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Zorluk: Çok zorRisk Classification

An underwriter is evaluating a life insurance application for a 42-year-old applicant seeking a $500,000 whole life policy. The applicant's attending physician statement (APS) indicates a five-year history of Type II diabetes requiring daily insulin therapy. Furthermore, the application reveals that the individual's primary occupation is a professional structural ironworker on high-rise buildings. According to standard underwriting principles regarding risk classification and premium determination, which of the following describes how the insurer will most likely categorize and price this exposure?

  1. Classify the applicant as a Substandard risk, utilizing a tabular rating for the health condition and assessing a flat extra premium for the occupational hazard.Cevap
  2. B
    Classify the applicant as a Substandard risk, utilizing a flat extra premium for the health condition and assessing a tabular rating for the occupational hazard.
  3. C
    Classify the applicant as a Declined risk, as the combination of a chronic illness and a physical hazard creates a speculative risk that life insurers cannot legally accept.
  4. D
    Classify the applicant as a Standard risk subject to an occupational exclusion, because the dangerous profession is considered a morale hazard that invalidates premium surcharges.

Cevap

Classify the applicant as a Substandard risk, utilizing a tabular rating for the health condition and assessing a flat extra premium for the occupational hazard.
The correct answer accurately identifies the applicant as a Substandard risk and correctly applies the two distinct rating methods. Underwriting principles dictate that a tabular rating is used for medical conditions (like diabetes) because the risk of mortality increases with age, requiring a proportionate premium increase. Conversely, a flat extra premium is applied for hazardous occupations (like ironworking) because the risk remains constant regardless of the insured's age.

Adım Adım Çözüm

1
Evaluate the applicant's overall risk profile based on the medical and occupational data.
The combination of Type II diabetes and a hazardous occupation (structural ironworker) clearly places the applicant in the Substandard risk category.
Standard premiums assume average health and safe occupations; significant deviations require substandard classification to ensure adequate premium collection for the assumed risk.
2
Determine the appropriate premium rating method for the medical condition (Type II diabetes).
A tabular rating (table rating) is selected.
Health conditions typically present a mortality risk that increases as the insured ages, which is best addressed by applying a percentage increase to the standard rate via an underwriting table.
3
Determine the appropriate premium rating method for the occupational hazard (structural ironworker).
A flat extra premium is selected.
Occupational hazards generally present a constant level of risk that does not organically increase with the insured's age, making a fixed dollar amount per thousand of insurance the standard approach.

Anahtar Kavram

Substandard Risk Rating Methods (Tabular vs. Flat Extra Premium)
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Konular

Risk Classification

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