How does the underwriting process differ for term vs. permanent life insurance?

The underwriting process for permanent life insurance indeed requires more extensive evaluation than that for term life insurance, primarily due to the cash value component included in permanent policies. Permanent life insurance provides not only a death benefit but also a savings element that grows over time, often leading to additional risk factors that underwriters need to consider. These factors include assessing the applicant's overall financial situation, health history, and long-term needs, as the policy is intended to last for the lifetime of the insured.

In contrast, term life insurance is typically simpler and focuses mainly on the risk associated with the insured's health and lifestyle for a specified period. The absence of a cash value component means that the underwriting can be more straightforward, usually based on a limited set of criteria related to mortality risk rather than the more complex financial considerations involved in permanent insurance.

This difference in underwriting complexity is why the choice highlighting the extensive requirements for permanent life insurance is the most accurate in outlining the distinction between the two types of insurance.