In an insurance context, what does 'underwriting' refer to?

Underwriting in the insurance context refers to the process of determining which insurance risks to insure. This process involves evaluating various factors related to the applicant, including their health, financial stability, previous claims history, and other risk elements. The goal of underwriting is to assess the likelihood of a claim being filed and to decide whether to accept that risk under a specific policy and at what premium.

Correct underwriting not only helps insurance companies protect themselves financially but also ensures that policyholders receive appropriate coverage based on their individual risk profiles. By accurately assessing risks, insurers can maintain a balanced portfolio and ensure that they are operating sustainably within the market.

The focus of other options lies outside the scope of underwriting. For example, assessing damages after a claim is filed pertains to claims handling and management, while negotiating settlement offers relates to the resolution of a claim. Appealing denied claims is a process that occurs after the underwriting phase and involves challenges to decisions made on claims.