General Insurance✓ Verified · outline & fact-checked · Sep 2026Difficulty 1/5
The underwriting department's primary role in an A&H insurer is to:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Underwriting exists to select and accept risks that match the assumptions used in setting premiums. If the accepted risks are worse than assumed, claims exceed expectations and pricing fails; if better, the insurer overcharges and loses market share. Accurate risk selection is therefore the core function that keeps an insurer's book of business balanced.
Why the other options are wrong
- B) Marketing is the distribution function performed by the sales and agency departments.
- C) Claim payment is handled by the claims department, not underwriting.
- D) Policy form filings are a legal and compliance function, separate from risk selection.
Memory hook
Underwriting = admitting only the risks the price was built for.