subject: Maryland Life Insurance: Underwriting 101 [print this page] Maryland Life Insurance: Underwriting 101
When you talk about underwriting basics, you begin by understanding what underwriting is. Underwriting is the process of evaluating the risk of insuring someone for Maryland life insurance, rating and classifying things or people.
An underwriter is a person who is responsible to determine, based on the insurance company's desires and needs, whether or not it is a good idea to insure a person or thing. The underwriter will use resources such as medical information, exams, and a policy application in order to determine if the person is a good risk for the insurance company.
The application for Maryland life insurance is one of the most important documents involved in underwriting a life insurance policy. The application is divided into two definite segments and is carefully reviewed by the underwriter to determine if everything is accurate. The first part of the application is the general information and is referred to as part 1.
This includes information such as name, date of birth, social security number, occupation, address, marital status, and things of that nature. Part 2 of the application is focused on medical information, such as current physical condition, medical history, and even things like personal morals. These two parts are really important in determining risk.
Sometimes when applying for Maryland life insurance, an underwriting guideline may require that the applicant get medical examinations performed. This is a fairly common requirement for life insurance. Some policies are very limited in coverage, and these policies are less likely to require a medical exam. Sometimes, inspection reports are also obtained.
These reports can look into a wide variety of life risk aspects, including financial information, health, character, hobbies, occupation, or even habits. This type of report is often used to determine the insurability of an individual.
One additional source of information that is often used in determining insurability for Maryland life insurance is the Medical Information Bureau. It is a huge resource for the people who write life insurance policies and a part of the underwriting process for many. Determining if a potential insured is insurable is the process of underwriting, and it is an important step in ensuring that the rates an insurance company offers can remain fair.
Sometimes, if an applicant for insurance is not a prime candidate, a different rating of insurance can be offered. Underwriting is a process that cannot be overlooked by insurance companies, and it is vital to the life insurance field.
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