Sources of Underwriting Information

Insurance underwriters gather information from multiple sources to make informed decisions about risk classification. Understanding these sources is crucial for exam preparation and professional practice.

The Application

The insurance application is the primary source of underwriting information. It captures essential data directly from the applicant.

Application Components

Agent's Report

The agent's report (or producer's report) is the agent's personal observations about the applicant:

• General appearance and demeanor
• Apparent health and fitness
• Accuracy of information provided
• Purpose of insurance
• Any concerns about the application

Exam Tip: The agent has a duty to report any information that might affect underwriting, even if not specifically asked on the application.

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Medical Examinations

For larger policies or when health concerns exist, the insurer may require a medical examination.

Paramedical Examination

A paramedical exam is conducted by a trained paramedic or nurse and typically includes:

Full Medical Examination

For large policies or specific concerns, a full medical exam by a physician may be required:

• Complete physical examination
• EKG/ECG for cardiac function
• Stress tests if indicated
• Specialist consultations
• More extensive blood panels

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Attending Physician Statement (APS)

An Attending Physician Statement (APS) is a report from the applicant's personal physician containing medical records and history.

APS Contents

APS Limitations

• Can take 2-4 weeks or longer to obtain
• Adds to underwriting time and cost
• Physicians may be slow to respond
• Information may be outdated

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Medical Information Bureau (MIB)

The Medical Information Bureau (MIB) is a nonprofit organization that maintains a database of coded medical information shared among member insurance companies.

How MIB Works

What MIB Does NOT Contain

• Actual medical records or test results
• Specific diagnoses in plain language
• Insurance decisions (approvals/declines)
• Claim information

Consumer Rights Under MIB

Exam Tip: MIB is NOT a credit bureau. It contains coded medical information from insurance applications, not medical records or credit history.

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Inspection Reports

For larger policies or business insurance, insurers may order inspection reports from third-party companies.

Types of Inspection Reports

Fair Credit Reporting Act (FCRA)

Inspection reports are considered consumer reports under the FCRA, which requires:

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Other Information Sources

Prescription Database (Rx Check)

Insurers can access prescription database reports showing medications prescribed in recent years:

• Reveals conditions the applicant may not have disclosed
• Identifies drug use patterns
• Cross-references with application answers

Credit Reports

Credit history may be used to assess:

• Financial stability
• Risk-taking behavior
• Potential moral hazard
• Likelihood of policy lapse

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Key Takeaways

• The application is the primary underwriting information source, completed by the applicant and agent
• Paramedical exams include blood and urine samples for routine screening
• The Attending Physician Statement (APS) provides detailed medical records from the applicant's doctor
• MIB stores coded medical information from previous applications (not actual medical records)
• Inspection reports gather lifestyle, financial, and background information
• The Fair Credit Reporting Act requires notice, consent, and disclosure rights for consumer reports
• Prescription databases reveal medication history that may indicate undisclosed conditions