Self-selection
Definition of "Self-selection"
Effort of a poor risk to seek insurance coverage. The onset of a health problem such as heart disease, for example, may prompt a person to apply for life insurance before seeking medical treatment. Such applicants, if not screened out, would weight the insured pool toward bad risks. The underwriting process is intended to counter the natural tendency toward self-selection among insurance applicants, either by requiring higher rates for poorer risks or by denying them coverage.
Popular Insurance Terms
Several insurance companies under common ownership and, often, common management. ...
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Use of a home, and the land and buildings surrounding that home, free from the claim of creditors. This right gives rise to an insurable interest. ...
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