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How Insurers Can Help Prevent Unexpected Deaths

By Marci Sheeran

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What You Need to Know

  • Unexpected deaths have been elevated since the pandemic and are still rising.
  • These deaths will result in a cascade of costs for insurers.
  • Insurers should push for the development and use of preventive screening.

Insurance is about managing risk. Risk to our businesses, homes, valued possessions, health — and perhaps the greatest of all, risk to our lives. Our industry manages these risks in part by analyzing data — and the data from the years since COVID-19 emerged is very concerning.

When I was in high school, I went on a class trip to Washington, D.C., that included a visit to the Vietnam War Memorial. The memorial was still relatively new and controversial.

Being a teenager, the war seemed like ancient history, but it made an impression that I can recall to this day. It marked a pivotal point that not only honored sacrifice but opened the channels for an honest conversation regarding veterans’ health.

We can’t wait for a memorial to be built before we address the problem that is staring us in the face.

The Insurance Collaboration to Save Lives is a nonprofit that has analyzed the existing life insurance claims data since the beginning of the pandemic. Excess mortality in all age groups was up in 2020, the first year of the pandemic, as expected.

What is particularly alarming, however, is how the excess mortality continued to increase, shifting to younger ages, in some cases as high as 200%. While not as high as it was in the latter half of 2021, it still is elevated and has not fallen back to pre-pandemic levels. This is supported by data from third-party industries such as funeral services, who have reported elevated demand and record revenues. 

My reference to the Vietnam War was not a casual one; from February 2021 to March 2022, the number of excess deaths in the millennial age cohort was over 60,000. These excess deaths in six months exceed the number of American soldiers lost in 10-plus years of the Vietnam War. 

How did we just miss 61,000 people who were in the prime of their lives? They were husbands, wives, mothers, fathers, brothers, sisters, children, friends, colleagues. In Vietnam, we basically ignored nearly 58,000 deaths over a decade and it is considered a national shame. Do we really want to wait 10 years this time? 

Unexpected Deaths

The pandemic alone doesn’t explain all of those deaths, nor the rising rate of disability and health issues. At this point though, how we got here doesn’t matter; the question that matters most now is what are we going to do about it?

The most recent data analysis suggests that unexpected deaths will rise another 10% to 20% in the aftermath of COVID-19. The industry’s inability to confront that cold fact places it in a precarious position.

The challenges that long-term care insurance has been tackling in recent years will appear to be child’s play compared to the financial repercussions resulting from large unexpected claims/losses. The cost of honoring the contract to those extra 10% to 20% that die unexpectedly will cascade and eventually be reflected in new business, future sales, company ratings, stability and profitability. The tide has pulled out and there is a big wave coming.

But does this mean there is nothing that can be done? The good news is no. 

What Insurers Can Do

The insurance industry is in a unique position to get in front of this looming problem on the horizon. The Insurance Collaboration to Save Lives was formed to help tackle this problem. We are volunteer professionals from all corners of the industry and the globe — senior executives, board members, actuaries, underwriters, agents, attorneys, medical directors, regulators and more. 

We each bring unique perspectives, but our collective experience is united in a mission: We believe we have a responsibility as industry professionals to seek answers in order to save lives and mitigate loss. 

As we see it, the industry is looking at responsibility for claims for which it is not adequately prepared to handle. ICSL encourages our industry partners to join our effort to develop the tools to proactively screen for the 10% to 20% of the insured population that may have a serious health risk for which they are unaware. This gives the insured the information to take the appropriate steps to address any silent underlying health issues before they become a serious problem and it potentially removes an unexpected loss.

Not only does this make financial sense, it shows the public they are more than just numbers on a balance sheet — they are human beings who deserve any assistance we can provide. Yes, there are hurdles to overcome, but this is a time to be bold and brave. 

The men and women that I have worked with over my career are some of the most caring people I have met in my life. They help people during the lowest points in their lives — the house has burned down, a car accident, or the ultimate loss, one’s life. Let’s embrace the spirt of helping humanity and take that to the next level.

Marci Sheeran, CLTC, LUTCF, is a volunteer member of the Steering Committee of the Insurance Collaboration to Save Lives.

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