Digital Disruption Reshapes Life Insurance Operations — MIB - July 28, 2025

By Lane F. Cooper, Editorial Director, BizTechReports - July 28th, 2025

As digital transformation accelerates across the financial services sector, the life insurance industry—long characterized by legacy systems, complex regulations, and person-to-person interactions—is under increasing pressure to modernize. With shifting consumer expectations, regulatory complexities, and rising cost constraints, industry stakeholders are re-evaluating how life insurance is marketed, underwritten, and administered.

Recent studies underscore this urgency. According to a LIMRA and Boston Consulting Group survey, nearly 40% of life insurance executives identified technology as their company's greatest internal challenge, a significant increase from previous years. The study highlights digital automation and data analytics as top priorities for advancing marketing, distribution, and customer experience over the next five years. 

Andrea Caruso, Chief Operating Officer at MIB

A recent BizTechReports vidcast conversation with Andrea Caruso, Chief Operating Officer of MIB, provides insight into how the sector is adapting to—and shaping—these shifts. MIB, a member-driven organization with deep historical roots in fraud detection and compliance support, has expanded its footprint to include digital services that reflect broader changes in the market.

Legacy Industry, New Demands

Life insurance remains one of the most entrenched segments of the broader financial services ecosystem. With sales and underwriting traditionally tied to face-to-face interactions and extensive paperwork, the industry's operational tempo has often lagged behind others in embracing digital tools. But as Caruso notes, the industry’s inertia is increasingly untenable.

“Life insurance has historically been sold, not bought,” Caruso said, referencing the industry's position as an essential—if not necessarily desirable—component of responsible living in modern society.

Yet, demographic shifts and changes in consumer behavior are forcing a rethinking of distribution models. Direct-to-consumer (DTC) channels are gaining traction, particularly among digital-first buyers, while traditional brokers and agents are demanding tools that allow for hybrid or fully virtual engagements.

The Role of COVID-19 as a Market Catalyst

Caruso emphasized that the pandemic accelerated these trends, stating, “When you don’t have a choice, the industry’s ability to innovate accelerates.” 

The pandemic, she noted, prompted life insurers to reassess the viability of in-person engagement, forcing rapid investment in platforms for remote consultations, e-signatures, and digital onboarding. For many insurers, these changes highlighted structural inefficiencies and created urgency to replace fragmented, manual workflows with scalable alternatives. It also prompted reassessments of underwriting practices, particularly in relation to remote access to electronic health records (EHRs) and medical data.

Research supports this shift. A study by TransUnion found that digital adoption in the insurance sector grew by approximately 20% globally in 2020, marking an increase of almost four times the compound annual growth rate of the prior four years. This surge was driven by the need for digital solutions to meet changing consumer habits during the pandemic. 

Despite the clear efficiency gains offered by digitization, operational tension remains between customer experience and risk mitigation. Caruso characterized this dynamic as an exercise in being “responsibly aggressive”—adopting technologies that drive speed and convenience while maintaining high standards for data security, regulatory compliance, and fraud prevention.

This balancing act is particularly challenging in life insurance, where processes must support multi-party interactions involving clients, brokers, underwriters, carriers, and in some cases, reinsurers and trustees. “It’s no longer a simple one-to-one transaction,” Caruso noted. “Processes have to accommodate a range of stakeholders without creating friction.”

E-Signatures as a Case Study in Ecosystem Friction

The integration of e-signature platforms into insurance workflows provides a useful lens for examining how ecosystem-wide changes are managed. While digital signature solutions have existed for years, their application in life insurance requires industry-specific configurations and consensus around security protocols and validation processes.

MIB’s experience in developing a customized e-signature product highlights the market’s need for sector-specific tools rather than generic digital infrastructure. “Off-the-shelf tools can work, but they often miss the nuances,” Caruso explained. This suggests that vendors must tailor solutions to align with the industry's complex compliance environment or risk rejection by carriers and advisors.

To address this, MIB has developed an e-signature solution designed specifically for the life insurance industry. This platform incorporates features that meet the stringent regulatory requirements and security standards unique to life insurance transactions, facilitating smoother adoption across the industry.

Data Access and Underwriting Efficiency

Another area of significant change is the use of data in underwriting. Increasing access to electronic health records (EHRs) and third-party medical data sources enables insurers to streamline their risk assessment processes. Additionally, access to digital tools during the sales process can help advisors ask the right questions up front so they can set realistic expectations on what offers may be available, instilling client confidence. Caruso pointed to MIB’s “eValuate” platform as one attempt to shift some of this analysis upstream, arming brokers and advisors with insights during the initial stages of engagement—and reducing the incidence of stalled or rejected applications downstream.

The strategic goal is to bring underwriter-level awareness into early conversations, improving alignment between customer expectations and actual policy terms. This mirrors a broader market trend toward prequalification and risk triage in financial services.

Fragmentation and Integration Challenges

Despite advances, the life insurance industry remains fragmented, with wide disparities in digital maturity among carriers and distributors. While some insurers are building digital-first capabilities, others are constrained by legacy systems and limited IT resources. Caruso acknowledged that “paralysis by analysis” remains a persistent problem, with some firms hesitating to commit to transformation due to uncertainty, complexity, or even starting over due to leadership turnover.

This has opened the door to modular, API-enabled solutions that can be integrated incrementally. Caruso underscored the importance of flexibility in platform design, noting that “forcing clients to re-engineer their entire operation creates resistance and implementation fatigue.”

As a result, a phased approach may make more sense. Many insurers are starting by integrating electronic health records into existing workflows before overhauling the entire underwriting process. This incremental implementation allows firms to adapt select elements gradually, reducing disruption and resistance.

To address the complexity of scaling data services and analytics, MIB has entered into strategic partnerships—notably with reinsurer Munich Re—to expand predictive risk modeling capabilities. These collaborations reflect a broader trend toward platformization in life insurance, where shared infrastructure serves as a hub for data exchange, workflow orchestration, and regulatory compliance.

MIB’s evolution from a single-service provider to a multi-product platform echoes similar transitions in adjacent industries, such as banking and mortgage servicing. However, the sector’s regulatory overlay—which varies by jurisdiction and product type—adds complexity to scaling these models.

Outlook: A Sector in Transition

Looking ahead, the digitization of life insurance appears inevitable but incomplete. Carriers, reinsurers, and distributors are investing in technology, but the pace and depth of transformation vary significantly. Adoption remains influenced by structural constraints, cultural factors, and divergent views on risk.

Caruso sees continued evolution: “Five years can go by in a blink, but a lot can change. The question is whether the industry will adopt in a coordinated way—or continue to innovate in pockets.”

As insurers face mounting pressures to streamline operations, improve customer engagement, and comply with an evolving regulatory landscape, stakeholders will need to strike a balance between innovation and institutional trust—a dynamic that will likely define the sector’s future for years to come.