what is an underwriter?

An underwriter is a type of financial advisor who evaluates risk. As an underwriter, your job is to examine applicants and see how stable their finances are. You use your specialized knowledge to determine whether or not your company is likely to lose money by working with the customer. Your job consists of analyzing applications and then making recommendations for how to handle the application. In addition to denying and approving applications, you also suggest prices to charge the client. You'll do things like state a fee or interest rate that the client must pay to get a loan or insurance policy with your company. Overall, your main goal is to ensure that the amount of money the customer pays outweighs the risk they represent to your company.

where do underwriters work?

This position is very useful to financial companies. Underwriters often work in insurance industries. They determine whether an applicant will apply for a policy and see how much the applicant's premium should be. Another common position for underwriters is in lending industries. Underwriters help banks and mortgage companies figure out what sort of loan a candidate is eligible for. Finally, some underwriters work for securities and investment companies. They consider how much risk is involved in initial public offerings (IPOs) and recommend prices for investments.

Would working as an underwriter suit your logical and mathematical skills? Then read on to find out what competencies and qualifications you need to thrive in an underwriter role.

underwriter jobs near you

average underwriter salary

Being an underwriter is typically a job that pays above-average wages. The U.S. Bureau of Labor Statistics (BLS) reports that underwriters make between $47,000 and $126,000 per year. On average, they earn $76,390 each year and get paid $36 per hour. Underwriters usually work a full-time job and get paid an annual salaried wage instead of an hourly wage.

factors that affect your salary

The main factor that affects your salary is your location. Underwriters in areas with a high cost of living typically make more. People who work with financial institutions and loan providers make slightly more than underwriters who work in insurance. Your employer also impacts your wages because larger and more prestigious institutions often pay larger salaries. The final factor to consider is your responsibilities. Some underwriters work very independently and create entire contracts for customers to sign. Others only prepare recommendations and have to get a supervisor to approve all suggested contracts. Those who have more responsibility tend to make higher salaries.

Would you like to know what an underwriter earns? Where the highest salaries are paid for an underwriter? Then check out this underwriter salary page and find out all about the salary of an underwriter in the USA.

Four people having a conversation in a meeting room at an office.
Four people having a conversation in a meeting room at an office.

types of underwriter

There's quite a bit of overlap between types of underwriters, but most people categorize underwriters based on where they work. Common types of underwriters include:

  • insurance underwriter: This is the most common type of underwriter. They recommend insurance policy premiums based on candidates' health, lifestyle, location, or driving record.
  • mortgage underwriter: These underwriters assess the right interest rate for mortgage applicants. They consider both the applicant's finances and the value of the desired home.
  • securities underwriter: Securities underwriters create pricing options for IPOs. They figure out how much new stocks should sell for. If they price it too high, their investment bank may be liable to pay the difference.

working as an underwriter

If you're considering this job, it's helpful to learn what it's like to be an underwriter. Discover what your work environment is like, who your coworkers are, and more.


underwriter skills and education

Being an underwriter is a skilled position that you need some training to perform. Before you can find a job, you need to make sure you have these requirements:

  • education: The primary requirement for any underwriter is a bachelor's degree in a relevant field. Employers will usually accept any degree that shows you have financial or mathematical skills. Some popular degrees include accounting, mathematics, or economics. Though very rare, some companies may hire underwriters with just an associate's degree as long as they meet other qualifications.
  • certifications: This field encourages job candidates to get certifications. Life Underwriter Training Council Fellow (LUTCF) and Chartered Life Underwriter (CLU) certifications are especially popular.
  • experience: Underwriters usually need around a year of training before they can work independently. It's easier to get hired as an underwriter if you have one to two years of experience as an associate underwriter or underwriting assistant.
  • ongoing training: Underwriter policies are always changing as government regulations change. If you've been an underwriter for a while, you could need to get updated training before applying for new jobs.

skills and competencies

Successful underwriters tend to excel in these areas:

  • attention to detail: Underwriters need to pay attention to small facts and bits of data. Even when your work is repetitive, you should be able to notice essential details.
  • mathematics: You'll spend a lot of time calculating things like loss probability and the total amount of debt, so you need to be comfortable with math. Computer programs will handle most details, but it's still important to understand how statistics and probability work.
  • technology: You do most of your work with software, so computer skills are a must. Most modern underwriters also need to be able to send and receive documents via email and cloud-sharing programs.
  • communication: Since you discuss matters with clients and colleagues, it's helpful to have interpersonal skills. Good underwriters can express ideas clearly while sounding polite and professional.
  • decision-making: In upper-level jobs, you make decisions that can cost your company thousands of dollars. You need to be level-headed and confident in your own choices.
woman smiling
woman smiling

FAQs about working as an underwriter

Here you will find answers to the most frequently asked questions about underwriters.

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