What Is Underwriting?

Underwriting is a term frequently used in the insurance industry which means an evaluation of your health, lifestyle, and financial history.  For example, in order to buy a life insurance policy you will need to complete an application and have at least a brief medical exam including blood and urine tests.  Your application will then go to underwriting where an underwriter will look at your test results, medical records, family’s health history, driving record, finances., etc. to determine your eligibility for life insurance as well as what premium you should pay.  All of the information gathered during the application and underwriting process is confidential.

Medical insurance used to be underwritten and individuals were often declined due to their health history.  Now with the Affordable Care Act, aka Obamacare, individuals may no longer be declined coverage or charged an increased premium due to health history.  However, individuals must apply during the annual open enrollment period or within 60 days of a qualifying event in order to be approved for coverage.