Editing AI for Insurance Underwriting (section)

== <span style="color: #FFFFFF;">Remembering</span> ==
* '''Underwriting''' — The process of evaluating and pricing insurance risk for a specific applicant or policy.
* '''Actuarial science''' — The mathematical discipline underlying insurance risk assessment; actuaries set rates and reserves.
* '''Premium''' — The amount paid by the policyholder for insurance coverage; must cover expected losses + expenses + profit.
* '''Loss ratio''' — Claims paid / premiums earned; a key insurer profitability metric; target typically 60-70%.
* '''Combined ratio''' — Loss ratio + expense ratio; below 100% = underwriting profit.
* '''Telematics''' — Using vehicle IoT devices or smartphone apps to measure driving behavior for auto insurance pricing.
* '''Usage-Based Insurance (UBI)''' — Auto insurance pricing based on actual driving behavior (miles driven, harsh braking, speed); enabled by telematics + ML.
* '''Property inspection AI''' — Using aerial/satellite imagery + computer vision to assess property condition for homeowner's insurance without in-person inspection.
* '''Underwriting guidelines''' — Rules governing which risks an insurer will accept and at what terms; ML can automate application.
* '''Mortality model''' — Statistical model predicting life expectancy; core of life insurance underwriting.
* '''Morbidity model''' — Statistical model predicting illness occurrence; core of health insurance underwriting.
* '''Catastrophe (CAT) model''' — Simulation models estimating losses from natural disasters; used for reinsurance pricing.
* '''Anti-selection''' — High-risk individuals are more likely to purchase insurance; ML helps identify and price for this.
* '''Reinsurance''' — Insurance for insurance companies; ML improves reinsurance risk assessment.
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