The Data is in on Mortality Slippage
As life insurance distribution goes increasingly digital, accelerated underwriting (AUW) has quickly become the standard. AUW is designed to reduce underwriting time and costs while boosting sales by offering a streamlined, consumer-friendly process benefiting customers and carriers. It has largely accomplished this, however, its rapid adoption has also surfaced a critical challenge: increasing mortality slippage.
Mortality slippage—when carriers unintentionally allow high-risk applicants to bypass rigorous vetting and place them in a better risk class than had they gone through full underwriting—seriously threatens profitability and long-term sustainability.
Historically, the challenge for carriers is simply the lack of data on AUW programs. The first AUW program launched in 2012, with most coming online within the last decade, compared with traditional underwriting which has been around for far longer.
The good news is, the early data is now in. The bad news is the mortality slippage issue is worse than initially predicted. Several leading reinsurers have published their analysis, which we will synthesize in this article. We will also discuss a new ForMotiv Solution available to help carriers identify nondisclosure and reduce mortality slippage during the AUW process.
Shifting Goals of Accelerated Underwriting – Managing Mortality Slippage
According to a 2024 Gen Re survey, 82% of life insurers have implemented AUW, with another 10% planning to adopt it within two years.
The survey started in 2021 and asks 38 carriers to rank their top three goals with their AUW programs. Here’s how the responses have trended over time:
Carrier Goals | 2021 | 2024 |
Reducing Time to Issue | 63% | 53% (-10%) |
Reducing Costs | 38% | 22% (-14%) |
Manage Mortality Slippage | 28% | 44% (+16%) |
Needless to say, mortality slippage is quickly becoming top of mind for carriers responsible for their AUW programs.
New Data Published by Leading Reinsurers
Given how new the AUW programs are, there has been a lack of credible mortality data to appropriately monitor the associated risks. While that data continues to mature, carriers take different approaches to monitor their AUW programs to inform future decision-making. The two most common monitoring techniques are Random Holdouts and Post-issue Audits.
- A Random Holdout (RHO) works like airport security randomly flagging people to step out of line to the metal detector and undergo a more strict vetting process. During AUW, the folks randomly selected typically receive a fully underwritten process before a decision is made.
- Another random approach is a Post-Issue Audit (PIA) where an audit is conducted after an AUW decision has been made. This usually involves reviewing an attending physician statement (APS) or electronic health record (EHR).
Carriers also employ targeted approaches that focus on higher-risk policies i.e. those flagged by MIB or Rx Recheck or policies associated with a problematic sales agent. However, because targeted audits are skewed towards cases more likely to be misclassified, they are not as useful for mortality monitoring.1
SwissRe published a very in-depth comparison between these two approaches, as did Munich Re, so if you’d like to dig in even further please check out their full studies.
We’ll provide some of the highlights on the mortality slippage results below.
Munich Re Study Results
Background: The study includes 11 years’ worth of RHO and PIA data on over 33,000 lives across 30 AUW programs. They define mortality slippage as “the implied mortality load relative to FUW mortality due to risk class misclassification in the AUW process. It is calculated on a present value of future claims basis using Munich Re’s internal view on a program’s mortality for a given age/gender/risk class.”
They estimate that overall mortality slippage is 12% from RHO cases vs. 15% from PIA cases. The difference could be attributed to several factors, including additional medical history seen in an APS/EHR vs. fluid testing alone, sentinel effect where applicants may answer more truthfully if they know they may receive a fluid test and hit rates on APS/EHR that may skew the data towards people who visit the doctor more.
Another finding is that they have observed aggregate mortality slippage trending up over the past 11 years. Carriers are continuing to battle increased misrepresentation “misrep” that could be a result of awareness around reduced requirements in the fluidless, AUW path.
Zooming in on Misclassification Results

And the reasons for misclassification for a subset of the misclassified cases in the study are as follow.

For further discussion on the top misclassification reasons, check out Munich Re’s full article here.
Zooming in on Tobacco Misrepresentation
According to the study, overall tobacco misrep has been trending up and is currently 40%. Smokers, whose mortality rates are 2-3 times higher than non-smokers, frequently lie about their status to secure cheaper premiums. This tracks with other studies we’ve discussed in the past that said tobacco nondisclosure rates have doubled in the last seven years.
RHO are more successful at uncovering tobacco nondisclosure than PIA as labs normally test for cotinine while it’s common that APS/EHR data wouldn’t have information on a patient’s smoking status.
“Unfortunately, we have seen misrepresentations increasing over time. Especially in areas like smoking status, build, and medical and family history,” notes Tim Morant, chief risk assessment officer for Munich Re Life U.S.

The Cost of Mortality Slippage
The financial implications of mortality slippage are significant. In another study, Swiss Re analyzed 37,000 policies and found that mortality slippage averages 15%, with some programs experiencing rates as high as 30%. These figures are stark when compared to the baseline of 0% for fully underwritten policies.
Swiss Re found that nearly 2 out of every 100 AUW policies should have been declined. These policies alone make up 40% of the overall slippage.
They also found that 2.1 of every 100 AUW policies should have gotten a tobacco offer but received non-tobacco through AUW. These policies make up 20% of overall slippage.
That said, discovering just one high-risk applicant could save hundreds of thousands of dollars in premature claims, especially for policies with large face values (e.g., $250,000–$1 million or more). For example. a single misclassified smoker who falsely claims to be a non-smoker could cost the carrier up to $100,000–$200,000 in excess claims over the life of the policy.
This shift not only disrupts mortality assumptions but also forces carriers to reevaluate their pricing and program designs.
A New Answer to Mortality Slippage
As Samantha Chow, global life and annuity sector leader at Capgemini, explains: “The key is having the right third-party data pulled when needed, the right rules in place, and the right depth of analytics to catch the lies and omissions.”
The fact is, mortality slippage continues to worsen. In response, carriers have increasingly adopted real-time behavioral analytics as an answer. ForMotiv’s Nondisclosure Solution stands out as a powerful tool to address mortality slippage by providing rule-based alerts on how applicants fill out their applications to identify instances of misrepresentation. How applicants engage with important underwriting questions such as tobacco, build, alcohol, medical history, etc., is highly indicative of the truthfulness of their response.
ForMotiv helps carriers better and more effectively triage applicants during the AUW process. ForMotiv looks for high-risk manipulative behaviors during the Part 2 process of the application. Using a simple example, if an applicant answers an alcohol usage question saying they drink alcohol daily, engages with the reflexive questions, then changes their response to they do not drink.
That applicant is a case you will want an underwriter to look more closely at given the material misrepresentation and/or declination risk is 3X the typical user. In this example, the only way you would “catch” that person is if they were randomly selected. With ForMotiv, that person can be immediately flagged and automatically driven toward the next best action for them, such as calling additional data checks/evidence, sending for further review, or pushing down a FUW path. It’s important to note that carriers are not using ForMotiv Rules to underwrite a policy, they are simply flagging it for a deeper UW review.
Key Features of ForMotiv’s Solution:
- Life Insurance Expertise: We’ve analyzed over 100m life insurance applications and developed a rules-based solution tuned to identify high-risk behaviors during the application process, without capturing PII.
- Focus on Material Misrep and Declinations: Our rules are tuned to focus on significant material misrepresentation and declinations and to not have any significant impact on your accelerated underwriting rate as we know that’s how many underwriting teams are measured. On average, we identify roughly 4 policies out of every 1000 that result in material miresp, half of which result in declines.
- Enhanced Evidence Pathways & Triaging Capabilities During AUW: Our solution is actionable, meaning we can integrate seamlessly into your accelerated underwriting flow to triage applications real-time.
- Confidence to Expand Offerings: With improved nondisclosure detection capabilities, insurers can confidently increase face amounts and expand AUW eligibility criteria without compromising mortality assumptions.
- Applicable for FUW: Our Solution can also be leveraged during the FUW workflow to enhance PIA accuracy after issuance, better determine which labs to call for particular applicants, as well as inform forensic underwriting and SIU.
- Proprietary, Compliant Dataset: ForMotiv’s proprietary Behavioral Data analyzes how applicants and agents engage with digital forms without capturing PII. As regulators continue to scrutinize the use of AI and ML during underwriting, carriers can confidently leverage ForMotiv without stressing about compliance.
The net present value of identifying these policies is significant, so as leading carriers continue to scale their AUW programs, increase face amounts, and process tens of thousands of policies a year, or even a month, finding incremental cases of nondisclosure is critical to having a profitable book of business.
Reach out to learn more about our solution and the work we’re doing with leading life insurers.