About Underwriting In Health Insurance

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About Underwriting In Health Insurance

December 22, 2015
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Health insurance, at first glance, is a pretty simple concept. Pay for coverage so that your medical bills will not cripple you if ever a serious illness or an accident occurs. After all, it’s not unheard of for a medical emergency to bankrupt a family, which makes their situation even sadder. Unfortunately, this coverage comes with a lot of riders, clauses, stipulations and whatnot that makes it a little more complicated than it really ought to be. Today, we’ll be talking about underwriting as far as health insurance goes so that you understand what this is about and how it directly affects the benefits you get.

The Matter Of Risk Classification

When it comes to health or any kind of insurance, insurance companies make a lot of effort to make sure that they will not put their other clients at risk by surpassing their capacity to provide coverage. As such, they make sure to assess the risks of potential clients to get sick, get injured, die, or pull out. As a result, different people will have different types of insurance plans, different premiums and different clauses. These are what comes from underwriting.

Specific Underwriting Requirements

Even before your case is reviewed by the insurance companies, you would have to first pass the underwritten requirements already in place. These requirements will determine if you are accepted, rejected or would have to follow specific protocol in order to gain the protection that their plans would provide you with.

As just an extreme example of what would disqualify you from getting insurance from most major providers, someone who already has a fatal illness would certainly fit the bill of one who cannot be insured. For one thing, that person would not likely be able to pay off the premium of the insurance to maturity and for another, the company already knows that such a person would collect. Not only will this put the company at a disadvantage profit wise, it would also put other insured individuals at risk.

Your Own Application

Most of the information that the insurance company will use comes from your own application as well as the answers that you gave to the questions that they ask. Of course, they might look a little into your own background and history just to be sure, but they won’t likely find anything worth adding if you have already provided them with everything truthfully.

As we have already mentioned before, other lifestyle factors affect your premium when applying for health insurance as well. So don’t assume that your current health and family history will be the only things affecting how much you’re paying.