OTR NEWS: TWENTY-THREE YEARS AGO, WILLIAM PHILLIPS REFLECTED ON THE ADVANCES MADE IN UNDERWRITING AND LOOKED AT HOW IT MAY LOOK IN THE FUTURE. ENJOY THIS REPRINT FROM THE 2001 ISSUE OF ON THE RISK .
2001: Space for Underwriters? William K. Phillips, AALU Vice-President, Life of Virginia
“I have looked into the future - and it’s expensive.” I recently saw the above item as a “daily chuckle” in the local newspaper. Based on my current observations, it may be the only safe predic- tion that anyone could make about the future. Considering the future of un- derwriting is an equally dif-
has declined over the past 25 years, the remaining professional underwriters see larger, more compli- cated cases, and face greater challenges in the mar- keting and communications areas than ever before. The underwriter of the future, to be a true profes- sional and survive, must be well educated, marketing- oriented and possess high communication skills. I have worked closely with the underwriting edu - cation program for the past 8 years. Increasingly, underwriters are beginning to realize the necessity of professional training. Perhaps this is a survival instinct. For instance, the program sponsored by the Academy of Life Underwriting should be a must for the professional underwriter. I also recognize the merits of the LOMA and CLU programs. Continuing education should be an objective. States are beginning to pass regulations requiring insurance agents to pur- sue continuing education. Changing developments in medicine and mortality patterns make continuing education a must for the professional home office underwriter. The attainment of the AALU designation or even the FALU designation is no longer an end but merely a beginning. As the number of FALUs grows, recognition of the FALU designation will also increase. One barometer to watch is the help-wanted ads. Increasingly, they are mentioning the Academy of Life Underwriting program. While computers have not replaced the underwriter, their application has certainly impacted underwrit- ing. Underwriters without keyboard skills will be severely limited in the future. Just as agency offices use the computer to interact with the home office computer, the underwriter of the future will also need to be proficient in inputting, reading and interpret - ing information. Obtaining medical data from local data banks, using electronic mail to correspond with agency offices, and corresponding with insurance service organizations are but some examples.
ficult task. Even if you have been in the underwriting profession for only a few years, you have seen many significant and startling changes. I have probably been a professional underwriter longer than most of you reading this article. I remember when inspec - tion reports were ordered on nearly all cases, when nonmedical limits were $10,000 to $20,000, when replacement was a universally nasty word, when soft drinks all came in bottles, when the Raiders were in Oakland, and nobody had heard of Universal Life. Is it hazardous to predict the future considering the current climate? I do have some strong opinions about the future of our profession and the insurance business in general. In accepting the challenge of writing an article about the future of underwriting, I have committed myself to sharing some of my own beliefs. First, I believe the underwriters will survive. Twenty- five years ago, when computers began to be popular topics, some companies switched to and began dis- cussing computer underwriting. Although this may still have some limited applications, the actual un- derwriting process has survived intact. No computer has yet been designed that can give the “smell test” to an application. Today we see an increased use of “jet underwriters.” Although the number of professional underwriters
ON THE RISK vol.40 n.3 (2024)
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