Health Insurance Mastery Practice Exam

Which factor is NOT considered in underwriting group insurance?

1. Health status of the group

2. Group size

3. Individual medical histories

4. Occupation type

The correct answer is: Individual medical histories

In the context of underwriting group insurance, the determination often focuses on evaluating the overall characteristics of the group rather than the individual members’ medical histories. Group underwriting typically assesses collective factors such as the health status of the group as a whole, the size of the group, and the types of occupations represented. The health status of the group involves considering the collective risk posed by the group, which can often be influenced by the overall demographics or industry. The group size is also essential, as larger groups tend to spread risk more effectively, thereby influencing premiums and coverage terms. Additionally, the occupation type plays a significant role in assessing risk, as certain occupations may present higher or lower risks of injury or illness. Individual medical histories, on the other hand, are not considered in group insurance underwriting. This approach recognizes that group insurance is based on the premise of collective risk management rather than evaluating individuals. The rationale is that within a large group, individual variances in health may balance out, making it unnecessary to delve into individual medical histories during the underwriting process. Thus, while group characteristics guide underwriting decisions, the individual health details of each member do not directly affect the underwriting outcomes for the group as a whole.