What does "underwriting criteria" refer to in insurance?

Underwriting criteria refers to the guidelines and standards used by insurance companies to evaluate the risk associated with insuring a person or an asset. These criteria help insurers determine whether to approve an application for coverage and under what terms and conditions.

When assessing risk levels, underwriters consider various factors, such as the applicant's health history, lifestyle choices, occupation, and other relevant information that could impact the likelihood of a claim being made. By using underwriting criteria, insurers can effectively gauge the potential risk involved with a policyholder, leading to more informed decisions about coverage and pricing.

The other options focus on different aspects of insurance but don't define underwriting criteria accurately. For example, the cost of insurance premiums relates to pricing and not the assessment process for risk, while the benefits included in a policy involve what the insurer will pay in the event of a claim. The process of issuing a policy refers to the administrative steps taken to finalize coverage after underwriting is complete, rather than the criteria used in evaluating the risk itself.