Which describes what is determined by the insurer's staff review of applications from prospective insureds?

• A. Whether the characteristics of the customer match the insurer's eligibility and selection guidelines.
• B. Whether the customer will file frequent claims.
• C. Whether the customer has completed the application form.
• D. Whether the customer has previous insurance experience.

Answer: (A)

Underwriting evaluates whether an applicant fits the insurer’s risk criteria. The staff review of applications focuses on whether the applicant’s characteristics—such as age, health, occupation, and lifestyle—meet the insurer’s eligibility and selection guidelines. If they align, the insurer can approve coverage and assign the appropriate rating and policy features; if not, coverage may be denied or modified. This process centers on insurability and risk acceptance, rather than simply whether the form is completed, whether the applicant has prior insurance, or how often they’ve filed claims. Past information can inform the decision, but the key point is alignment with underwriting guidelines.