MTHEL131 Lecture Notes - Disability Insurance, Parachuting, Life Insurance
7 Nov 2013
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Document Summary
Decisions underwriters could make based on the application: declined. Due to medical condition, etc: standard (accepted) regular premiums is the case 70% of the time, rated policy cause: applicant poses higher risk than others in the same age group. Higher than average premiums it is up to the applicant whether to accept this offer is not permanently substandard. Ex. if obese person lost weight, premium would lower. Ex. if smoker quit, premium would lower. A frequent skydiver will be fully and regularly covered, unless he dies skydiving. Odds of becoming disabled (for at least 3 months) between now and 65 years is. Types of disability: due to accident likelihood decreases as age increases, due to illness- likelihood increases as age increases. * biggest difference between underwriting for disability insurance and life insurance is a person"s occupation. Types of policies (disability: non-cancellable (guaranteed renewable) cannot be cancelled cannot reduce policy cannot raise premium.
