Is AI Making Your Life Insurance Decisions? Here's What You Need to Know
If you've applied for life insurance recently, there's a good chance that artificial intelligence helped decide whether you got approved and how much you pay. **89% of life insurance companies now use AI** to evaluate applications (LIMRA Technology Survey, 2024), and this technology is making decisions faster than ever before.
But here's what most people don't know: **You have the right to understand how these decisions are made**, and there are ways to make sure you're being treated fairly.
How AI Is Actually Being Used in Life Insurance
What AI Does During Your Application
When you apply for life insurance, AI systems are working behind the scenes to:
Instantly check your information:
Verify your identity and personal detailsCross-reference your medical history with prescription databasesCheck your driving record and credit scoreLook up public records and social media (yes, really)Predict your risk level:
Estimate how likely you are to file a claimCalculate your life expectancy based on health dataDetermine if you need a medical exam or can be approved instantlySet your premium rates based on hundreds of factorsSpeed up decisions:
What used to take weeks now happens in minutesSome healthy applicants get approved instantlyAutomated systems can flag applications that need human reviewThe Good News About AI in Life Insurance
Benefits for you:
Faster approvals: Get coverage in days instead of weeksMore accurate pricing: Pay rates that actually match your risk levelFewer medical exams: Healthy people often don't need blood tests or physicals24/7 processing: Apply anytime and get immediate feedbackConsistent decisions: Less chance of human bias affecting your applicationWhat You Should Be Concerned About
When AI Might Work Against You
Potential problems to watch for:
Data errors: If there's wrong information in your credit report or medical records, AI might use it against youBias in algorithms: AI systems can inadvertently discriminate against certain groupsLack of context: AI might not understand special circumstances in your situationNo human judgment: Complex cases might need human review that AI can't provideReal Examples of AI Problems
Credit score confusion:
AI sees a low credit score and assumes you're high-riskBut maybe you had medical bills that hurt your credit temporarilyA human might understand this context; AI might notMedical history misinterpretation:
AI sees you filled a prescription for anxiety medicationIt might flag you as high-risk for mental health issuesBut maybe it was just temporary stress from a job changeGeographic bias:
AI might charge higher rates based on your zip codeThis could unfairly penalize people in certain neighborhoodsEven if individual risk factors don't justify higher ratesHow to Protect Yourself When AI Makes Decisions About Your Life Insurance
Questions You Should Ask Every Life Insurance Company
When you apply for life insurance, here are the key questions to ask:
About their AI systems:
"Do you use AI to evaluate applications?""Can you explain why my application was denied/approved?""What factors did the AI consider when setting my rate?""Can a human review my application if I disagree with the AI decision?""How do you ensure your AI isn't biased against certain groups?"About your data:
"What information sources do you check besides my application?""Can I see what data you have about me?""How can I correct errors in my information?""Do you check my social media accounts?""How long do you keep my personal information?"Red Flags That Should Make You Worried
Warning signs of unfair AI practices:
Company won't explain why you were deniedThey can't tell you what factors affected your rateNo human is available to review AI decisionsThey refuse to correct obvious data errorsRates seem way out of line with other companiesNo clear appeals process for AI decisionsWhat Good AI Transparency Looks Like
Companies that do AI right will:
Show you exactly why you got your rate:
"Your monthly premium is $45 because:
Your age (32): Base rate $40Non-smoker: -$8 discount Excellent health: -$5 discountGood credit score: -$3 discountLives in safe area: -$2 discountTotal: $45/month"Explain their confidence level:
"We're 94% confident this rate is accurate based on your profile. If your health changes significantly, your rate may be adjusted."
Give you control:
"You can request human review of any AI decision. You can also see and correct the data we used to make this decision."
Your Rights When AI Makes Life Insurance Decisions
What the Law Says About AI and Your Rights
You have legal rights when AI is used in insurance decisions:
Right to know AI is being used:
Companies must tell you if AI helps make decisions about your applicationThey should explain what the AI looks at when evaluating youYou can ask for this information before you applyRight to human review:
If AI denies your application, you can usually request human reviewA real person should look at your case and the AI's reasoningThis review should consider factors the AI might have missedRight to correct errors:
If the AI used wrong information about you, you can demand correctionsCompanies must fix errors and reconsider their decisionYou shouldn't be penalized for data mistakes you didn't makeHow to Appeal an AI Decision
If you think AI treated you unfairly:
Step 1: Ask for an explanation
Request a detailed breakdown of why you were denied or got high ratesAsk which factors had the biggest impact on the decisionGet this in writing so you can review it carefullyStep 2: Check the data
Verify all information the AI used is correctLook for errors in your credit report, medical records, or driving historyDispute any incorrect information with the appropriate agenciesStep 3: Request human review
Ask for a human underwriter to review your caseProvide context that the AI might not understandExplain any special circumstances in your situationStep 4: Consider other options
Apply with different companies that might evaluate you differentlyWork with an independent agent who knows which companies are more lenientConsider different types of life insurance that might be easier to qualify forThe Bottom Line: You're Still in Control
While AI is increasingly making life insurance decisions, **you still have significant rights and options**. The key is to:
Stay informed** about how AI affects your applicationsExercise your rights** to explanations and appealsShop around** because different AI systems will treat you differentlyKeep your data clean** so AI has accurate information to work withRemember: AI is a tool to help insurance companies make decisions faster and more consistently. When it works well, it can actually make the process fairer and more affordable for most people. The important thing is making sure you understand how it works and that you're being treated fairly in the process.
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Sources:
LIMRA. (2024). *Technology Survey: AI Adoption in Life Insurance*. Retrieved June 2025National Association of Insurance Commissioners. (2024). *AI Governance in Insurance Guidelines*. Retrieved June 2025Federal Trade Commission. (2024). *Algorithmic Accountability in Financial Services*. Retrieved June 2025Consumer Financial Protection Bureau. (2024). *AI and Consumer Rights in Insurance*. Retrieved June 2025