to you--the one sent to me arrived with a needle
and scale and left so quickly I almost felt jilted.

> And while life insurance sales have traditionally been face-to-face
> interactions with agents, that mode is quickly falling out of favor, meaning
> that algorithmic processes are better for online sales.

That's another thing I learned: never buy any kind of insurance from a
salesperson. State Farm? Extremely overpriced because they spend a ton of
money on advertising and especially their enormous sales network. How many
local sales offices have you seen for Principal or Mutual of Omaha? Agents
selling their policies exist all over but the sales model for these insurers
is different which ultimately results in lower premiums.

And you don't need AI to disintermediate the sales networks. I got my policy
from policygenius.com. There are usually local sales agents who take a cut of
the premium. I think it's an artifact of the state regulatory structures.
Policy Genius and some local agent get a couple dollars every month from my
premium, even though the only thing local agent did was take my paperwork. But
that's still just a fraction of the overhead involved for insurers with more
aggressive marketing and sales models.

Finally, get term life and term disability insurance as young as you can. The
moment you feel you need it (e.g. new parent) do not hesitate. Disability
insurance is arguably more important than life simply because medicine is so
advanced these days you're unlikely to die from accidents or disease until
you're older, but you'll still likely be disabled. I'm still procrastinating
on the disability, though....

