You have submitted the application — what is the company doing while you wait? This article explains the underwriting process in plain terms, so you know what each possible outcome means.
What underwriting is
It is the process by which a company assesses each applicant's risk in order to decide whether to accept the risk and on what terms. The thinking behind it is to make the premium reflect the risk fairly for every insured person in the system.
What the company considers
- The information on the application, particularly the health declaration, treatment history and existing conditions.
- Age, sex, occupation, and risk behaviours such as smoking.
- The sum insured requested, compared with income and need.
- Medical examination results or further medical documents, where the company requests them.
Not everyone has to undergo a medical examination — it depends on age, the sum insured, and each company's criteria.
The possible outcomes
The outcome is not only "accepted" or "declined." There are several forms:
- Accepted on standard terms — at the plan's standard premium.
- Accepted with conditions — a loaded premium according to the risk, or an exclusion for certain conditions.
- Deferred — asking to see symptoms or treatment results before deciding.
- Declined — where the risk exceeds what that plan can accept.
Having conditions attached is not always a bad thing, because at least the remaining cover is in place, and some conditions can be asked to be reviewed once your health improves, under the company's criteria.
How to prepare for a smooth process
Declare information truthfully and completely from the start, have the relevant treatment history ready, and answer the company's follow-up questions promptly. Those three greatly reduce the waiting time and the chance of a problem with the contract later.
In short
Underwriting is the checkpoint that makes an insurance contract solid from the outset. An applicant who understands the process and gives information straightforwardly usually receives a clear decision and cover that can genuinely be claimed on the day it is needed.