insurance

Medical Examination (Insurance)

A health assessment required by insurance companies before issuing certain policies, typically involving a physical exam, medical history review, and sometimes laboratory tests. The examination helps insurers assess risk and determine appropriate premiums or coverage eligibility.

Example

“The insurance company required a medical examination including blood work and an EKG before approving the $500,000 life insurance policy for the 55-year-old applicant.”

Memory Tip

Medical Exam = Measuring Everyone's Danger - insurers check your health to measure risk.

Why It Matters

Medical examinations help ensure fair pricing by matching premiums to actual health risks, preventing adverse selection where only unhealthy people buy insurance. They also protect healthy applicants from subsidizing higher-risk individuals through accurate risk assessment.

Common Misconception

Many applicants believe they can hide health conditions during medical exams or that minor issues will automatically disqualify them from coverage. In reality, insurers often accommodate health conditions with adjusted rates rather than denial, and they have access to medical databases that make concealment difficult and potentially fraudulent.

In Practice

Lisa applies for $300,000 life insurance at age 45. The required medical exam reveals controlled diabetes and slightly elevated cholesterol. Instead of denial, the insurer offers coverage at 25% higher premium ($180 monthly instead of standard $145). Her exam costs are covered by the insurer, and the process takes 2 weeks. Without the exam, she might have faced investigation and possible claim denial later if health conditions weren't disclosed.

Etymology

Combines 'medical' from Latin 'medicus' (physician) and 'examination' from Latin 'examinare' (to weigh or test). Insurance medical exams became standard practice in the late 1800s as life insurance companies sought to assess applicant health risks.

Common Misspellings

medical examonationmedical examination insurencemedial examinationmedical examinaton

Related Terms

underwriting

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