Is insurance coverage right for you?

If you have ever filled out any type of insurance application, you will be faced with issues that insurance companies use to determine the level of risk you pose, premiums, and the coverage you are eligible for. The person reviewing and evaluating your response is the insurance underwriter. This job requires a thorough and decisive person with excellent analytical skills. If you have a financial background and pay attention to details, you may want to consider insurance underwriting as a profession.

What does an insurance underwriter do?

Underwriting refers to taking responsibility for potential losses to customers. Therefore, the insurer will review the new insurance application or renewal application of individuals and companies. With the help of a computer program, the insurer determines the risks involved in providing insurance for a particular individual or company and calculates the appropriate premium for the amount of insurance required. These are important decisions, because insurance companies take billions of dollars in risk every year. If the insurer is too conservative, the insurance company may lose business. If they are too generous, the company may have to pay too many claims.

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Insurers work for insurance companies, and they are usually located at the company’s headquarters or regional branches. Coverage is usually a standard 40-hour desk work per week, but overtime may be required, depending on each covered item. Evening and weekend hours are not uncommon.

The use of computers and technology is an important part of underwriting. The computer software system is used to analyze and rate insurance applications, make recommendations based on risks, and adjust insurance rates based on risks.

Job opportunities for insurance underwriters

There are many work lines for insurance underwriters, but there are four main areas:

  1. life insurance
  2. Health insurance
  3. Mortgage insurance
  4. Property/accidental injury insurance

The responsibilities of the insurer vary for each type of insurance, because the type of customer and the level of risk will vary.

Tools of the Trade

Most employers prefer candidates with a university degree or professional title and some insurance-related experience. A bachelor’s degree in almost any field may be sufficient to qualify a person to start a career in the insurance industry, but employers may prefer applicants with work experience in business, law, accounting, or insurance and insurance.

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The most important underwriting skills are learned at work. Therefore, many underwriters start their careers as interns or assistant underwriters. During this time, they help collect and evaluate information about customers, but are supervised by the company’s experienced underwriters. Some large insurance companies provide their own comprehensive training programs, which usually include learning and gradually assigning more complex tasks.

Strong computer skills are essential for underwriting professions. Therefore, as the programs used by these professionals continue to be updated, on-the-job computer training often runs through the entire career of the underwriter.

Underwriter Certification

As with other professions, certification can improve the profitability of insurance underwriters and open up new opportunities for promotion. Underwriters with experience and additional positions may be promoted to senior underwriters and management positions, although some employers require a master’s degree to reach this level.

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AU and API designations usually take at least one year to complete, while CPCU designations require three years of insurance experience, and candidates must pass eight exams.

Show me the money

Statistics collected by the U.S. Bureau of Labor Statistics in 2020 show that the average annual income of insurance insurers is $71,790.

In addition, insurance companies can also provide above-average benefits, such as retirement plans, and of course high-quality group life and health insurance. They can also provide salary incentives and tuition reimbursement.

In summary

Finding a suitable position in the work world is usually not a straight line; it is normal to try some potential career opportunities. However, if you are a person who pays attention to details, is good at analysis, and likes to put parts together to solve problems, then insurance underwriting may be a good career for you.

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