If you’ve seen the term “underwriter” and were never quite sure what it meant, you aren’t alone.
Underwriters are often referred to as the engines of the insurance industry. As a customer, you won’t interact or see them much, but they are the behind-the-scenes experts on all things insurance. Without underwriters, insurance companies wouldn’t be able to insure anyone.
We asked four underwriters at different levels of ERIE what their day-to-day jobs looks like. Here’s what they had to share.
What is an Underwriter?
To break it down, an underwriter is someone in the insurance (or finance) industry who underwrites policies. Through research and analysis, an underwriter determines the risk associated with someone looking to purchase insurance.
For example, if a restaurant owner is looking to insure their business, an underwriter would research all the risk associated with their business. This might include things like fire hazards, age and size of the building; if there are any precarious trees nearby; or how many customers they serve in a day. All of these factors help determine how much and what kind of insurance they would need in case of a kitchen fire or if someone tripped and fell in the restaurant.
“Ultimately, underwriters decide what to insure, what coverages to offer and can help determine prices on occasion,” says Matthew Brown, commercial underwriter. “I actually really like the research aspect of it. And ERIE offers a lot of tools to get the job done.”
What’s a normal day look like for an underwriter?
Many underwriters will spend their day collaborating with the claims, risk control and sales teams, as well as other underwriters, in order to create an insurance policy.
“Much of the day is spent collaborating with my underwriting team,” says Karen Kocjancic, underwriting manager. “One of my favorite parts of my job is collaborating with my underwriting team and coaching them to succeed.”
A big part of their job is working closely with ERIE’s independent agents, answering calls and emails regarding any new customers they are looking to insure. But at its simplest, an underwriter’s day can be broken into two parts: new business and renewals.
- New Business: New business is where an underwriter’s love of research shines. They work with an ERIE agent to understand the client’s insurance needs and risks so they can compile a list of coverages the customer needs, including those required for their region or account type and then can determine an appropriate price.
- Renewals and re-underwriting: If you have a sharp eye for small details, re-underwriting may be one of your favorite aspects of the job. Re-underwriting is looking at accounts already insured with ERIE and checking to see if there are any new risks or exposures that need to be accounted for. Like if a customer recently got a swimming pool installed, they might need some extra coverage.
Hear from Erin, an ERIE underwriter, on how her typical day passes by.
What kind of background do you need to work in Underwriting?
Common qualities of a good underwriter include a keen attention to detail and a love of math or research. Many underwriters have degrees in finance, business or economics when they first start out. As they grow their career, they can earn additional insurance certifications like the Chartered Property Casualty Underwriter (CPCU) or an Associate in Personal Insurance (API).
At ERIE, we have an underwriting trainee program that helps to train individuals interested in this career path. From there you are placed in an underwriting division and can grow your career or advance to a career in leadership.
What’s it like working at Erie Insurance?
Our employees are what make ERIE such a great place to work. Our culture is one of the many reasonspeople choose to work, and build their careers here. Our company was built on the Golden Rule, and we support each other and our local communities through charitable giving and volunteering efforts. Employees are even allowed to spend up to 9.5 hours per year of their workday volunteering in their local communities.
“One aspect of ERIE that I truly enjoy is being able to give where we live,” says Karen. “Over the years I’ve had the privilege to work on a couple of Habitat for Humanity home builds with my ERIE team and was literally swinging the hammer with the prospective homeowner – extremely rewarding.”
Our culture is shaped by the many unique employees we have and their diverse thoughts and experiences.Our Affinity Networks and Employee Resource Groupshelp engage and empower our employees to create an equitable and inclusive work environment.
Join the ERIE Team
At ERIE, we work together to make each other's day better as well as our customers’. Learn more aboutwhat makes ERIE a great place to workandwhat makes Erie, PA a great place to live.Interested in jumpstarting your career at ERIE? Join our team of underwriters andview our current job opportunities.
FAQs
Underwriters are the main link between an insurance company and an insurance sales agent. Insurance underwriters use computer software to analyze risk for determining whether to approve an applicant. They take specific information about an applicant and enter it into a program.
What exactly does an insurance underwriter do? ›
Insurance underwriters are professionals who evaluate and analyze the risks involved in insuring people and assets. Insurance underwriters establish pricing for accepted insurable risks. The term underwriting means receiving remuneration for the willingness to pay a potential risk.
Is it hard being an insurance underwriter? ›
Is being an Entry Level Insurance Underwriter a hard job to learn? Becoming an Entry Level Insurance Underwriter can be challenging due to the complexity of the job, the need for specialized knowledge, and the responsibility of assessing and mitigating risks.
What is the job role of underwriter? ›
Underwriter Job Responsibilities:
Analyze financial data related to loan requests. Evaluate loan documents are to insure accuracy and completeness. Perform risk assessments on potential loan recipients based on credit rating, borrowing history, and other specific risk factors.
Is being an insurance underwriter a stressful job? ›
Underwriters, charged with the critical task of assessing insurance risks and determining policy terms, often face the pressure of high-stakes decisions and tight deadlines. These elements can contribute to long hours and a work-centric lifestyle, especially during peak periods of renewals and policy reviews.
How do underwriters make money? ›
An underwriter is any party, usually a member of a financial organization, that evaluates and assumes another party's risk in mortgages, insurance, loans, or investments for a fee, usually in the form of a commission, premium, spread, or interest.
How to become an underwriter without a degree? ›
Although a university degree isn't a requirement across the board, some employers may hire you if you have relevant work experience and computer proficiency. Keep in mind that if you want to become a senior underwriter or underwriter manager, you'll need some certification.
How long does it take to learn insurance underwriting? ›
With a relevant bachelor's degree in finance, business, or economics, an aspiring Underwriter may start in an entry-level underwriting or insurance role, gaining experience and potentially achieving a full-fledged Underwriter position within 2-4 years.
What type of underwriter makes the most money? ›
High Paying Insurance Underwriter Jobs
- Chief Underwriter. Salary range: $132,500-$257,000 per year. ...
- Underwriting Director. Salary range: $100,000-$168,500 per year. ...
- Property Underwriter. ...
- Casualty Underwriter. ...
- Underwriting Manager. ...
- Production Underwriter. ...
- Underwriting Consultant. ...
- Senior Underwriter.
The workforce of Insurance underwriters in 2021 was 115,798 people, with 63.2% woman, and 36.8% men. The average age of male Insurance underwriters in the workforce is 41.1 and of female Insurance underwriters is 44.6, and the most common race/ethnicity for Insurance underwriters is White.
Underwriters perform an essential task in the financial sector. Usually, as part of a large institution, underwriters evaluate and assume risk in exchange for profit. This risk results from numerous financial services, including mortgages, loans, insurance and investments.
Who pays the underwriter? ›
Underwriters who focus on financial investments will work with investors to determine the price of an offering. The insurance underwriting fees will usually be a set amount, while the underwriters who work with investors will receive their fees as a small percentage of the proceeds from the shares.
Why hire an underwriter? ›
Ultimately, an underwriter ensures that all loans meet legal guidelines and works to mitigate a company's overall financial risk. You might hire an underwriter to: Create risk assessment reports for each applicant. Research an applicant's financial background, including credit, employment, and asset information.
Can you work from home as an underwriter? ›
What Does a Remote Insurance Underwriter Do? The job duties of a remote insurance underwriter focus on assessing the risk in insurance policies. In this virtual position, you work from home or from a remote office to evaluate the risk of each client who has applied.
What does an underwriter do day to day? ›
Insurance underwriters determine risk, premiums, and the extent of coverage for insured parties. Most companies require insurance underwriters to have an undergraduate degree, some experience in the insurance industry, and may even need underwriters to be certified.
What is riskiest to the underwriter? ›
In the securities industry, underwriting risk usually arises if an underwriter overestimates demand for an underwritten issue or if market conditions change suddenly. In such cases, the underwriter may be required to hold part of the issue in its inventory or sell at a loss.
What is the difference between an insurance agent and an underwriter? ›
These industry professionals can work independently or as part of an insurance brokerage firm. So, while an insurance underwriter puts the interest of the insurance company first, an insurance broker serves the customers, helping them find the coverage that suits their needs and budget.
Do insurance underwriters talk to customers? ›
At an insurance company, underwriting is performed by underwriters. Insurance underwriters evaluate insurance applicants, accept the good ones, and reject the risky ones. Underwriting is an “inside job” so underwriters rarely interact with customers.
How long does it take an underwriter to approve insurance? ›
Underwriting can take as little as 24 hours but could last 4 to 6 weeks.
What is the difference between a claims adjuster and an underwriter? ›
The underwriter, who determines the risk and cost of the policy, performs her job before insurance is approved and provided. To understand the relationship between claims and underwriting, consider that the claims adjuster comes in when the insurance company must decide whether to pay a claim.
