Insurance underwriter

Definition

An insurance underwriter evaluates and analyzes the risks involved in insuring people and assets. They determine policy terms and premiums by assessing the likelihood of claims being made.

5 Must Know Facts For Your Next Test

1. Insurance underwriters use statistical data to assess risk levels.
2. They work with actuaries to set appropriate premium rates for policies.
3. Underwriters must comply with regulatory requirements and company policies.
4. They play a crucial role in preventing insurance fraud by thoroughly analyzing applications.
5. Technology, such as underwriting software, is increasingly used to streamline their assessments.

Review Questions

• What role does an insurance underwriter play in determining policy premiums?
• How do insurance underwriters use statistical data?
• Why is compliance with regulatory requirements important for insurance underwriters?

Related terms

Actuary: A professional who analyzes statistical data to calculate insurance risks and premiums.

Risk Assessment: The process of identifying and evaluating potential risks that could negatively impact an organization or individual.

Premium: The amount of money charged by an insurer for coverage over a specified period.