Critical Illness Cover - Critical Illness

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A rated premium is when the insurance company increases the standard premium due to some area of concern that will have come to light during the underwriting process.  The standard premium will have been the amount quoted at the start of applying for the life insurance.  However, this quote is based on the amount of life insurance required, the term of the cover, the applicants’ sex, age and whether they smoke or not.  Before the policy can be issued an application form will need to be completed providing further information such as, height & weight, occupation, health, family health etc. 

If there is anything that the underwriters consider to put the applicant at a greater risk that would result in a claim then the monthly premium will be increased accordingly.  The greater the risk the greater the rating – increase on the premium.  Prior to any insurance company issuing someone a life insurance policy the person applying must first go through the companies underwriting process.  The underwriting process involves someone, the underwriter(s), looking at a number of different factors regarding the person applying for the life insurance. 

The applicant will have to complete the insurance companies appropriate application or data capture form providing the companies underwriters with various information about themselves.  Such information will include the following; their sex, age, if they smoke, height & weight, occupation, health, family health etc.  If the applicant has certain health issues the company may write to their GP for further information.  Once the underwriters feel they have everything they require they will then put forward an offer of cover to the applicant based on this information.

There are times when you will be faced with what is known as a rated premium. What this effectively means is that your standard premium can be increased by your insurance provider after some investigation. The reasons are generally due to some factor that may not have been disclosed or highlighted during the underwriting period.

A standard premium is understood as the figure that you will begin paying when your insurance policy commences. This amount is decided on the basis of

• Amount of life insurance you need
• The period of the cover
• The age and sex of the insured
• Vices such as alcohol and smoking etc.
 

These are the basic details, following which you will have to follow a more detailed questionnaire. This will include details of your height, weight, your career, your health as well as the family health history etc. 

At this point, if the underwriters feel there are certain aspects of your lifestyle or your case that increase your chances of making a claim from the provider, then your premium amount will rise accordingly. The higher the risk involved, the larger the rating or rather the higher the increase on the premium.  Before any insurance service provider gives you a policy, you will have to undergo a detail underwriting process that is in accordance with company procedure and protocol.

This will involves the underwriter or writers scrutinizing every aspect of your life before giving you the nod for a policy. As an applicant, you will have to complete all of these formalities in accordance with the rules of the company. If there are any pre-existing health issues with the applicant, then a GP from the side of the insurer will take the questioning and formality further. Only after the underwriter feels that they have all the information they need, will you be sent a offer on insurance cover.