Section G!

Individual Underwriting by an Insurer

Seated on the couch are 12 of the 13 people in the room, assuming you consider Baymax to be a person. But I'm not here for debates of that nature. That would take a long time and as interesting as that would be, this is a story about insurance, not philosophy or biology.

FRED: So we're all in agreement?

TADASHI: Yes. I think so.

HICCUP: This sounds like a difficult thing to wrangle in a fanfiction.

ADDIE: I'm sure we can manage.

OVERLORD KATIE: Who wants to ask the question?

ADDIE: Since it pertains to me, I'll ask. Hey gust! What's your theory about my physical pain?

ERICK: Come on, you can totally tell us!

HICCUP: And Acia, is your username pronounced Ay-sha or A-see-ah?

OVERLORD KATIE: That question has been plaguing me forever.

FINN: Thanks for reviewing, Joan McCreedy!

HICCUP: And I'm sure there is a form of dragon insurance.

GOGO: Wow. You're not even trying anymore, are you?

OVERLORD KATIE: Nope.

BAYMAX: Perhaps we should start talking about insurance now.

OVERLORD KATIE: Let's do it!

BAYMAX: The functions of an underwriter are to determine the selection, classification of risk, and the degree or rate of insurance for an applicant.

TADASHI: So put simply, an underwriter has to figure out what applicants to insure, the kinds of risks, and the rate of said insurance?

BAYMAX: Correct. The completion of an accurate and thorough application by the producer (agent) is absolutely imperative to an insurance company.

GOGO: I bet it is. You have to be thorough and accurate.

BAYMAX: Yes you do. An application must be signed by an agent and an applicant. The policyowner must sign if the person is different than an applicant. An application can be a primary source for underwriting if an applicant's medical background is flawless.

OVERLORD KATIE: I should read and reread that a few times.

BAYMAX: Yes you should. Even more importantly, you're going to have to memorize these next 3 parts.

SAM: Oh boy!

HONEY: Who is Sam?

FRED: Quantum Leap reference.

TADASHI: Seriously, Overlord Katie? No one is going to get that reference. Let it go.

OVERLORD KATIE: It was a really good show, okay? It's given me a lot of inspiration for future stories!

ADDIE: You mean just the next one because that's the last one you've fully planned out.

OVERLORD KATIE: Same difference.

FRED: Besides, that show's old. Wasn't it still on when you were born?

OVERLORD KATIE: So is Doctor Who and Star Trek and people talk about them.

GOGO: Why are we talking about this now?

TADASHI: Good point. We should definitely move on.

BAYMAX: Excellent. The application consists of three parts. Part 1 includes general questions about an applicant: name, address, age, date of birth, gender, income, credit rating, marital status, occupation, the type of coverage desired, other insurance coverage, applications, and information regarding the beneficiary.

OVERLORD KATIE: Does someone want to fill one out so we can remember it easier?

FRED: Let's fill it out about you! So name would be Katie Ped-

OVERLORD KATIE: Oy, real names are forbidden!

FRED: -destrian.

OVERLORD KATIE: Katie Pedestrian?

FRED: Well I had to come up with something. Address... um Maryland?

OVERLORD KATIE: Good.

FRED: Age 25, birth date is 9/9/1990. Gender is female. Income is not enough. Credit rating is not applicable. Marital status is forever alone. Occupation is writer. Type of coverage desired is independence from parents' health insurance. And the other stuff doesn't really need answers here, I guess.

OVERLORD KATIE: I am pleased with the utter lack of real information.

FRED: Don't mention it.

BAYMAX: Part 2 includes the Medical information: height, weight, tobacco, alcohol consumption, present and past medical background, medical status of living relatives, causes of death of deceased relatives. An insured's Medical history may be reviewed and reported to apply for an insurance policy.

HICCUP: Let's fill that out too. So your height is 5'3. Weight is unavailable. Nonsmoker. Gave up drinking when you discovered that you're not a happy drunk.

OVERLORD KATIE: I've never been drunk.

HICCUP: Excuse me. Gave up drinking when you discovered that it made you nauseous and antisocial, even when mildly buzzed. Better?

OVERLORD KATIE: Much.

HICCUP: Present and past medical background... would double eye surgery count? And ADD?

OVERLORD KATIE: Probably.

HICCUP: Medical status... umm not currently dying of anything? Medical status of living relatives is also not currently dying of anything.

OVERLORD KATIE: My mom was in the hospital recently.

HICCUP: And has been given a clean bill of health since.

OVERLORD KATIE: True.

HICCUP: Causes of death of deceased relatives.

OVERLORD KATIE: Natural causes. And leukemia in one case. We Pedestrians are a hardy bunch.

HICCUP: Better than having your dad either plasma blasted to death or crushed by a tunnel.

OVERLORD KATIE: Quite.

BAYMAX: Part 3 is the Agent's Report that is completed by the producer to provide personal observations concerning the proposed insured. It also contains a client's estimated net worth and reasons a contract should not be issued to an applicant. The Agent's Report does not become part of an entire contract, however it is part of an application's process. The report also states whether or not it is a Replacement Policy.

ADDIE: So... personal observations about Katie Pedestrian.

HIRO: Stupid sense of humor.

HONEY: Multishipper.

FRED: Gives me amazingly hilarious lines.

CLIFF: Me too!

HICCUP: Likes to make me cry.

ASTRID: Likes to make me comfort him.

FINN: Likes to make me suffer.

ADDIE: Likes to make me suffer.

ERICK: Likes to make me LOSE LIMBS.

OVERLORD EMILY: DRIVES ME CRAZY!

OVERLORD KATIE: You stay out of this.

ERICK: So basically we're observing that she's a sadist.

OVERLORD AMANDA: Oh please, you want sadism? I'll give you sadism.

An asteroid suddenly slams into the house, which bursts into flames. Everyone is killed.

OVERLORD KATIE: NOW LOOK WHAT YOU'VE DONE, HOW AM I SUPPOSED TO STUDY INSURANCE WHEN YOU KILLED MY ENTIRE STUDY GROUP?

OVERLORD AMANDA: I WAS PROTECTING YOUR REPUTATION BY SHOWING I'M MORE SADISTIC THAN YOU!

OVERLORD EMILY: Weeps for the death of the twins, Cliff, and Erick.

OVERLORD KATIE: I understand that you were trying to restore my honor and I'm pleased for the gesture but please bring them back.

OVERLORD AMANDA: Ugh fine.

The asteroid flies back into the sky and the house repairs itself. Everyone comes back to life.

TADASHI: Did it just get a little warmer in here?

FRED: You can turn off the space heater.

CLIFF: But the space heater isn't on.

BAYMAX: Let us continue our talk about insurance. An Attending Physicians Statement is the primary sourced used by underwriters to evaluate an applicant's past Medical details, diagnoses, treatments, and recovery time.

TADASHI: And the application if the medical history is flawless?

BAYMAX: Correct. The Medical Information Bureau (MIB) is a Nonprofit organization formed and funded by insurers and it contains coded Medical information reported by its members as an underwriting source. It is primarily used to gain additional information during an underwriting process. An applicant cannot be denied coverage because of information found in it.

HICCUP: Simplified, the MIB is an organization that has coded medical information as underwriting sources used to gain information.

BAYMAX: Yes. An examination of an applicant for insurance is conducted by a physician or by a paramedic at the insurer's expense.

HIRO: So they have to get a physical. Not fun.

BAYMAX: An applicant completes an HIV consent form which provides an insurer with the authorization to test for the presence of an HIV Virus.

ERICK: Ehh, blood draws aren't that bad.

ADDIE: You hated needles until you lost your foot. Then suddenly no other pain was all that bad.

OVERLORD KATIE: Ha, I hated them until I had surgery on my toe. No needles could possibly be more painful than those. None. Now blood draws are no big deal.

ADDIE: So the moral of the story is to go through horrific pain and then needles won't be a big deal.

ERICK: Pretty much, yeah.

ADDIE: I can't wait for these next few stories.

BAYMAX: Underwriting for HIV or AIDS is permitted as long as it's not unfairly discriminatory.

WASABI: So... no discrimination based on HIV or AIDS?

BAYMAX: Essentially. Insurance companies MUST maintain strict confidentiality regarding HIV tests or the diagnosis. The test results may not be provided to the MIB if an individual is identified. The MIB can help an insurer compare information given in an application with previous insurance applications by the same applicant but for different companies.

TADASHI: So that means that those results should be kept confidential when submitted to the MIB and they can help insurers compare information for other applications.

BAYMAX: That is simplified but correct. It is unlawful to discriminate against victims of domestic violence with regard to insurance underwriting, pricing, renewal, scope of coverage, or payment of claims.

A certain person in this room starts to look very uncomfortable.

BAYMAX: An insurance company may never request a person or blood relative or an applicant to provide genetic information, take a genetic test for underwriting or any other reason.

WASABI: So applicants can't be discriminated against based on genetic predispositions.

BAYMAX: Yes. Preferred Risks are reduced risks of loss and, as a result, are covered at a reduced, discounted rate.

GOGO: Like a nonsmoker.

BAYMAX: Yes. Standard Risks reflect the average exposure to a loss or claim. The applicants represent an age group with similar lifestyles. The premiums are not elevated in the Preferred and Standard Risks.

HONEY: So normal people with normal risks are standard.

BAYMAX: Essentially. Substandard Risks refers to smokers, those with poor health, or have dangerous occupations or hobbies. They pay a higher rated-up premium and are often considered to be a special risk classification.

HIRO: So more risky people. Like those willing to run into a burning building to save a supervillain.

TADASHI: In my defense... actually no. There was no reason for me to do anything that dumb.

HIRO: Thank you.

Erick looks morose and Adrianna squeezes his hand.

BAYMAX: Finally, Declined Risks are those which an underwriter believes present too high of a risk and are not insurable.

GOGO: Like someone with an extreme mental illness?

BAYMAX: Correct. There is one more quick section of chapter 2. Would you like me to continue to finish out the chapter?

OVERLORD KATIE: Please.

BAYMAX: Very well. This section is on Considerations in Replacing Health Insurance. One of the primary considerations when replacing a Health Insurance policy is a pre-existing condition. Pre-existing conditions are health or-

ASTRID: Stuff you had 6-12 months before the policy is issued, I remember.

BAYMAX: Correct. It is nice to see you all remembering your vocabulary words. Pre-existing conditions for replacing a Health policy are subject to a probationary period or waiting period generally 15-30 days after the issue date of their policy. During this period, sicknesses will not be covered but accidental injuries would be covered from the issue date of the policy.

TADASHI: So pre-existing conditions require a probationary period before being covered.

BAYMAX: Yes. A producer must be extremely careful in a replacement situation to compare benefits, limitations, and exclusions found in both the replacement policy and the current policy.

HICCUP: So basically they have to compare the information between policies.

BAYMAX: Correct. The most important considerations in replacing Health Insurance are the exclusions or limitations in the new policy.

TADASHI: Look at the exclusions and limitations then.

BAYMAX: It is a good idea. When a replacement policy is involved, the producer must replace the policy in the best interest of the customer. After being evaluated by an underwriter where premium and risk are exchanged, an insured (client) may not pay the same premium or receive the same benefits they had before their replacement.

HICCUP: Wait, stop, clarification. So the producer has to give the customer the best replacement policy and they can't have the same premium or benefits as the one before.

BAYMAX: Correct. It is important not to cancel an old policy until the underwriting of the replacement policy has been completed. Underwriting is very important because the replacement policy will not contain the same factors ass the old policy.

HIRO: Cool. So don't cancel the old policy until the underwriting is finished on the replacement.

FINN: Can we be done?

OVERLORD KATIE: Yes. This concludes chapter 2.

I need a nap and a shower now. And then I'll be back to write more!

~KateMarie999