MIB matters if you’re thinking of buying insurance. Before offering you coverage, insurers want to know about any health issues you may have, problems in your motor vehicle history, your prescription drug use, and more. This lets them decide how much risk it will be to insure you. One of the tools insurers use to research those topics is MIB. For example, when you apply for life insurance, the insurance company might check with MIB to see if you have any health conditions that you did not put on your application. If MIB reports that your application might be missing important details, the insurance company will do more research to make sure that your application is correct.
How MIB Works
MIB is a member-owned organization that collects information and shares it with members. The membership consists of life and health insurance companies, and information in the MIB database comes from members. The concept is similar to a credit bureau that tracks your credit history with lender-provided information. Insurers use MIB for several types of insurance:
LifeHealthDisability incomeCritical illnessLong-term care
When you apply for life or health insurance, insurance companies may ask about your health conditions. They want to know about any issues that increase the risk that they will have to pay benefits. For example, insurers want to know if you have a life-threatening health condition or dangerous hobbies you frequently engage in. If you get insurance through an employer, the coverage doesn’t typically require underwriting. You’re automatically covered. When you apply for individual insurance, though, you usually have to fill out an application and be approved. The information from your application may go to MIB. MIB doesn’t store your actual medical records, such as lab results or prescriptions. Instead, members send codes to MIB. Each code stands for a broad category of medical information that is important for insurance underwriting, most often things that would impact your health and life expectancy. Insurers then compare these codes to your application. When you answer questions on a life insurance application, it’s important to respond accurately and honestly. Insurance companies double-check your answers with any information available to them. MIB is one of the data sources they might use. If MIB reports that your application is missing information about a health condition, for example, the insurance company will investigate further. They may ask you to provide more information until the issue gets cleared up. You will only have an MIB file if you’ve applied for individually underwritten insurance with an MIB member in the last seven years. And if you’re in good health and there are no known risk factors in your history, you might not be in the MIB database. Doctors and hospitals do not provide information directly to MIB. Your insurance company, though, might ask to access medical records from doctors you’ve seen in the past. Those records can be used along with your application and MIB data to arrive at an approval decision.
What It Means for Your Insurance Application
MIB helps insurance companies gather accurate information about new customers. According to MIB, this results in better risk management for insurers, which means lower premiums for customers. And by simplifying the underwriting process, these types of databases make it possible to buy insurance online quickly with no medical exam. This also means that it’s best to be honest when you apply for insurance. Any mismatches can lead to additional paperwork and delays in processing your application. You might not like the thought of your health information in a database. As with credit reporting and other consumer data, you have the right to view your MIB reports and dispute inaccurate information. When it comes to approval and pricing decisions, MIB does not approve or deny coverage. Instead, your insurer uses MIB to detect anything missing in your application. You might have forgotten to include that information or left out important details on purpose. Ultimately, the insurance company is the one that reviews your application and makes the decision.
