What does underwriting in insurance primarily involve?

Underwriting in insurance primarily involves evaluating risks and determining coverage terms. This process is crucial as it helps insurance companies assess the likelihood of a claim being made against a policy and decide the appropriate terms and pricing for that coverage. Underwriters analyze various factors, including the applicant's history, potential hazards, and overall risk exposure to make informed decisions. This risk assessment ensures that the insurance company remains financially stable while providing necessary protection to policyholders.

While the other options play important roles in the insurance industry, they do not capture the essence of underwriting. Investing in insurance stocks pertains to the financial aspect of the business rather than the risk evaluation. Marketing insurance products is focused on promoting the policies to potential customers, and monitoring policyholder satisfaction relates to post-policy issuance engagement, none of which directly involve the initial assessment and coverage determination that defines underwriting.