What Is Life Insurance Underwriting?

Life insurance underwriting is the process by which a life insurance policy is priced. Life insurance underwriting is a very detailed process that looks at several factors to decide what your premium rates should be. Here are the basics of life insurance underwriting.

Procedure

Life insurance underwriting is all about assessing your risk level. The insurance company has to take a look at you and make their best guess as to how long you will live barring any unfortunate accidents. They can do this by grouping you into groups that they have statistical information about. With this method, they will want to know many things about you, so that they can make an educated guess.

Factors

There are many factors that go into underwriting a policy for someone. They will ask you for your age, sex, health history, and whether or not you use tobacco. Tobacco use can affect your rates greatly. They will also want to know your occupation as some of them are more hazardous than others.

You will usually have to take some sort of health exam as well. With this information, they can tell you exactly how much you should pay for your premiums.

 

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