With guaranteed renewability regulation, insurers have to adopt information-based and scientific individual underwriting processes. As a core operation for any insurer, appropriate risk assessment and selection is critical for business success.
Underwriting teams need updated information and effective tools to aid their decision making. Milliman has developed an underwriting risk assessment and modification tool which allows for risk estimation of insurance applicants based on medical disclosures. The Health Underwriting Management System (HUMS) generates risk scores and ratings that can be modified by applying exclusions or loading. An underwriter can use the assessment to evaluate whether the application of exclusions can bring the risk rating to an acceptable range or if the applicant should be denied the policy.
The underwriting tool also provides quick access to medical underwriting guidelines for 120 medical and surgical conditions, which includes clinical summaries and recommendations.
Standardizing underwriting through real-time risk assessment
A stand-alone health insurer in India is using the real-time medical risk assessment tool as part of its underwriting process. The HUMS-driven risk assessment and modification has been fully integrated into its workflow and has standardized underwriting operations.