Insurance FAQ’s: What does “insurance underwriting” mean?

Insurance FAQ’s: What does “insurance underwriting” mean?

Whether you are shopping for home, auto, business or life insurance, underwriting is a key component of the insurance-buying process. But what is underwriting exactly? And how does it effect you and your insurance policy?

When you apply for any insurance policy from an insurance agency, your agent gathers important information from you about your life.

For example, if you are requesting an auto insurance quote, your agent will gather information about your car, where and how far you drive your car, if you’ve had any prior accidents, etc. If you are requesting a home insurance quote, you’ll need to provide information about your roof, your heating system, whether you have a pool, trampoline, pets and more. No matter what type of insurance you are looking for, you will be asked a series of underwriting questions. It is imperative that you answer honestly so that you can be matched with the right insurance company who will be able to cover your risks.

Your answers to these questions will be submitted to the insurance company’s underwriting team.

There are underwriters that specialize in all kinds of insurance. Insurance companies rely on them to evaluate your application (and history), the risks you might present and how to price that risk — which becomes the cost of your insurance. Underwriting used to be a lengthy process. These days, insurance companies rely on predictive analytics in the application process to speed things up.

Essentially, underwriters assess the level of risk associated with insuring a particular individual or entity and then set the appropriate premium to account for that risk. The process helps standardize the insurance market, so two similarly qualified applicants would pay roughly the same amount for coverage.

Underwriting is a crucial step in the insurance process that helps ensure that policyholders are adequately covered while also protecting the financial stability of the insurance company.

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Benefits of an Independent Insurance Agent to Purchase Insurance

Working with an independent insurance agency benefits you. Because we are not tied to one carrier, we are able to compare your current coverage with a wide range of insurance companies to see is the best fit for your unique set of risks. We also have personal relationships with the underwriters we work with, so we are able to guide you through the entire insurance-buying process.

Want Holley Insurance to be your insurance agent? We’d love to help! Call or text 540.334.4225 or start your complimentary quote online here.

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A little more about Holley Insurance…

Holley Insurance was founded in 2000, and retains a core base of loyal clients. We have locations in Roanoke, Rocky Mount, and Forest, VA. As an independent insurance agency, Holley Insurance represents a carefully selected group of financially strong, reputable insurance companies. Therefore, we are able to offer you the best coverage at the most competitive price. If you’re interested in starting a quote online or having us take a look at your current policies, click here.

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