Which of the following is true about claims history?

Claims history is an important factor in determining the premium rates for policyholders. Insurance companies use this history to assess the risk posed by a particular individual. When someone has a history of frequent or severe claims, it indicates a higher risk for the insurer. As a result, insurers might increase premiums to account for this elevated risk or deny coverage entirely.

Insurance companies analyze past claims to decide how likely a policyholder might file future claims, which in turn influences the overall cost of coverage. Therefore, the statement about the impact of claims history on policyholder premium rates is accurate and crucial for understanding how the insurance underwriting process works.

Other options do not accurately reflect the role of claims history in insurance. It is not restricted to new policyholders, nor does it only apply during claims processing. Additionally, claims history plays a significant role in the underwriting process and is not ignored by insurers when assessing risk.