On September 27, 2017, RGA’s U.S. Underwriting team received the 3 millionth facultative case from our clients – an unprecedented accomplishment that serves as both a milestone achievement for our company and an emblem of the core business philosophy that has made that achievement possible.
Our facultative expertise has become RGA’s calling card within the industry and served as a springboard for our growth globally.
How did we get here? By understanding the importance and potential of every single facultative submission sent to us. At RGA, we have learned firsthand how one case can lead to more business, launch a longstanding relationship between companies, and even transform an industry. Most importantly, we have also seen how one case can change lives.
From One, Many
Fittingly, RGA’s facultative business grew out of just one case. In 1977, insurer General American’s fledgling reinsurance division (which would eventually become RGA) received an inquiry from a client in need of a facultative review. Without even having a designated underwriter on staff, our small team at that time (I would join as a reinsurance underwriter trainee in 1983) accepted the challenge. And that’s how we’ve gone about our facultative business ever since – doing whatever it takes to support our clients.
Take our Year-End Support (YES) program. When RGA learned that case volumes at year-end were overwhelming clients, we extended our hours and had underwriters on call every weekend through December to help clients meet the added demand. ASAP (Automated Selection and Assessment Program) provides another example. Built on our e-underwriting platform, AURA, ASAP enables clients to submit cases online and receive instant, binding decisions on cases with impaired risks, eliminating the need for time-consuming paperwork. Last year, ASAP received its 100,000th case submission, with more than $30 billion in face amount placed.
We continually ask our clients, “What can we do to help you grow?” Then we take action. I remember when we first introduced an underwriting toolbox for clients. One of our competitors couldn’t believe how much we were making available – no reinsurer had ever been so accommodating or transparent before. It is this collaborative approach that built that initial facultative case into the industry’s leading underwriting practice.
A Relationship Business
Facultative underwriting at RGA centers on building personal relationships and creating a frictionless connection from reinsurer to insurer to agent. This requires getting to know their underwriting teams as people and professionals, and stepping into the trenches alongside them. Years ago, we established a philosophy that each of our underwriters should strive to make at least two phone calls a day to deliver underwriting decisions – not emails, faxes, or texts, but person-to-person calls. When we first started doing it, our clients assumed something was wrong. Why else would a reinsurer take the time to call? It’s just always been how we’ve fostered relationships, maintained open lines of communication, and provided education and insights that help our clients with their work.
Our facultative expertise was often the conduit through which lasting business relationships were formed. In 1984, a leading U.S. carrier lost out on a diabetes coverage opportunity as the customer selected another insurer. When the carrier investigated why they lost the business, they traced the cause to their competitor’s facultative underwriting on the case – which was actually performed by RGA. That leading carrier would soon reach out to RGA and form a partnership that remains intact to this day.
Since we grew out of a primary insurer ourselves, we have always had a special understanding of the challenges insurers face. We know, for example, that a carrier’s relationship with a key broker can sometimes hinge on just one case. So we give each submission the personalized attention it deserves. I often wonder, of the 3 million individual facultative cases we’ve seen, how many have made a vital, business-critical difference for our client partners? And even changed the life of a family?
Innovation Through Strength
Over the years, this unrelenting focus on our clients’ success has produced a string of underwriting innovations, such as FAC Console® (Facultative Application Console®), which enables insurers to submit facultative applications to multiple reinsurers simultaneously. Or TransUnion TrueRisk® Life, which provides a credit-based insurance score that is predictive of mortality and the likelihood the applicant will keep the policy in force
We take pains not to fall victim to what I call legacy thinking, which occurs when attitudes and ideas fail to evolve, and people remain stuck in the way things have always been done. RGA operates under the belief that all reasonable and responsible ideas should be given a fair chance. Markets develop and conditions change, and timing is everything. If an idea doesn’t work today, that doesn’t mean it might not work tomorrow.
Our ever-expanding facultative expertise and resulting experience data have fueled innovation cross-functionally, creating new insights, new products, and new risk management tools. In the digital age of InsurTech and instant-issue policies, RGA’s underwriting strength serves as the bedrock our clients trust and depend on.
It’s All About People
As technology advances and more automated solutions come to market, I believe there will always be a need for human underwriters. The more complex data gets, the more nuanced judgment will be required. And while metrics must remain black and white for machines, human expertise is much better equipped to untangle all the multivariate grays any case could bring. After all, these “cases” are people, and each individual is unique.
That’s really what it all comes down to: people. What we do as an industry is vital to the lives of the countless individuals and families we serve – to stay in their homes, to send their kids to college, to simply carry on after the loss of a loved one. When I think of each one of the people RGA has touched through our facultative services, I am reminded why I do what I do and how proud I am to be part of this noble industry and this remarkable company. Three million and counting…