Private Medical Insurance (Part 2): Understanding the Different Types of Underwriting Terms

When managing your private medical insurance (PMI), one of the most important elements to understand is underwriting. Underwriting determines whether a claim will be approved within the scope of what your policy covers, as outlined by the insurer’s general exclusion list. When joining a policy, there are usually several types of underwriting to choose from, and each insurer may word them differently. That’s why it’s essential to understand both the options available and the exact terms your insurer uses.

In this article we will discuss the five main types of underwriting used in group schemes:

• Moratorium (MORI)

• Continued Moratorium (CMORI

  
  

• Full Medical Underwriting (FMU)

• Continued Medical Exclusions (CME)

  
  

• Medical History Disregarded (MHD)

  
  

Each of these works differently, and the type of underwriting in place can make a big difference in whether a claim will be approved. Understanding how they compare can really help when you’re reviewing your current policy, thinking about switching providers, or exploring new options for your team.

1. Moratorium and Continued Moratorium Underwriting

Moratorium (MORI)

Moratorium underwriting is one of the most common choices for individuals, families, and SME group schemes when setting up a policy. Under this underwriting type, no medical history is required when initially joining the scheme. However, if a claim is made, the insurer may request access to your medical records to assess eligibility.

With Moratorium underwriting, exclusions may apply to any conditions you’ve had in the five years prior to joining the policy, as well as any related conditions. These exclusions are commonly assessed using what is often referred to as a "5-2-2" approach:

• 5 years: Anything for which you have received treatment, medication, advice, or experienced symptoms in the 5 years prior to joining the policy will be initially excluded, and anything related to these will also be initially excluded.

  
  

• 2 years + 2 years: These exclusions may become eligible for cover after you’ve been on the policy for two years and have also been symptom-free and treatment-free (including medication and advice) for two continuous years from the policy start date.

Additional Moratorium Clauses:

• New and Unrelated Conditions: These are typically covered from the start date of the policy for all eligible claims.

  
  

• Conditions Over 5 Years: Conditions that occurred more than five years before joining — and that haven’t required treatment, medication, or advice, and that you have not experienced symptoms for during the five years leading up to your policy start date — are generally covered from day one for eligible claims.

Note: The above is a general example of moratorium underwriting provided for illustrative purposes only. Insurers may define moratorium terms differently, and exact terms can vary between providers. Always refer to your policy documents or seek clarification before making any decisions.

Disclaimer: This information is provided for general guidance and should not be relied upon in place of your own policy underwriting terms. For full and up-to-date details, please refer to your insurer, policy documentation, or a regulated adviser such as a broker.

Continued Moratorium (CMORI)

If you’ve chosen moratorium underwriting and decide to switch providers while maintaining your existing terms (you can check out our article on Switching Providers and Maintaining Your Underwriting for more on that), your new insurer will usually apply what's called Continued Moratorium, or CMORI.

This means the new insurer picks up from your original moratorium start date—as long as there haven’t been any gaps in your cover—so you don’t have to start the clock again. That said, it’s worth noting that each insurer may have different rules around how their moratorium works. When you switch, you’re agreeing to the new insurer’s version of those terms, so it’s really important to check the details carefully before changing providers.

This process assumes the new insurer's switch criteria is met. If not, the new insurer may apply new or additional exclusions depending on their assessment. For more information on this, speak with a regulated broker. A regulated broker should be able to help you understand your options and any criteria that must be met to protect your original underwriting terms when changing providers.

2. Full Medical Underwriting (FMU) and Continued Medical Exclusions (CME)

   
   

Full Medical Underwriting (FMU)

This approach requires each member to complete a medical questionnaire before joining the policy, which is then reviewed by the insurer’s medical assessment team. Based on this assessment, the insurer will issue personalised underwriting terms for each member, outlining any special conditions or exclusions that apply as a result of their FMU form. Please note that the insurer may still request access to your medical records if you make a claim—particularly within the first 12 to 24 months—to confirm that the FMU form was completed accurately and that the claim is eligible for cover.

Note: If there are any special conditions or exclusions applied, the member might be able to review them with the insurer over time—often after two or five years—depending on the insurer’s terms. If your health situation changes, it’s possible that an exclusion could be reconsidered and removed. If you think an exclusion might no longer be relevant, it’s worth checking in with your broker or insurer to see if a review is an option.

Continued Medical Exclusions (CME)

Continued Medical Exclusions (CME) apply when you switch insurers from a Full Medical Underwriting policy, while protecting your original underwriting terms. In this case, your existing exclusions may carry over to the new insurer. This ensures continuity and means that previously excluded conditions remain excluded, without adding new exclusions to anyone’s Certificate of Insurance.

However, it's important to note that while no new exclusions are added to anyone’s Certificate of Insurance, you are still subject to the insurer's general exclusion list, which can vary between providers. Therefore, it is always important to compare general exclusion lists and ensure you are satisfied before changing providers. For more information on General Exclusion lists, please refer to Part 1 of this three-part series, which can be found on the blog page of the website.

Note: The process of switching from FMU to CME assumes underwriting terms are protected and the new insurer's switch criteria is met. If not, the new insurer may apply additional exclusions depending on their assessment.

This type of underwriting is not always called CME and may also be known as:

• Continued Personal Medical Exclusions (CPME)

• Switch

• No Further Underwriting

  
  

Different insurers may use slightly different terms, but they usually mean the same thing. If you’re unsure about your specific policy, it’s a good idea to check directly with your broker or insurer. Likewise, if you have exclusions on your CME policy that you believe may no longer apply, you can ask your provider or broker for a review.

3. Medical History Disregarded (MHD)

Medical History Disregarded (MHD) underwriting is usually available to group schemes with 15 or more main members, although in some instances you may need fewer. Under MHD terms, all conditions are covered from the start of the policy—regardless of past medical history—provided they are eligible and don’t form part of the insurer's general exclusion list.

This type of underwriting may be useful for businesses with employees who have pre-existing conditions they want covered immediately. However, due to the higher level of risk for the insurer, MHD policies are often priced higher than those under Moratorium or FMU terms.

Some insurers may request that the group administrator completes a short health declaration before agreeing to MHD terms. If the answers raise any concerns, the insurer may choose not to offer MHD or may apply certain exclusions. As insurer requirements can vary, it's important to review the terms in full and confirm what's needed for MHD to apply. This can usually be done by speaking with a broker or contacting the insurer directly.

Summary of Underwriting Types

To summarise, the five main types of underwriting are:

1. Moratorium (MORI)

   
   

2. Continued Moratorium (CMORI) 

   
   

3. Full Medical Underwriting (FMU) 

   
   

4. Continued Medical Exclusions (CME)

   
   

5. Medical History Disregarded (MHD) 

   
   

Your underwriting type, along with the insurer's general exclusion list, typically determines how claims are assessed. Understanding both is key to knowing what’s covered under your policy. For more details on general exclusions, check out our article 'Understanding General Exclusion Lists' on the blog page of our website

Need Assistance?

If you’re unsure about your current underwriting terms or need help understanding what is and isn’t covered under your policy, you can reach out to your insurer or a broker. A regulated broker can usually provide general guidance to help you better understand your cover and assist you in navigating your private medical insurance policy.

Disclaimers:

Disclaimer 1: The information provided in this article is accurate as of April 13, 2025. However, all details are subject to change in the future based on updates to insurer terms, market conditions, or regulatory changes. For the most up-to-date information, please contact a broker or your insurer directly.

Disclaimer 2: The information provided in this article is intended for educational purposes only and should not be used as specific advice for any individual insurer or policy. For details regarding your specific policy, always refer to your insurer’s policy documents or contact a broker or your insurer directly for personalised assistance.