After you apply for life insurance, the life insurance company evaluates your application details, health information, and lifestyle to determine your overall risk and decide how much you’ll pay for coverage. This process is called underwriting.
Underwriting takes an average of four to six weeks from start to finish, but if you’re eligible for accelerated underwriting you could have your application reviewed the same day you apply. Here’s what you should know about underwriting and what to do to ensure a smooth process.
What does an underwriter do?
Once you’ve submitted your application for life insurance, the insurer will appoint a representative to verify the information you provided. This person is called an underwriter. They’ll assess your overall risk before the insurer agrees to give you a life insurance policy.
While every insurer generally follows the same steps for underwriting, the specific ways they calculate risk and determine the cost of your premiums is specific to each company.
How long does underwriting take?
Standard underwriting can take four to six weeks on average. During this time you may need to take a medical exam or have records sent to the insurance company from your doctor. This can add time to your process, but will allow the insurance company to verify all the information they need to make you a fair offer of coverage.
If you don’t have many health issues, only take a few medications, and don’t participate in hazardous activities, the insurance company may determine that you can skip the medical exam and evaluate your risk based solely on your health records. In this case, you may be eligible for accelerated underwriting, which could take less than two weeks, or instant underwriting, which may only take a matter of minutes.
Working with a Policygenius agent can help you make sure you’re applying with the insurer who will be able to offer you coverage at the best price. With Policygenius, you’ll also have support during underwriting to help your application progress as efficiently as possible.
Life insurance underwriting step by step
From reviewing your life insurance application to determining your final rates, this is what you should expect from the underwriting process.
Step 1: Application quality check
First, your life insurance agent will help prepare your life insurance application and make sure all of the correct information is there. The process will include a phone interview that usually takes between 15 and 30 minutes and covers your health history, hobbies, and finances.
After that, you’ll start the official life insurance underwriting process. Each step can add some time to your application, but they’re necessary to finalize the cost of your premiums over the life of your policy.
→ Learn more about what to expect from the life insurance phone interview
Step 2: Medical exam
If you need a medical exam, your agent will set it up for you. The life insurance medical exam is similar to a checkup with your doctor, except it’s free — the insurance company you’re applying with will cover the cost. A medical technician will perform the exam at a lab, in your home, or at your office to gather the following information:
Basic measurements: Height, weight, and blood pressure. Your height-to-weight ratio plays a role in how you’ll be classified and what you’ll pay for your policy. A high blood pressure reading can become a concern as you get older and can impact your rates.
Blood analysis: A simple blood test can identify potentially risky health concerns. Heart disease, stroke, diabetes, blood-borne illnesses, and more can all be analyzed using a few vials of blood.
Drug analysis: A urine test for a full drug panel will alert the underwriter to the use of drugs like amphetamines, cocaine, and barbiturates.
The results of your exam are sent to the underwriter to help determine your insurance risk. Here are a few more details you should know about the medical exam.
You can reuse the results of your medical exam to apply for other types of insurance, like disability insurance, or even for life insurance from another provider.
Exam results are typically valid for six months to one year, depending on your age.
You’re under no obligation to accept a life insurance policy just because the insurer paid for your medical exam.
Some policies don’t require a medical exam for approval, including no-exam life insurance and guaranteed issue life insurance. A licensed agent can help you determine whether any of these options are a good fit for you.
→ Learn more about how to prepare for the medical exam
Step 3: MIB check
The Medical Information Bureau (MIB) is a trade group that helps insurance companies share medical data and prevent fraud. It allows underwriters to see details about your medical records from previous life insurance applications (dating back three to five years).
If you’ve applied for life insurance before, an MIB check won’t hurt your risk classification. The MIB just shows the date of any medical impairments, treatments, and diagnoses as reported by previous underwriters.
If you didn’t disclose pertinent information when you applied or provided details that were wrong, the MIB will verify the correct information so the insurer can evaluate your application accurately.
Step 4: Prescription check
The underwriter will check all the medications prescribed to you over the past three to five years. As with the medical exam and MIB check, the prescription check confirms the information in your application.
It’s important that you disclose any medications you were prescribed and any medical diagnoses you received. If a medication shows up on a prescription history check for a medical condition that you did not disclose, the underwriter will be more cautious about your case.
Step 5: Attending physician statement
If the insurer has any additional questions about your health history, the underwriter will order an attending physician statement (APS). An APS is a summary of your medical history from your doctor’s point of view.
For example, if you had high blood pressure during your exam, an APS would let an underwriter know the underlying cause. This step can prolong the underwriting process, adding anywhere from a few days to a few months, depending on how long it takes for a doctor’s office to comply with the request.
If the insurer needs an APS, they’ll reach out to your medical provider directly for the information. You may be required to sign an authorization form allowing your medical provider to share your personal information with the underwriters.
Step 6: Motor vehicle report
A motor vehicle report, or MVR, details your driving history as far back as seven years. It notes driving violations like traffic citations — for example, speeding or reckless driving tickets — vehicular crimes, accident reports, driving record points, and DUI convictions.
Your premiums will be higher than someone who has a clean driving record if your MVR reports anything concerning. If you have a recent DUI on your record, you may be denied a policy.
Keep in mind that failing to disclose information will only work against you. If you do have serious traffic violations or DUIs in your past, it’s best to disclose these up front so your agent and underwriters can work with you on finding the best policy.
Step 7: Credit history
Life insurance companies will request a soft credit check when you apply. Your credit score will not directly affect what you pay for premiums, but the insurance company does look for a degree of financial stability before they offer you coverage.
If you have a bankruptcy, large debts, or lots of missing payments, the insurance company may consider you a higher-risk applicant. This could result in limited insurance options or a less favorable risk classification, which makes life insurance more expensive.
Step 8: Your final rating
Once the underwriter has verified the information you submitted and assessed your risk, the insurance company will make you an official offer of coverage. Your offer will include an overall risk class and price for the amount of coverage you applied for.
After you receive the offer, you’ll just need to sign the paperwork and pay your first premium for your coverage to begin.
What factors are considered in underwriting?
All insurance products involve some degree of underwriting to get a picture of your personal background and any risks related to the kind of insurance you’re purchasing. Here’s how underwriters look at each of the following aspects of the application:
Gender: Females generally get lower life insurance rates than males because they live approximately six years longer than men on average in the U.S., according to the Center for Disease Control and Prevention. [1]
Age: Premiums are less expensive when you’re younger because you’re usually healthier and your risk of dying while your policy is active is lower.
Health history: One of the most important life insurance underwriting factors. The healthier you are, the better your rates will be because your mortality risk will be lower.
Tobacco use: Smokers will pay more for life insurance than non-smokers because the use of tobacco has known negative health effects. If you have medical conditions caused by tobacco use, that will increase the cost of your premiums even further.
Income and net worth: The amount of insurance you buy should roughly match the financial loss your family will experience if you pass away.
Coverage amount: An insurer might do more to check your risk if you apply for a higher-than-average death benefit. The underwriter will use your financial details to make sure you’re not getting more coverage than you need.
Existing coverage: If you have other life insurance policies, underwriters check to make sure you aren’t applying for too much insurance.
Insurable interest: The person buying a policy on you needs to be able to prove they’d suffer financially if you passed away. Since people usually buy a policy for themselves or their spouse, it’s rarely an issue.
Foreign travel: Countries fall into categories based on safety issues, medical care availability, and government stability. Travel to countries of concern can make you uninsurable. The frequency of travel and length of stay is also considered. (More on this below.)
Hobbies: Like your job, certain hobbies — like aviation — will affect your rates if there’s an increased risk to your life or health.
Occupation: Most occupations are considered safe, but some jobs represent a higher insurance risk. Lumber workers, for example, could require a flat extra fee, or be declined.
Military service: Military members with more dangerous duties (fighter pilots, Navy SEALs, or people being deployed to dangerous areas) could be ineligible for private life insurance.
Criminal history: Misdemeanors won’t have a big impact on your rates, but people convicted of felonies who are currently on probation will be declined.
Driving record (MVR): A risky driving history (speeding, accidents, or DUIs), can raise your rates or lead to an application decline.
Drug use: Using cannabis won’t keep you from getting a policy, but using hard drugs can result in an application decline.
Previous applications: Your previous life insurance application records, including health classifications or declines, can notify the underwriter of potential concerns.
Because every insurance company has its own underwriting rules, how much each of these factors impacts your rates will vary. The best life insurance company for you will depend on your specific needs and history.
The best way to find an insurer that will offer you the most affordable policy for your personal situation is to work with an independent broker. At Policygenius, our experts are licensed in all 50 states and can walk you through the entire life insurance buying process while offering transparent, unbiased advice.
Frequently asked questions
How long does life insurance underwriting take?
It usually takes about four to six weeks from the time you apply for life insurance to the moment your policy goes into effect. Ordering certain medical records or scheduling the standard medical exams that’s part of the application process can extend that timeline. No-medical-exam life insurance can offer approval in less than two weeks, and in some cases even on the same day.
What do life insurance underwriters look for?
The underwriter looks for risk factors that could shorten your lifespan, like a smoking habit or a history of illness. The more risks you present, the more you’ll pay for your policy.
What’s the difference between a life insurance company and an underwriter?
An underwriter works on behalf of the insurance company. It’s their job to evaluate your risk, so the insurance company can determine the cost of your premiums and make an official offer of life insurance coverage.
What’s the difference between individual underwriting and group underwriting?
Individual underwriting is a lot more exhaustive than group underwriting. If you apply for individual coverage, the underwriter will gather all the needed information to assess your individual mortality. With group life insurance, you’ll have to provide very little personal information. One policy will be issued to your whole group and the risk will be based on estimated averages of the whole group.
Is accelerating underwriting cheaper than standard underwriting?
There’s no financial incentive for you to go through accelerated underwriting instead of standard underwriting, but if you qualify for accelerated underwriting, you usually don’t have to take a medical exam and you’ll get your insurance coverage faster.
