How Does Group Underwriting Work In Health Insurance? 
You should only be dealing with group underwriting if your group has more than 50 employees or you are considering a self-funded group health plan . The employees in your group will have to complete an application form and answer a variety of medical questions regarding various health conditions and prescription drug usage . These forms are then submitted for underwriting where an underwriter takes into consideration what health conditions exist in the group -LRB- diabetes , cancer , pregnancies , expensive maintenance drugs , etc. -RRB- and then makes a determination if the originally quoted rates for your group will generate enough premium to cover the average expected risk plus the now disclosed risks in your group . For example , if based on the census of your group the male to female ratio and average age in the group indicated a need for $ 20,000 per month in premium to cover the expected risk and overhead associated with your group you would start out with an proposal costing $ 240,000 annually . It is assumed there will be a certain average amount of health care consumption in your group based solely on the factors I 've described above . If , however , your group has risks in it that go beyond what is standardly assumed should exist -LRB- you have a large number of diabetics or some pregnancies in the pipleline or an ongoing cancer case for examples -RRB- then the underwriter will `` adjust '' the originally quoted rates to reflect the need for more premium to cover these higher than anticipated medical expenses . So , if the underwriter determines that your group is more likely to cost $ 300,000 in medical expenses and overhead rather than $ 220,000 as originally quoted , the underwriter will return a `` counter offer '' with a 36 % rate adjustment -LRB- $ 300K / $ 220K -RRB- to accept your group at its real risk level . 