"The decision is binary, yes or no, based on the price we originally offered," says Hug. "Between 50 and 70 percent are approved and no paper is involved."

Hug points out that Prudential is governed by federal privacy laws and takes in much of the same information before it issues a traditional policy.

"Most people are honest," he observes.

The cost for a "virtual exam" life insurance policy is slightly higher than a normal term policy. But analysts say it's a price many people would be willing to pay for the convenience of a quickly issued policy that doesn't involve lab tests. The difference is about $3 a month for a younger person.


Hug says his goal is to speed up the life insurance application process and, once refined, to put it out on the market for everyone, in effect, creating a GEICO-like process for life insurance.

"Our Holy Grail is for our regular product and our electronic product to be equivalent in price," he says, "and to offer 15-minute life insurance."

'No muss, no fuss'

Insurance analysts say Prudential's electronic approach to buying life insurance is innovative and could be a game changer.

"For the consumer, the products promise no muss, no fuss, no in-home medical specimens," says insurance analyst Donald Light of Celent Research. "Prudential could see strong sales for both products."

Steve Weisbart, chief economist for the Insurance Information Institute, says, "This could definitely increase Prudential's ability to sell, particularly among moderate-income people who haven't got time to sit around the home or office waiting for someone to give them a physical." Many people simply don't like the invasiveness of a physical, particularly by a stranger, he adds.

Life insurance companies like Prudential need to move quickly to regain lost ground. Less than half of all American households have individual life insurance, according to LIMRA, an industry research group, which says that during the first three months of this year individual life insurance growth rates declined by 5 percent in the number of policies written.

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