Underwriting is the process that insurance companies use to determine the eligibility of new applicants applying for medical insurance. Although the guidelines can vary by state, as well as from one insurance company to another, there are common methods used in this process. Any person applying for individual health insurance must complete a lengthy application, full of questions pertaining to your current and past health history. They will require you to list your last doctor; visits, any prescription medications you have recently been prescribed, as well as specific questions pertaining to certain medical conditions or illnesses that are considered to be high risk toward future claims. Any medical condition disclosed on the application is viewed by the insurance carrier as a "pre-existing" medical condition. The short and long term risks associated with this condition are then assessed to determine if the insurance company considers the risk of insuring you too high in relation to the premium that they will be collecting from you each month.

Many medical conditions, both current and recent, are typical causes for immediate denial of acceptance. This includes a history of cancer, AIDS, heart disease, obesity, severe depression, Diabetes (Type 1), pending surgical procedures, and much more. In fact, you might be surprised at the how comprehensive the list of declinable conditions are. If you have concerns about your eligibility due to a pre-existing medical condition, you should contact the insurance carrier or an insurance agent before you take the time required to submit an application for coverage. If your condition is not an automatic decline, the insurance company, or agent, will advise you to apply for coverage in order to have the insurance company do a more comprehensive review of your eligibility status.

The insurance company may request medical records from your physician in order to get more detailed facts pertaining to your medical history. This process can dramatically slow down the approval process, taken several weeks to complete. Based upon review of the medical records, the insurance company will render a decision as to your "insurability", or counter-offer at a higher premium amount, known as a "rate-up." They may also offer you coverage under the agreement that certain pre-existing medical conditions will be excluded from your benefits for a specific period of time. This is known as an "exclusion rider" and is commonly offered for less concerning medical conditions, such as allergies.

With such strict underwriting guidelines, many people are inclined to not disclose certain things on their application for health insurance. This is not a good idea. The application for insurance is a legally binding contract and you sign a statement of fact that you have answered all questions honestly. Failure to disclose pertinent information to the insurance companies could results in future recession of your coverage, along with the legal obligation to pay back all medical bills paid on your behalf by the insurance company.

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