Keeping the wheels turning: underwriting in a pandemic


Helen Croft  Helen Croft,  Underwriting and Claims Strategy Manager

Friday 18 September 2020


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The last six months have impacted us all – no one has escaped the unrelenting shift in our lives that Covid-19 has created.

With all the uncertainty, there has been a collective spotlight shone onto our industry. In a time where mortality and financial uncertainty has been a constant, the very real need to have protection in place has never been greater.

So how do you continue to develop underwriting rules during a pandemic? Not answering this question is never an option. Transparency is key regardless of the situation. So we’re discussing the world of underwriting during a pandemic and what we’re doing to keep the wheels of insurance turning.

Into the unknown

Underwriting is a fascinating field to work in. By the nature of the job, things are always changing, whether that’s rules, technology, products or medical advancements. Our work and development to our strategy is usually based on long term research and analysis. 

The Covid-19 pandemic has represented a whole new challenge as this long term view is not yet available. Life as we knew it was changing rapidly and we had to adapt. Quickly.

Underwriters shoulder a big responsibility, not just to new customers, but to make sure that we make sensible decisions that support our existing customers, distributors, partners and our staff.

The risks

The nature of Covid-19 means that most people have a mild illness. However, as we have seen, a significant number of people have a more serious reaction, resulting in hospital admission and in some cases, death.

One of our first challenges was understanding the likelihood of someone having a mild or severe reaction to the virus.

Whilst the mechanisms of this are still not fully understood, we now know the groups most at risk are the elderly and those with pre-existing health conditions. Underwriting changes have focussed in these areas with most insurers reducing the maximum ratings that they can apply throughout the pandemic as a result.

Most insurers also now ask an application question about Covid-19 symptoms and diagnosis with people with current or recent symptoms being postponed, as would be the case with other conditions with recent diagnosis and a varied prognosis.

Always learning

An important thing to remember is that an underwriter is not assessing an individual in a snapshot as they are now, the underwriter is looking to understand the risk that someone represents over the term of the policy, so that an appropriate price can be charged. There are still many unknowns with the Covid-19 pandemic with differing opinions on whether there will be a second wave and what this would look like. We’re learning every day and adapting as more information becomes available.

Beyond the virus

The loss of life due to Covid-19 is a tragedy, yet it’s only one piece of the puzzle when looking at the impact of the pandemic on health and wellbeing. We know that the excess mortality in the UK is one of the highest in the Europe with a 7.5% increase in death rate compared to previous years* and this is not just people who have died of the virus itself.

The impact of the suspension of health services will be far reaching. For example, delays to treatments and surgeries will mean that some medical conditions will be lived with longer and may get worse. Delays to routine screenings will lead to missed diagnosis of early stage cancers meaning that they’re treated at a more advanced stage, decreasing the likelihood of recovery.

In April 2020, urgent cancer referrals were reduced by more than half**. Many people have been unable to attend their GP surgery for their routine checks related to long term management of medical conditions, meaning poor control or complications could go unknown for longer.

It’s these longer term risks that pose the biggest challenge in underwriting and these factors are most likely to impact people with significant pre-existing medical conditions.


Most insurers have both a Covid-19 application question and maximum ratings in place. This has resulted in a higher level of people being postponed cover than before the pandemic. No underwriter relishes not being able to offer cover to someone who needs it and we’ve already seen steps at AIG and across the market to refine underwriting practice and make cover available to more people.  

In the intermediary channel we’re now seeing less than 3% increase in people not being offered cover. ***

Medical evidence

Throughout this time, availability and accessibility of medical evidence has changed and underwriters have needed to adapt.

Due to social distancing guidelines, in person medical screenings were unable to take place. In collaboration with screenings providers, AIG introduced virtual screenings to allow more applications to proceed throughout lockdown - this remains an option in the event of local lockdowns.

GP evidence was difficult to obtain whilst surgeries were strained but service has broadly returned to normal for now. This may change again if a second wave puts further strain on the GP practices.

What next

We’ve already seen philosophies adapt and change over time and expect this to continue but with a level of restriction in place until the long term risks are better understood. Focus lies with the progression of the numbers of people with Covid-19 and the impact of non-provision of health care services. 

Developments in underwriting never stop, regardless of a pandemic. As more information becomes available, the landscape changes and we’ll keep the wheels turning to make sure as many people as possible have access to the protection they need.



***AIG internal MI July 2020