Individual whose insurance policies do not cover all necessary health care services and he or she cannot pay the entire balance due.

Under Medicare Secondary Payer guidelines, this is described as an optional liability insurance available in some regions under which the policyholder’s level of protection against losses caused by another is extended to compensate for inadequate coverage in the other party’s policy.

Third-party payment paid to the provider at less than negotiated contract rate.

Act of a provider withholding necessary medical services because of cost constraints.

Section in an insurance company that chooses the risks that the company will insure and verifies that the mortality and morbidity rates of the company’s insureds do not exceed the rates adopted when premium rates were calculated. This division also negotiates and manages reinsurance agreements. Also called the new business department .

Profit that remains as a surplus of health insurance premium income over claims and administrative expenses.

Factors that may increase an individual’s risk greater than that which is normal for his or her age.

After health insurance premium income, the deficiency that remains after payment of insurance claims and administrative expenses.

Procedure and policy book that summarizes methods used by a specific insurance company to evaluate and rate risks. Underwriters use this as a reference book to research background information on underwriting impairments. It gives suggestions for underwriting actions to take when various impairments are present.

Insurance company’s income from its operations as distinct from its investment earnings.
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The measure of the profitability of an insurer’s underwriting activity. This refers to earned premiums (net of reinsurance) with net operating expenses and claims incurred (net of reinsurance) subtracted. The underwriting profit does not include any investment income.