Underwriting guidelines: Pursuits & pastimes

According to the World Health Organisation, physical activity is any bodily movement produced by skeletal muscles that requires energy expenditure. Examples of this can include activities such as sporting and leisure (e.g. swimming), incidental (e.g. at work), and muscle-strengthening (e.g. resistance-band training).

Recent Australian Institute of Health and Welfare data* states that 55% of adults don’t participate in sufficient physical activity. And, the rate of insufficient physical activity generally increases with increasing age.

When it comes to your overall health and wellbeing, participating in regular physical activity and limiting sedentary time^—coupled with a healthy diet^#—can have significant benefits, such as:

• maintaining energy levels
• decreasing the risk of mortality
• improving mood and memory function
• preventing or managing mental health problems, such as depression, anxiety and stress
• preventing or improving health risk factors and chronic diseases, such as hypertension, high blood cholesterol, type 2 diabetes, osteoporosis, cardiovascular disease, obesity and some cancers.

Insurance underwriting guidelines: Pursuits & pastimes

From a physical activity and personal insurance perspective, it’s important to note that many social pursuits and pastimes are often accepted by insurers at standard rates* in a formal insurance application.

*In addition, some insurers may also provide discounts on insurance premiums for those that take an ongoing proactive approach to their health and wellbeing, inclusive of participating in regular physical activity.

However, some pursuits and pastimes can be considered riskier by an insurer. Subsequently, an insurer’s underwriter may decide to either decline insurance cover or issue revised terms (e.g. loading or exclusion).

This decision can often come down to the inherent risks in a pursuit or pastime, and whether it’s participated in from an amateur or professional perspective—coupled with the type of insurance cover being applied for.

Please see below for a general overview of how an insurer’s underwriter may consider certain pursuits and pastimes when reviewing an individual’s formal insurance application.

Please note: The general overview is based on the underwriting guidelines of several insurers. However, each insurer has its own specific underwriting guidelines. Therefore, this general overview is neither representative of all insurers, nor of an existing insurance arrangement that you may have with an insurer.

With this in mind, for simplicity, the term ‘attention’ has been used in instances where standard rates may not be offered on a pursuit or pastime. In this context, the term ‘attention’ may refer to either a decline on insurance cover, an issuance of revised terms, or an issuance of standard rates at the insurer’s discretion.

Considering the above, it’s also important to understand the potential impact that other relevant information—individually and collectively—can have when an insurer’s underwriter is reviewing a formal insurance application.

Therefore, completing a pre-assessment can be a vital consideration—particularly if you have a hazardous occupation, pursuit or pastime, or a pre-existing medical condition or a family history of a medical condition.

As previously covered in our recent animation, ‘Personal insurance pre-assessments’, a pre-assessment is an informal way of finding out how insurers may view your formal insurance application.

And, while the results aren’t a guarantee of the terms that will be offered upon completing a formal insurance application, they can provide a strong indication of the potential outcomes. This can be beneficial when:

• making informed decisions on which insurer (and their offering) may be appropriate to you
• managing expectations around potential outcomes of a formal insurance application.

After reading this article, you may find the following of interest:

• Personal insurance pre-assessments
• Personal insurances and managing risk
• Ageing and health status in retirement
• Physical activity and dietary guidelines
• Workplace health and wellness programs
• Prevalence, incidence, risk and cost burden of ill health

If you have any questions regarding this article, please contact us.

*Australian Government, Australian Institute of Health and Welfare. (2020). Insufficient physical activity.

^Australian Government, Australian Institute of Health and Welfare. (2018). Physical activity across the life stages.

#Australian Government, National Health and Medical Research Council. (2013). Australian dietary guidelines.

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