Which term pertains to the analysis of an applicant's personal information and determining whether insurance should be issued or declined?

• A. Underwriting
• B. Premium
• C. Rating
• D. Appeal

Answer: (A)

Underwriting is the process of evaluating an applicant’s personal information and health history to decide whether insurance should be issued and on what terms. The underwriter reviews factors such as age, medical history, family history, occupation, lifestyle, and results from any medical exams or records. This analysis determines if the risk is acceptable, and if so, whether the policy is issued at standard terms, at a higher (substandard) premium, with exclusions, or declined.

Premium, by contrast, is the price charged for the coverage. Rating refers to the classification used to set that price (standard, preferred, substandard) based on underwriting results. Appeal is the step an applicant can take to challenge a underwriting decision.