If on analysis the information collated shows that
the individual is in good health, then he or she is likely to live as
per the "pure risks" calculations. If on the contrary the
individual is suffering or has suffered from a serious illness (e.g.
high blood pressure) then, statistics have shown this can shorten the
person's life expectancy.
Such individuals are often referred to as 'under
average lives', and often the insurer will charge an extra premium to
reflect the higher risk. The underwriter can choose to apply a 'debt' to
the policy. This is generally used in an endowment policy where the
death benefit has less importance than the maturity value. If the
individual dies prior to maturity then the debt would reduce the death
benefit. These debts can be either level or decreasing, depending on the
individual health details.
It is generally true that most underwriters try to
avoid declining to insure applicants preferring instead to defer a
decision for 6 to 12 months when a more accurate selection can be made.
||Finally no section on underwriting would be
complete without a mention of genetic testing. These tests may show the
susceptibility of an individual to contracting certain inherited
conditions or illnesses. The tests are in their infancy and their use is
limited. Some say that if they were used extensively then the need for
underwriters would diminish and many individuals would find that the
cost of cover was greatly increased or even unavailable.