Closing the underinsurance gap with next-gen underwriting tech

Bringing instant onboarding to Australia’s life sector

Today, service expectations run in real-time. A pair of trainers, groceries, even a new couch can arrive within hours of a click. Tax returns are processed in minutes and paid within days. Most insurance policies – including home, care and travel – can be confirmed online in seconds.

Why, then, should it take up to three months to secure something as important as life insurance – protection that can safeguard an individual’s and their family’s very livelihoods?

When it comes to life protection, many Australians remain substantively underinsured. Data from the Financial Services Council (FSC) shows that around one million Aussies lack sufficient death or TPD cover, while millions more go without adequate income protection.

With the adviser sector still reeling from a mass exodus, and a remaining cohort bearing the cost of a slow, still largely manual application process, fewer Australians are getting the life coverage they need at the time they need it.

Recent years have seen a sharp drop in the issue of new life insurance policies, from 103,000 in 2018 to just 44,000 in 2023 – a 57% decline – according to figures from Adviser Ratings. While not the only factor influencing this decline, excessive wait times are no doubt increasing applicant attrition.

A persistent sticking point in this customer onboarding process has been the Personal Medical Attendant Reports (PMARs), a report written by clinicians and assessed by underwriters to determine a prospective customer’s eligibility.

“Doctor’s reports, I think, are the biggest pain point in the industry,” says Acenda chief underwriter Amber Brockie, noting that a little less than half (42%) of its applicants require a PMAR.

Yet, while advisers and insurers wear the blame, turnaround times depend entirely on the capacity and prioritisation of already stretched clinicians.

“Some clinicians will be better than others at returning a PMAR,” Brockie says, “but it’s generally not their first priority.”

Acenda (formerly MLC Life) and partner EQ Pathology have sought to unclog this bottleneck, creating Australia’s first digital PMAR.

Unlike traditional paper or PDF-based forms, the fully digitised PMAR can be specifically tailored to the needs of the underwriter, “asking only what is required to get the exact information needed to make a decision,” Brockie says.

However, digitising the longstanding paper PMAR was just the first step. The ability to fast-track onboarding demands an ability to seamlessly ingest and process applicant data.

For Acenda, this meant a complete overhaul of its decisioning (or underwriting) engine, enabling, for the first time, straight-through, end-to-end digital processing of applications requiring medical evidence

“Making [onboarding] as easy and frictionless as possible, I think, is key to our strategy of having the best customer experience in the market.”

Acenda selected UnderwriteMe, a leading UK insurtech and underwriting specialist, to implement its API-ready decisioning engine, fully integrated with EQ Pathology’s digital PMARs.

Stephen Connolly, director of business development at UnderwriteMe, hailed the integration of the three partners’ software systems as “unprecedented success”, enabling seamless, straight-through processing that, in most cases, allows a “decision to be made as soon as [medical] test results are returned”.

“Our underwriting engine started with the idea that we should automate all simple cases, ensuring that [human] underwriting teams only look at things that really require their judgment and expertise,” Connolly explains.

“A lot of the mundane things, where we’re dealing with common structured data, we can push straight through,” he says.

Citing figures from a previous deployment, Connolly said its underwriting engine was able to slash customers’ policy confirmation wait times by more than a week, while improving policy take-up by 4.8%.

For Acenda, which is set to go live with the integrated solution in August, Brockie predicts that around half the applications it receives can be approved instantly by the enhanced underwriting engine.

The rest will go immediately through to Acenda’s human underwriting team.

“I want my underwriting team to be focused on the exceptions, those complex applications, not spending time on those simple tasks that can be handled by a machine.

“The more we can automate the simple tasks, the more we can have our specialist underwriters focusing on the tasks that require their skillset and knowledge, ultimately improving outcomes for all customers”

Information advantage – further refining the underwriting process

For Brockie, there is no love lost for the paper-based medical reports. From an insights perspective, she says, they are a “big black hole… that offer us zero insights”.

Yet, as underwriters, she stresses, “everything we do should be based on evidence and statistical data”.

A digital PMAR allows, for the first time, structured information to be seamlessly extracted and utilised by Acenda’s underwriters – both machine and human – to support evidence-based, impartial and real-time decisioning.

These powerful analytics can be leveraged to further refine the information-gathering and underwriting process, Brockie notes, helping to avoid unnecessary requests for invasive medical evidence.

“Access to this data will allow us, ultimately, to ask some of these questions of a customer upfront, potentially avoiding the need [of a medical report] in the first place,” she says.

Utilising secure, point-to-point API transfers, this fully digitalised process also significantly improves the security of these sensitive datasets.

“The transmission of data in an unstructured way – i.e. through paper or PDF – is, ironically, the least secure way of transferring data,” Connolly explains.

“Without automation, data will invariably go through a lot of hands before it gets to the person who actually needs to see it.”

Swifter, smarter and fairer decisioning

Acenda’s underwriting innovation represents a major leap forward in eliminating one of life insurance industry’s most persistent bottlenecks.

The seamless integration of digital PMARs into the underwriting process is the critical first step in enabling straight-through automation of application approvals. Yet, it also helps in more complex assessments, providing human underwriters with crucial insights to support faster and more consistent decisions.

Connolly has hailed the integrated solution as “transformative for the sector”.

“This integration is really going a lot further than what other insurers have done. Medical history reports can take months to satisfy, and so having a solution that can shave many weeks off this process is, I believe, transformative for all of us in the life sector.”

For an industry facing pressure to close Australia’s underinsurance gap, Acenda’s intelligent underwriting engine and digital PMARs have set a new benchmark for speed, accuracy and fair decisioning.

“At the end of the day,” Connolly concludes, “it’s going to be better for customers and better for advisers, resulting in more policies being offered faster, which is the whole point of everything we do.”

Closing the loop on Acenda’s bold transformation, it’s clear that next-gen underwriting technology is no longer a future aspiration but a present-day necessity. As digital PMARs and automated decision engines redefine what’s possible, the path to closing Australia’s underinsurance gap becomes clearer. Faster onboarding, smarter assessments, and fairer outcomes aren’t just technical milestones. They’re vital steps toward restoring trust, improving access, and delivering the protection Australians deserve, exactly when they need it.

Content Partnership sponsored by Acenda