Understanding the Basics of Insurance Underwriting

Insurance underwriting is the process by which an insurance company evaluates and approves applications for coverage and determines how much risk it is willing to assume by issuing a policy. This guide will explain what insurance underwriting is, what happens during this process, and how it affects the customer.

What is Insurance Underwriting?

Insurance underwriting refers to the process by which an insurance provider makes decisions about whether or not to offer a policy to an applicant, and at what cost. During this process, the insurer will assess the risk in relation to certain criteria and review several factors such as the applicant’s health, lifestyle and financial history. The underwriter will then calculate a premium based on their findings that can either be accepted or rejected by the potential customer.

How Does Insurance Underwriting Work?

Insurance underwriters are responsible for assessing risk and determining the cost of a policy. The underwriter will analyze the information given by an applicant, including their health, lifestyle, financial history and any other pertinent data that could affect the risk associated with them being covered. This allows them to decide whether to accept or reject an applicant’s coverage request, as well as determine the rate of the policy(premium).

What Kinds of Risk Factors Do Insurance Companies Consider During Underwriting?

Insurance companies will look at a variety of risk factors when underwriting a policy. These factors include an individual’s age, gender, health history, occupation, credit history, and driving record. By evaluating these elements insurance companies can determine the level of risk associated with insuring a particular individual. The higher the risk the more expensive the premium for that policy is likely to be.

How Can You Reduce Risks and Improve Your Chances of Getting a Lower Insurance Quote?

There are several steps you can take to increase your chances of getting an affordable insurance premium. Staying current on your medical check-ups and taking necessary steps to reduce health risks, such as losing weight, exercising regularly, and quitting smoking can also help you get more competitive quotes when shopping for insurance.

How can AI help the Insurance Underwriter Makes a Decision?

Using technologies offered by Vastmindz, insurance companies can remotely assess a customer’s health data by asking the applicant to perform a selfie-type task for approximately 40 seconds. The face is scanned for health data and using rPPG technology vital health signs are extracted, this combined with the information the applicant has provided gives a rich set of data by which an insurance company can help with its decision process. 

What Happens Once the Insurance Underwriter Makes a Decision?

Once the insurance underwriter has made a decision on your application, you will be informed of their decision. The underwriter will typically outline the terms and conditions of any policy they agree to offer you, which may contain specific exclusions or limits to coverages based on the risk profile associated with you. Depending on the insurer and type of policy, you may also have to provide additional paperwork or verification documents in order for the coverage to take effect. Once all the paperwork is completed, your policy will begin and be effective according to predetermined dates.


In conclusion, AI has the potential to revolutionize the healthcare industry by improving efficiency, reducing costs, and increasing access to care. The insurance industry is at the forefront of this transformation, using AI to provide personalized care, detect and prevent fraud, and manage risk. While there are challenges to implementing AI in healthcare, the benefits are clear, and the future looks bright for patients, providers, and insurers alike. With advancements in AI technology and increased adoption of AI in healthcare, we can expect to see further innovation and positive impact on the industry. However, it’s important to ensure that the implementation of AI is done ethically and responsibly, with a focus on data privacy and security, regulatory compliance, and unbiased decision-making. The insurance industry has an important role to play in shaping the future of healthcare, and with the help of AI, we can look forward to a more efficient, effective, and accessible healthcare system.

Nikhil Sehgal

Nikhil Sehgal
Improving health & wellbeing with AI | Founder/CEO @ Vastmindz | Forbes 30 Under 30