How Underwriting Works

Underwriting is how insurers assess your risk and determine your premiums. Understanding what they evaluate — and what you can control — is the difference between overpaying and getting the best rate.

Credit-Based Insurance Scores

Credit-based insurance scores are NOT the same as your regular credit score (FICO). They're proprietary models designed to predict the likelihood of future insurance CLAIMS, not loan defaults. Studies show strong correlation between credit history and claims frequency. However, insurers cannot use t

Life Insurance Underwriting Classes

Life insurance underwriting classifies you into risk tiers that determine your premium. The difference between Preferred Plus and Standard can be 2-3x in premium cost. Preferred Plus/Super Preferred: Excellent health, no tobacco, ideal BMI, no family history of early death, clean driving record. Bes

CLUE Reports & MIB

CLUE (Comprehensive Loss Underwriting Exchange): Database of your prior insurance claims for the past 7 years. Every claim you've filed — auto, home, renters — is reported here. Insurers check CLUE before issuing a policy. You can request your free CLUE report annually at LexisNexis.com. Review it f

Health Insurance Risk Scores (HHS-HCC)

The HHS-HCC (Hierarchical Condition Category) model is used in the ACA marketplace for risk adjustment — transferring money from insurers with healthier enrollees to those with sicker ones. Each diagnosis is assigned a risk score. A healthy 40-year-old might have a risk score of 1.0. A diabetic with