Which of the following terms refers to the process of determining if an insurance policy is valid?

Underwriting is the process of determining if an insurance policy is valid and assessing the risks involved in insuring an individual or entity. During underwriting, the insurer examines various factors, such as the applicant's health information, financial stability, and the specifics of the coverage requested. This thorough evaluation helps the insurance company decide whether to accept the risk and issue the policy on the terms proposed.

This process is vital, as it not only helps to ensure that the premiums charged are commensurate with the level of risk the insurer is undertaking, but it also protects the insurer from potential fraud and excessive claims. By properly underwriting each application, insurers can maintain financial stability and operate effectively within the insurance market.

In contrast, the other terms relate to different aspects of the insurance field but do not specifically denote the validation of an insurance policy. For instance, assessment and evaluation might refer generally to analyzing risks or claims but do not encapsulate the underwriting process. Qualifying typically refers to determining eligibility for coverage rather than validating a policy’s existence.