To underwrite insurance means to accept financial responsibility for your clients’ potential losses. Insurance underwriters work out the risk for insuring a particular person or company. As an underwriter you would decide whether to accept an insurance application, and what the terms, conditions and cost of the insurance policy would be.
To work in this role, you need to be a confident communicator, with good negotiation skills. You also need to be able to analyse complex information. If you are a decisive person who enjoys working with figures, then this role could be right for you.
You could apply for a specific graduate training course in underwriting if you have a relevant degree. It’s also possible to get into this role by working your way up from a junior or assistant underwriting position, and there are sometimes opportunities to do this through an Apprenticeship scheme. It would also help to have some experience of working in the insurance industry.
• study insurance proposals
• gather background information, such as medical histories
• analyse statistics from actuaries and other sources
• get specialist risk assessments from experts, like surveyors or doctors
• assess risk (the likelihood of an insurance payout)
• calculate the price of insurance premiums
• judge whether some of the risk should be shared with another insurer (known as 'reinsurance')
• prepare quotes and negotiating terms with brokers or business clients
• decide whether any special conditions should apply to policies
• write policy wording
• maintain accurate and detailed records.
You would work closely with actuaries who are experts in calculating risk. You would also work alongside claims and risk managers, brokers and other insurance professionals. See the Related careers list for more information on these roles.
As an underwriter, the types of company you could work for include:
• general, health or life assurance insurers
• reinsurance companies
• banks or credit agencies as an in-house underwriter.
The majority of underwriters work in Major Tier 1 Cities and surrounding areas, particularly commercial underwriters. However, there are also regional opportunities in large towns and cities.
Jobs may be advertised in the local press, in industry magazines and by financial services recruitment agencies.
With experience, you could deal with more complex risks. Specialist knowledge could improve your promotion prospects. You could also move into general management or apply for related jobs like risk management, loss adjusting and claims management.
If you speak more than one language, you may find that there are opportunities to travel and work overseas.
• working up from a junior position
• completing a graduate training programme in underwriting.
Working up from a junior position
A lot of insurers employ underwriting assistants to work in their call centers dealing with immediate quotations and straightforward insurance cover. You may be able to join an underwriting team in one of these roles and then work your way up. Companies set their own entry requirements, but it will help your chances of finding work if you have Graduation in English and maths and some Diploma levels.
It may also be possible for you to enter as a trainee or junior underwriter through a Level 2 Apprenticeship or Level 3 Advanced Apprenticeship in Providing Financial Services.
Once you are working for an insurance company, you will be trained through in-house courses and learning on the job from experienced underwriters. You may spend up to two years learning about various types of insurance and claims, followed by up to three years’ further training in a specialist area of risk.
As long as Insurance is considered a necessity for people and business, there will be scope for underwriters. To 'underwrite' means to accept liability for possible losses by clients. Underwriters calculate the financial risk of insuring a business or an entity, for prospective and current clients. Underwriters are active in different lines of insurance business, such as auto, home, commercial and farm insurance, individual, life and group life and health.
Underwriters review new or renew applications for insurance coverage, both for individuals and companies. Underwriting involves identifying, evaluating, and estimating the level of risk involved, establishing premiums matched to the risk and recommending coverage. Underwriters are integral to our long-term success and financial viability.
Underwriters measure risk exposure and determine the premium that needs to be charged to insure that risk. They take care of risk management. It is the underwriter who reviews the insurance applications and decides whether they should be accepted or rejected. Underwriters review insurance policies and coverage to determine if policyholders have the right amount of coverage, or if they should be insured with the company at all. An underwriter evaluates an applicant's exposure to risk and decides whether an applicant meets an insurer's standards. An underwriter may also become involved in setting prices for insurance applicants. An underwriter is a person who evaluates potential clients of a finance company or a bank. He assesses the fitness of an individual for the insurance services provided by an insurance firm.
Persons with excellent communication and computer skills along with a strong background in finance will have the best opportunities for employment in this field. Work as an underwriter differs depending on the type of insurance, as the types of clients the underwriter works with and the risks that are assessed will be different. The most important underwriting skills are learned on the job. As such, many underwriters begin their careers as trainees or assistant underwriters.
There are several institutes conducting courses related to finance and accounting. Major Universities include courses
Specialisations in India with common subjects:
» B.Com. Accounting and Finance
» M.Com. Finance
» BBA (Bachelor of Business Administration)
Remuneration is based on the employer, locality, experience and area of specialisation. Those who are employed in banks and insurance companies can expect a better pay scale than one employed in private agencies and real estate firms. Apart from fixed pay they also receive allowances, commission or brokerage, insurance coverage, retirement benefits etc.
One can expect a starting salary ranging Rs. 6,000 - 8,000 plus brokerage. After gaining experience as an underwriter they can reach top positions as that of senior underwriter where pay scale may not be a constraint.