Insurance Underwriters

Career summary

Insurance underwriters assess the risk of loss from issuing an insurance policy to individuals. They decide whether or not to insure them.

Underwriters examine applications and the reports that come with them. For example, they may read medical reports or statistical studies. Sometimes they contact insurance agents or other sources to obtain more data.

Underwriters analyze the information in applications and reports. They evaluate whether a risk is likely to result in a loss. Many factors affect their decision, depending on the type of insurance. They may consider a person's financial standing, or the value or condition of property.

If an applicant is a high risk, underwriters may decide not to issue a policy. Another option is to issue a policy, but for a value lower than that requested in the application. Underwriters may also issue a policy, but attach endorsements that limit the company's liability. If they decide to issue a policy, underwriters decide how much to charge.

Underwriters often specialize in one of four major types of insurance:

• Life
• Health
• Mortgage
• Property and casualty

Life and health insurance underwriters may also specialize in group contracts. They analyze the overall make-up of the group to be sure that the total risk is not too high.

Property and casualty underwriters often specialize in one type of risk. For example, they may work with fire, homeowners, or car insurance.

All underwriters review the company's overall pattern of insurance. This way they can see how risk is spread and how different groups are insured. They use this to guide future insurance decisions.

Related careers

This career is part of the Finance cluster of careers.

Related careers include:

• Accountants and Auditors
• Actuaries
• Appraisers and Assessors
• Cost Estimators
• Credit Analysts
• Financial Counselors
• Insurance Adjusters and Examiners
• Insurance Policy and Claims Clerks
• Loan Clerks
• Tax Preparers

Job duties

Task list

The following list of tasks is specific to insurance underwriters.

• Examine insurance applications and reports, such as medical reports and statistical studies.
• Analyze applicant information to evaluate level of risk to insure them. Use computer software for analyses.
• Contact insurance agents, medical staff, and others to obtain more information or explain policies.
• Determine how much to charge for policies.
• Turn down high-risk applicants or modify policy so the risk is acceptable to the insurance company.
• Review company records to see patterns of risk and how different groups are insured.
• May analyze the overall make-up of the group being insured to be sure total risk is not too high.
• May specialize in life, health, or property and casualty insurance.

Common work activities

Insurance underwriters perform the following tasks. These tasks are common to many careers.

• Get information needed to do the job
• Make decisions and solve problems
• Analyze data or information
• Use computers
• Establish and maintain relationships
• Process information
• Communicate with people outside the organization
• Organize, plan, and prioritize work
• Communicate with supervisors, peers, or subordinates
• Evaluate information against standards
• Update and use job-related knowledge
• Document and record information
• Identify objects, actions, and events
• Resolve conflicts and negotiate with others
• Explain the meaning of information to others
• Convince others to buy goods or change their minds or actions
• Judge the value of objects, services, or people
• Perform administrative tasks
• Monitor events, materials, and surroundings

Work requirements

Working conditions

In a typical work setting, insurance underwriters:

Interpersonal relationships

• Have a medium level of social contact. They regularly interact with agents and policy holders but also spend time processing paperwork.
• Communicate with agents, supervisors, and policy holders by telephone, email, and in person on a daily basis.
• Often work in a group or as part of a team.
• Are sometimes placed in conflict situations in which others may be rude or angry.

Physical work conditions

• Usually work indoors. They may on occasion be called to look at a property.
• May share the same office space with other employees.

Work performance

• Must be sure their work is exact.
• Make decisions that affect policy holders on a weekly basis. They rarely consult a supervisor before deciding a course of action, such as settling a claim.
• Set most of their daily tasks and priorities without talking to a supervisor first.
• Abide by strict daily deadlines.
• Repeat the same mental tasks.

Hours/travel

• Usually work a standard 40-hour week, but may work longer hours.
• May travel to out-of-town company meetings.

Physical demands

Insurance underwriters frequently:

• Sit for long periods of time.
• Repeat the same movements.

It is important for insurance underwriters to be able to:

• Speak clearly so listeners can understand.
• Understand the speech of another person.
• See details of objects that are less than a few feet away.

It is not as important, but still necessary, for insurance underwriters to be able to:

• See details of objects that are more than a few feet away.
• See differences between colors, shades, and brightness.

Skills and abilities

Insurance underwriters need to:

Communicate

• Understand written information.
• Listen to others and ask questions.
• Read and understand work-related materials.
• Write clearly so other people can understand.
• Speak clearly so listeners can understand.
• Understand spoken information.

Reason and problem solve

• Combine several pieces of information and draw conclusions.
• Analyze ideas and use logic to determine their strengths and weaknesses.
• Use reasoning to discover answers to problems.
• Judge the costs and benefits of a possible action.
• Notice when something is wrong or is likely to go wrong.
• Develop rules that group items in various ways.
• Understand new information or materials by studying and working with them.
• Recognize the nature of a problem.
• Follow guidelines to arrange objects or actions in a certain order.

Manage oneself, people, time, and things

• Check how well one is learning or doing something.

Work with people

• Be aware of others' reactions and understand the possible causes.
• Change behavior in relation to others' actions.
• Look for ways to help people.

Perceive and visualize

• Identify a pattern (a figure, object, word, or sound) that is hidden in distracting material.

Education and training

Educational programs

The programs of study listed below will help you prepare for the occupation or career cluster you are exploring.

Programs of study directly related to this occupation

• Accounting
• Actuarial Science
• Business Management and Administration
• Finance
• Insurance

Other programs of study to consider

• Anatomy
• Auto Body Repair
• Building Construction Technology
• Business Economics
• Business, General
• Physiology

Training

To work as an insurance underwriter, you typically need to:

• have a high school diploma or equivalent;
• have a bachelor's degree; and
• complete moderate-term, on-the-job training.

Education after high school

In the past, many underwriters entered the field with a high school diploma. They worked their way up to the job or took related college course work. However, most employers now require insurance underwriters to have a bachelor's degree. Common areas of study are business administration, finance, and accounting. Majors in related areas are also acceptable.

Work experience

Working in an insurance office provides good experience for this work. An internship with an insurance company while you are in college would be excellent preparation.

On-the-job training

Underwriters receive training on the job. New employees usually start as trainees or assistants to experienced underwriters. As a trainee, you may help collect information on applicants. You may also evaluate routine applications under the supervision of an experienced risk analyst. In addition, you study claims files to learn about the factors associated with losses. As you gain experience, you work on more complicated applications that carry greater risk. Training may last from several months up to a year.

Helpful high school courses

In high school, take classes that prepare you for college. A college preparatory curriculum may be different from your state's graduation requirements.

You should also consider taking some advanced courses in high school. This includes Advanced Placement (AP) and International Baccalaureate (IB) courses if they are available in your school. If you do well in these courses, you may receive college credit for them. Advanced courses can also strengthen your college application.

Helpful electives to take in high school that prepare you for this career include:

• Computer Applications
• Probability and Statistics

The courses listed above are meant to help you create your high school plan. If you have not already done so, talk to a school counselor or parent about the courses you are considering taking.

You should also check with a teacher or counselor to see if work-based learning opportunities are available in your school and community. These might include field trips, job shadowing, internships, and actual work experience. The goal of these activities is to help you connect your school experiences with real-life work.

Join some groups, try some hobbies, or volunteer with an organization that interests you. By participating in activities you can have fun, make new friends, and learn about yourself. Maybe one of them will help direct you to a future career. Here are examples of activities and groups that may be available in your high school or community.

Things to know

Most large insurance companies prefer college graduates. They prefer those who have a degree in business administration or finance, and courses in accounting. Some employers prefer one to two years of related work experience.

Personal traits are also a factor. Employers prefer applicants who have good judgment and show attention to detail. Good communication skills are also helpful.

A master's degree may be helpful if an experienced worker chooses to specialize.

Tips

Work for an insurance company during the summer or get experience as an insurance salesperson. Helpful courses to take include accounting, insurance, business law, and statistical analysis. Courses offered through The Institutes, which represents the combined brands of the American Institute For Chartered Property Casualty Underwriters and the Insurance Institute of America, are also helpful. See the Other Resources section of this description for contact information for this association.

Costs to workers

Insurance underwriters may wish to join a professional association, which may have annual dues. They may also pay for professional development courses or other types of continuing education. Some may desire certification by a national organization and pay for educational materials, courses, and testing.

#Took over national content as had comment on how employers preferred workers who knew how to use computers which I deleted, 5/2/16 cj.

Job listings

Listed below are links to job categories from the National Labor Exchange that relate to this career. Once you get a list of jobs, you can view information about individual jobs and find out how to apply. If your job search finds too many openings, or if you wish to search for jobs outside of Washington, you will need to refine your search.

• Insurance Underwriters 

To get a listing of current jobs from the WorkSource system, go to the WorkSource website .

Wages

Wages vary by employer and area of the country.

Insurance companies usually provide better than average benefits. In addition to common benefits such as paid vacation, sick leave, and health insurance, they may offer life insurance and retirement plans.

Employment and outlook

Washington outlook

The table below provides information about the number of workers in this career in various regions. It also provides information about the expected growth rate and future job openings.

National employment

Most underwriters work for large insurance companies.

Major employers:

• Insurance companies
• Insurance agencies
• Business management companies

National outlook

Demand for this occupation is declining. Computer software has made it possible for underwriters to do more work in less time.

New federal health care laws will require more people to purchase health insurance, leading to an increase in applications. In addition, as the population ages, there will likely be increased demand for long-term care insurance.

Insurance is considered a necessity and there will always be a need for underwriters. Many job openings will be created as current workers transfer to other occupations. Job prospects will be best for those with a background in computers or insurance.

Other resources

American Council of Life Insurers 
101 Constitution Avenue NW, Suite 700
Washington, DC 20001
202.624.2000

Insurance Information Institute 
110 William Street
New York, NY 10038
212.346.5500

The Council of Insurance Agents and Brokers 
701 Pennsylvania Avenue NW, Suite 750
Washington, DC 20004
202.783.4400

References

Career cluster

• Finance

Career path

• Conventional (Business Operations)

O*Net  occupation

• Insurance Underwriters (13-2053.00) 

O*Net job zone 

• Job Zone 4 - Considerable preparation needed. A minimum of two to four years of work-related skill, knowledge, or experience is needed for these occupations.

DOT occupation

• Underwriter (169.267-046) 

Holland occupational cluster

• Conventional/Enterprising/Investigative

COPSystem

• Business Professional