Life insurance underwriting, explained
Underwriting is essentially how life insurance companies decide whether to approve or deny your application.
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Defining life insurance underwriting
Every life insurance applicant comes with risk levels, as determined by the life insurance company. Underwriting is the insurance company's process for establishing those risk levels and determining whether they're able to offer life insurance coverage to the applicant and the premiums they charge.
What does the life insurance underwriting process involve?

After you submit a life insurance application, underwriting begins. The underwriting process lets life insurance companies determine whether they can offer life insurance coverage to applicants and the premiums they charge.

The insurance company will determine your risk level, based on individual factors. The carrier is "at-risk" with every accepted applicant because they're contractually obligated to pay a death benefit if you die while coverage is in force. Some applicants present more risk than others and your risk class is used to determine how much it will cost the carrier to insure you. Using their established insurance underwriting guidelines, actuarial science, historical mortality data, and your unique risk factors, the carrier determines the premium rate necessary to issue your policy.

There are various factors (which can vary by state) underwriters consider when determining your level of risk, including your:

  • Age
  • Gender
  • Tobacco and alcohol use
  • Personal health situation and medical history
  • Family health history
  • Driving record
  • Criminal record
  • Previous and concurrent applications for life insurance
  • Financial position
  • Foreign travel
  • Occupation
  • Hobbies
Could my life insurance application be denied?

Individual life insurance companies may have a different approach to weighing risk factors and evaluating risk, meaning premium quotes may vary from one company to another. Insurance companies can deny you coverage if they believe you present too much risk. However, because each company's underwriting process varies, their decision-making process also will.

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What is the underwriting process timeline?

Traditionally, the insurance underwriting process has been complicated, and applicants could wait months before receiving a decision. Ethos has simplified underwriting, using modern technology and predictive modeling to speed up the life insurance underwriting timeline and get you a decision faster. No medical exam is required, and applicants typically receive a decision in days, if not instantly.

To help the underwriting process go more smoothly: 

  • Answer every question on your application with as much detail and accuracy as possible
  • Complete any follow-up questions in a timely manner
What are the different approval processes?
Different types of life insurance require unique underwriting processes (and some don't require any). The most common are:
  • Fully underwritten life insurance offers coverage for a certain period (usually 10, 20, or 30 years) and traditionally requires applicants to fill out a full application and take a medical exam. Note that Ethos uses a health questionnaire and does not require a medical exam for its policies.
  • Simplified issue underwriting life insurance is a much easier process than fully underwritten life insurance. Rather than having to take a medical exam, applicants are usually simply asked some health-related questions.
  • Guaranteed issue life insurance usually doesn't require any medical underwriting. Applicants will be accepted for life insurance without medical records, a medical exam, or needing to answer any health questions.

Term life insurance policies through Ethos are either fully underwritten or simplified issue underwriting, depending on what you qualify for.

If you qualify for a simplified issue policy, you only need to answer a few health-related questions and may even get approved instantly. Ethos' whole life policy is guaranteed issue, so applicants who meet the standards will be guaranteed coverage.

What influences my premium rate?

Certain risk factors are out of your control, such as family medical history. But you can take action to influence your premium rate. Since your premium is dependent on your health and lifestyle choices, having healthy habits can help decrease your premiums. For example, balanced eating and regular exercise can help you maintain a healthy BMI, which is a key influencer of life insurance premiums. And if you smoke, quitting may lower your life insurance rate.

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