Underwriting

Underwriting is how an insurer decides whether to offer cover, on what terms, and at what price. It weighs age, health history, family history, build, tobacco use, income and occupation.

Most applications are accepted as applied for. Some are accepted on altered terms, and a few are declined. The depth of questioning varies far more between product categories than between insurers.

Related terms

• Underwriter The person who assesses an application and decides the terms on which cover is offered.
• Proposal form The application document. Its answers form the basis of the contract.
• Loading An increase to the standard premium, reflecting a risk the insurer has assessed as higher.
• Non-medical limit The most cover an insurer will issue on a declaration alone, without a medical examination.

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