You have two international health insurance quotes in front of you and one is clearly cheaper. Before you sign, check the underwriting basis. It decides how your medical history is treated, and at claim time it matters as much as the premium.
What Underwriting Actually Decides
Underwriting is the insurer’s assessment of your medical history before cover starts. It determines which conditions are covered, which are excluded, and on what terms. Two policies with identical benefit tables can behave very differently when you claim, because they were underwritten differently.
The Three Main Underwriting Bases
Full Medical Underwriting (FMU)
The rule: you declare your complete medical history when you apply. The insurer reviews it and tells you upfront how each condition is treated: covered, excluded, or covered with an extra premium.
The benefit: certainty. You know before you buy exactly where you stand.
The trade-off: more paperwork at application, and anything you forget to disclose can cause problems later. If a condition was not declared, the insurer may reduce or reject a related claim, depending on the policy terms.
Moratorium
The rule: no medical questionnaire at all. Instead, conditions you had in a look-back period, commonly the last five years, are automatically excluded from cover.
The interesting part: those exclusions are usually not permanent. After a continuous trouble-free period in cover, commonly two years, a condition can come back into cover.
The catch: “trouble-free” typically means no symptoms, no treatment, no medication and no medical advice for that condition during the whole period.
The trade-off: less paperwork now, more ambiguity at claim time, because whether something counts as pre-existing is assessed when you claim, not when you apply.
Medical History Disregarded (MHD)
The rule: found in larger group schemes, not individual policies. Employees join without any individual underwriting and pre-existing conditions are covered.
The catch: the plan belongs to the employer, not to you. When you leave the job, the cover ends, and any condition you developed while on the scheme becomes pre-existing history for the next insurer, unless a continuation option was designed in from the start.
A Worked Example
Say you had a knee operation two years ago, and the same $8,000 keyhole procedure becomes necessary again.
- Under FMU: you declared the operation, and the insurer’s decision is already in writing. If knee conditions were excluded, the claim pays $0 and you knew that from day one. If they were accepted, the claim can be paid, subject to policy terms.
- Under moratorium: the knee was automatically excluded at the start. If you have since had two full years in cover with no symptoms, treatment or advice for it, it may be back in cover. If you saw a physio last year, the clock restarted, and the claim may be declined.
- Under MHD: covered while you are employed. If you left the company last month, it is now a pre-existing condition on whatever you buy next.
Switching Insurers: The Part Most People Miss
A new insurer means new underwriting, at your current age, with your current medical history. A condition that developed while you held the old policy is pre-existing to the new one. This is why a cheaper renewal quote is not automatically a saving: the premium drops, but a condition that was covered may no longer be.
Some insurers can take over your existing terms instead, often called continuation terms or CPME (continued personal medical exclusions). Your old policy’s exclusions carry across as they are, with no fresh underwriting, subject to the new insurer’s acceptance. If you are switching to save premium, this is the option to ask about before anything else.
💡 Pro Tip: Keep a copy of your original application, your policy schedule and any exclusion letters. At claim time, and at switching time, these documents decide the conversation.
💡 Action Step: Worth 15 minutes: find your policy schedule and check which underwriting basis it names, and whether any personal exclusions are listed. Most people have never looked.
Should You Choose FMU or Moratorium?
- Choose FMU if: you want certainty in writing, your history has anything complex in it, or you never want to debate what “pre-existing” means at claim time.
- Choose moratorium if: your recent history is clean, you value a fast application, and you understand the reinstatement rules.
- If you have MHD through work: enjoy it, and plan your own portable layer alongside it. Our guide to what IPMI is and who needs it explains why an unbroken insured history is worth protecting.
How IPG Can Help
We look at the underwriting basis before we look at the premium. Whatever policy you hold today, and whoever it is with, we can review your current terms and tell you exactly where you stand. When it is time to buy or switch, we compare options across the insurers we represent and our wider partner network, so the recommendation fits your medical history, not just your budget. Talk it through with us before you commit.
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Final coverage always depends on the insurer’s terms, exclusions and underwriting.