Massachusetts Health & Accident Insurance Practice Exam

Which of the following is NOT a consideration for underwriting group insurance?

1. Size and composition of the group

2. Prior claims experience

3. Individual member's credit score

4. Stability of the group

The correct answer is: Individual member's credit score

In the context of underwriting group insurance, one of the key factors is that it evaluates the group as a whole rather than focusing on individual members. This approach contrasts sharply with individual insurance, where personal characteristics, including credit scores, are critical in assessing risk. The size and composition of the group is important because larger and more diverse groups typically exhibit more stable risk patterns. By examining prior claims experience, underwriters can understand the group's overall health and potential future claims, while assessing the stability of the group helps predict whether it will remain intact over time, which impacts long-term risk and premiums. However, the individual member's credit score is not a relevant consideration in the underwriting process for group insurance. Group underwriting is based on the collective characteristics of the group rather than the financial histories of individual members, making it the correct answer to identify as a factor that is NOT considered in this context.