Underwriters, also known as insurance writers, are appointed to look into insurance contracts from a third party point of view. Upon receiving an honest opinion from these professionals, both the parties entering into a contract agreement accept to go ahead with the deal and complete the further procedures. In short, they identify appropriate applicants for an insurance cover and determine the terms of acceptance for these applicants. They see that the company does not suffer any financial losses and makes considerable profits.
Their main job is to asses the risk in an insurance contract. Insurance has become a necessity of today's modern life. Earlier, an insurance was designed to cover life or business alone, however, it has now evolved to cover many different aspects of human life. Risk is a crucial factor of any insurance process. The underwriting personnel utilize their expertise to calculate the risks in insuring an individual or business. They weigh up numerous components and carefully examine the detailed information of the insurance policy holders to evaluate the risks.
When it comes to assessing the risk of a property, they study momentous factors like the value of the property, appreciation and depreciation in the value, etc. They then inform the insurance company about the correct insurance amount and the premium is calculated from thereon. If there is any damage incurred by the property, the insurance company assesses the damage and pays the appropriate amount to the insured person.
They are required to work with other experts like physicians, risk and claims directors, and actuaries and rely on their analysis and observations. They consider the statistical data and predictions made by the actuaries regarding insurance payment periods (i.e., the time period in which the company will have to make insurance payouts) and the accurate age groups of people which will be claiming the payments in the future. Besides, they cautiously interpret the exact health reports provided by the physicians to assess the condition of the insured party. Other major facets like family history and hereditary illnesses are also taken into account.
Duties and Responsibilities
Aspiring candidates can also enroll themselves in professional certifications like Chartered Life Underwriter, Chartered Property Casualty Underwriter, etc., to find great benefits in their careers.
Underwriters can easily get promoted to senior management positions if they acquire the required skills, experience, and knowledge. Besides, they hold good opportunities to earn attractive incentives and commissions based on the project and the company.
The work of an underwriter may just seem like executing the single task of risk assessment, however, for a matter of fact, he carries out a number of critical responsibilities which prove crucial in saving millions of dollars every year. His assessment helps to reduce insurance frauds and is beneficial to both the insured party and the insurer.