What is the purpose of the 'dual underwriting process' in life insurance?

The dual underwriting process in life insurance is designed to assess both quantitative and qualitative factors. This comprehensive approach is essential because it allows underwriters to evaluate not only measurable data such as age, health history, and lifestyle choices but also subjective aspects like personal habits, family history, and the applicant's overall risk profile. By incorporating both types of factors, insurers can make informed decisions that balance risks with the potential for underwriting profitability.

When looking at why focusing solely on quantitative factors would be insufficient, it becomes clear that a more holistic view of the applicant is necessary for accurately determining risk. Likewise, considering only subjective factors could lead to biased decision-making or misjudgment about an applicant’s true risk level. While automation can help streamline processes, it does not replace the need for a comprehensive evaluation of both quantitative and qualitative data, which is the hallmark of the dual underwriting process.