Manulife has updated its underwriting AI’s client questionnaire, nearly doubling its instant approval rate to 58% of all applications it processed, the insurance giant announced Thursday.
The Manulife Automated Underwriting Decision Engine launched last autumn, under the name Maude. The AI is based off a system introduced in 2018 called Artificial Intelligence Decision Algorithm.
It guides prospects through a questionnaire and enables automatic approvals for qualifying applicants in as little as two minutes, freeing up underwriters’ time to review more complex cases.
“The easy pile, as we call it, is gone,” Karen Cutler, chief underwriter for individual insurance at Manulife, said in an interview. “[New underwriters] are instantly coming into more interesting work, and what underwriters thrive on is really interesting work.”
The questionnaire is in an open-ended question format designed to mimic a conversation with a doctor. Questions will be tailored to the applicant’s age, coverage amount and responses, saving up to 40% of medical questions by removing irrelevant ones.
Agents on the system can use predefined options for common topics like hobbies and travel and standardized lists for medications and existing conditions, making it easier for the predictive AI model to process the information, Cutler said.
If the AI can’t approve the application automatically, it will be forwarded to a human underwriter. This includes applicants with existing medical conditions like diabetes and coverage that exceeds a person’s needs or affordability, Cutler said. The AI will approve standard cases while humans work on cases that the AI can’t be trained on yet.
For now, Maude will underwrite mass-market policies, such as younger lives for term coverage and smaller face amounts for universal life and participating whole life policies, Cutler said. It is also available on its mortgage creditor insurance affinity sales marketplace.
Maude was trained like a human underwriter, Cutler added. It started out with almost no approval authority, with more authority given over time as it learned the ropes.
“Our next natural place to go is with our critical illness insurance. … These underwriting decision tools that are AI-enabled can be applied on most products within some framework,” Cutler said. “For life insurance and critical illness insurance, we absolutely have that amount of data [to build reliable models].”
Manulife claims to be the first Canadian insurer to use AI for underwriting, but it’s not the only insurer doing so.
RBC Insurance has used an AI-supported underwriting tool for term life policies up to $3 million for applicants under 55 since last year. It plans to expand the tool’s capabilities to all insurance products.
BMO Insurance started using Microsoft Azure OpenAI in the field underwriting process for its life policies in November 2024. The AI system, called Rovr, helps agents pull information related to underwriting requirements quickly, and answer questions like how a client’s smoking and drinking habits will impact their application and what medical questions an agent should follow up with.