Life Insurance Underwriting

Find out more about life insurance underwriting and how it works with Savvy today.

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, updated on July 19th, 2023       

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The idea of life insurance underwriting may be challenging to get your head around, but it's still a vital part of the application and purchasing process. Fortunately, you can learn more about how life insurance underwriting works right here with Savvy.

Find out what types of questions underwriters ask during the life insurance application process and learn about the factors which are important in this process in our informative guide today.

What is life insurance underwriting and how does it work?

Underwriting in life insurance is the process through which insurers determine how much risk an individual presents upon applying for coverage. It helps them decide whether you qualify for life insurance and how much your monthly premium and benefit level will be. Your life insurance application will be underwritten based on the information you provide, with your insurer using the data to assess the risk involved in providing coverage.

Many types of life insurance policies come fully underwritten. Fully underwritten policies require you to answer some questions about your health and lifestyle before you apply, which will determine how much you pay for your coverage.

In some cases, however, you may be able to get a policy that isn’t underwritten. Going down this path means you’re assessed when you or your beneficiary makes a claim on your policy. These policies sometimes may be cheaper, but fully underwritten insurance can provide greater certainty regarding the amount you may receive should you pass away or have to make a claim due to a covered event.

What risk factors are considered in the life insurance underwriting process?

All the details you give on your insurance application go into the underwriting process, where your individual risks are evaluated. Examples of these risks include:

  • Age: your age-related risk factors increase over time, which means your insurance premiums will rise gradually as you get older. For example, you’ll pay more for your insurance if you’re a senior over 60 or 65 rather than someone who is over 30.
  • Overall health: the likelihood of filing a claim for illness, disablement or death can be affected by a variety of medical conditions. Insurers will assess factors such as your medical history (whether you have any current medical conditions or past ones) as well as your weight and blood pressure in some cases.
  • Job: there's a higher chance of dying on the job or becoming disabled or ill in certain fields, such as those where you’re working at great heights, with heavy machinery or hazardous substances. As such, people in these jobs would likely pay more for their coverage or be denied outright if they're seen as too great a risk (such as firefighters).
  • Lifestyle: it's common knowledge that consuming excessive amounts of alcohol, using illicit drugs and smoking cigarettes all pose health risks. If you’re a regular smoker or consume more alcohol than average, you can expect to pay more for your policy.
  • Dangerous hobbies: while most insurance policies will cover your hobbies, some may not cover activities that pose a high risk or charge you a higher premium for cover.
  • Family medical history: some forms of cancer, multiple sclerosis and heart disease have been linked to specific genes, so if you have a family history of certain illnesses, this can increase your risk profile when purchasing insurance.

Does underwriting impact the cost of my insurance?

Yes – life insurance, total and permanent disability (TPD) insurance, trauma insurance and income protection insurance all use underwriting to establish how much you’ll pay for your policy. In some cases, you may be able to be covered at no extra cost, such as if you have a strong risk profile with good health and a low-risk job. However, in other cases, you may be charged a higher premium for your coverage if you have a pre-existing condition or offered a policy with specific exclusions.

How does the process of underwriting work?

Frequently asked life insurance questions

Can I change my life insurance policy at any time if it’s underwritten?

Yes – you can alter your policy at any time, even if it’s underwritten. You may have to go through the underwriting process again if you change the terms of your policy or switch to another insurer, however.

Do I need to have an underwritten policy if I’m a senior?

If you’re a senior over 60 or 65, you may be able to buy a life insurance policy without the need for a medical assessment. However, this will depend on your current health and your insurer’s terms and conditions, among other potential factors. Seniors being approved for coverage without a medical is rare, unless you have no history of illness nad no current conditions.

Are child life insurance policies underwritten?

Yes – in most cases, child life insurance policies are fully underwritten when you apply for cover. Once your child turns 18 or 25, this coverage can transition into an adult policy.

What types of exclusions come with life insurance policies?

Life insurance is intended to alleviate some of the financial burden that may otherwise fall on a family upon the death of a parent (in most cases). If you care about the financial security of your loved ones after your death, it's important to buy a policy that won't leave any gaps if anything goes wrong. Some of the general exclusions on these policies include:

  • Death by suicide within an exclusion period (typically 13 months)
  • Criminal or illegal activity
  • Partaking in sports or risky hobbies, such as scuba diving or rock climbing
  • Incidents that involve drugs or alcohol
  • High-risk travel plans
  • Coverage for a terminal illness diagnosed before your policy purchase

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Compare life insurance policies side-by-side

Through Savvy, you can consider a range of competitive life insurance policies from reputable insurers, whether you're after life, income protection, trauma or TPD cover. Get the ball rolling on comparing your available options today!


Savvy is partnered with Compare Club Australia Pty Ltd (AFS representative number 001279036) of Alternative Media Pty Ltd (AFS License number 486326) to provide readers with a variety of life insurance policies to compare. Savvy earns a commission from Compare Club each time a customer buys a life insurance policy via our website. We don’t arrange for products to be purchased from these brands directly, as all purchases are conducted via Compare Club.

Savvy does not compare all life insurance policies or providers currently operating in the market. Any advice presented above or on other pages is general in nature and doesn’t consider your personal or business objectives, needs or finances. It’s always important to consider whether advice is suitable for you before purchasing an insurance policy.

For any further information on the variety of insurers compared by Compare Club or how their business works, you can read their Financial Services Guide.

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