If you delve into the industry of insurance you will find several groups of professionals working hand-in-hand to provide security to their clients, amongst them the insurance underwriters play a significant role. Insurance underwriters are the professionals skilled in analyzing risks.
Who are the underwriters?
Underwriters are the professionals, hired by the insurance companies to write businesses for them. The underwriters work in accordance with the insurance companies to protect the insurer from insuring bad-risks. The job of the underwriter involves
•Making final decision regarding accepting or declining an insurance application
•Locating and finally assessing the hidden risks that the insurer might have failed to identify.
•Developing and designing competitive insurance products
•Determining and structuring the premium rates
•Determining the need of add-ons and endorsements to a policy
The insurance underwriter walking on the tight rope
The job of an underwriter involves constant challenges and anxieties. An underwriter is required to work with equal efficiency with every policy application. One mistake on their part can cost the insurance company thousands of dollars. The insurance company can lose business to the competitors for erroneous representation of risk. They can also suffer loses if their underwriter develops a lenient approach towards writing the policies. Therefore, an underwriter has to protect the interest of the insurer and at the same time has to write enough business for the insurer to survive the competition. Every insurer sets their own underwriting guidelines which the underwriter has to comply while writing polices.
Career opportunity in the field of underwriting
As a career, underwriting can be quite rewarding. An underwriter can make around $50,000 and above in a year, depending upon the type of insurance he writes. The average working hours for an underwriter is 40 hrs. a week.
One has to begin as an assistant or trainee underwriter, working under the supervision of the senior underwriters of their respective line of insurance. The job of the junior underwriter involves collecting information on the applicant and learning the methods of underwriting. The value of the underwriter grows with his/her experience.
How can you become one of them?
Though the prerequisite for the profile is graduation, but more and more insurers are now getting inclined in hiring college graduate with degrees in business administration, mathematics, economics, accountancy and the like. Along with proficiency in finance and computer is necessary. Adequate knowledge in finance and market may help an individual to face the challenges associated with the profile. An underwriter should also possess good communication and analytical skills.
The challenges before the career
•Increasingly the insurers are using underwriting software for their businesses for faster and accurate analysis of risk. Use of the tool is also reducing the scope of human error, thus affecting the pace of job creation in this field.
•Normally an underwriter gets confined to a particular line of insurance underwriting like-life or P&C or business, because each form of insurance needs to meet special sets of underwriting requirements. Hence, job switching is a problem faced by the professional in this field.
•More and more insurers are now setting degree in business administration or mathematics as the prerequisite for the job of underwriting. Its, thus, preventing the other college grads from entering into this profession.
