Decline

What Does Decline Mean?

In the context of insurance, “decline” refers to the rejection of a request for insurance coverage. An insurance company typically declines an application if the business or individual applying is deemed to represent too high a risk, making it unlikely for the insurer to pay out large amounts. Each insurer evaluates risk based on its own company standards and specific industry criteria.

Insuranceopedia Explains Decline

Since insurance companies prefer policyholders who represent lower risks, they tend to decline applications from entities that pose higher risks or have a greater likelihood of making claims. The decision to decline coverage depends on the standards of each insurance company, so one insurer’s rejection does not necessarily mean that all others will decline the application as well. In such cases, an appeal may be a viable option, and it is often recommended to consult with a risk specialist to secure a policy, especially in more challenging situations.