West Virginia State Life Insurance Practice Exam

What is the purpose of the Medical Information Bureau (MIB) in relation to insurance?

1. Provide government statistics

2. Maintain medical records for patients

3. Assist underwriters in assessing risk

4. Process insurance claims

The correct answer is: Assist underwriters in assessing risk

The purpose of the Medical Information Bureau (MIB) in relation to insurance is to assist underwriters in assessing risk. The MIB maintains a database that compiles information about applicants’ medical history and insurance claims. This information helps insurers evaluate the risk associated with providing coverage to an individual. By accessing MIB data, underwriters can make more informed decisions regarding underwriting policies, determining premiums, and identifying instances of potential fraud. This role is crucial in the insurance process because it helps insurers gauge the health and medical risks that could affect policy performance and profitability. The accuracy of underwriting decisions depends significantly on the information provided by applicants and the insights gained from the MIB. In contrast, providing government statistics, maintaining medical records for patients, and processing insurance claims do not align with the primary function of the MIB, which focuses specifically on aiding insurers in risk assessment and underwriting processes.