Page 54 - MEDICAL AND HEALTH INSURANCE

MEDICAL AND HEALTH INSURANCE

 application form

 medical history and examination report

 hospital medical record

 agent's statement

Upon evaluating the proposal, the underwriter will determine if the

application for insurance will be:

a) accepted as preferred basis

b) accepted as standard basis

c) accepted as substandard basis

d) rejected

3.1.2 AN EXAMPLE ON PREMIUM LOADING AFTER A CLAIM

Generally, all insurers have their own respective internal PMI underwriting

guide and strategy of re-pricing adopted for underwriting this class of PMI
business. It will outline the risk tolerance level at which re-pricing is

required; in the event that the loss ratio deteriorates and hits the

threshold loss target.

Some may have a greater risk appetite, whereas others may differ but

whatever the outcome, there will be a final premium loading after an
adverse claim, as the risk premium would not be sufficient to cover the

loss.

The loading factors differ between individual and the group PMI policies

and also whether it is a yearly renewable policy or guaranteed renewal

policy, on portfolio re-pricing.

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