On the territory of the Russian Federation, there is a “Unified Tariff and Qualification Guide”, which has more than 7 thousand various types of professional activity. This is only for this country. There are many more professions in the world. And in Russia there are still many specialties that are not listed in this directory, which are quite rare. Currently, a profession that few people have heard of before is gaining popularity. Its name is the underwriter. The specialty is quite in demand in the modern labor market.
An underwriter is ...
The name of the profession for most is outlandish and incomprehensible. For this reason, people often ask when they hear the word "underwriter": "Who is this?" Meanwhile, this intricate word is called one of the main specialties in the field of insurance. If you translate the name of the profession, it means "signature on the risks." This clearly defines the underwriter's occupation. A person of this specialization is engaged in assessing, describing and assigning qualifications to existing risks for the formation of an insurance portfolio.
An important factor in this, as in any other profession, is earnings based on the results of work. He reaches a fairly high level. But big money is associated with a wide range of responsibilities. For this reason, the question: “Who is the underwriter?” you can answer by simply listing all the functions that it performs: working with insurance contracts and policies, analyzing possible risks, advising agents and managers and developing methods, etc.
Banking underwriter
This profession exists not only in insurance. Often there is an underwriter in the bank. After all, it is difficult to imagine lending without assessing the risks of default on debt. The institutions where the underwriter works are Sberbank or similar joint-stock companies that provide various loans to the population. These organizations are required to have such a specialist in their staff. A bank underwriter is a qualified staff engaged in appraisal activities to determine the risks of default on a loan being issued. This procedure must be carried out by each financial institution.
To establish the level of solvency of the borrower at the stage of deciding whether to refuse or grant a loan allows the work of a person in this profession. The determination methods can be completely different, so a Gazprombank employee can analyze differently than the underwriter at Sberbank, whose feedback from borrowers is positive. But the responses of banks about the work of such professionals can qualitatively affect the size of wages.
In addition to refusing a person who wants to take a loan, an alternative option for cooperation can be provided. It is compiled on different conditions for the borrower and may offer him a different amount. This option is selected in accordance with the conclusion made by the underwriter. For this reason, a denial may not always be based on a low level of solvency.
Insurance Underwriter
In this area, a professional analyzes risk. An underwriter is a person authorized to form an insurance portfolio, he has all the rights to make decisions.
Taking this position is not easy. Insurance companies put forward a whole list of requirements, consisting in the possession of a variety of technical and practical knowledge that a candidate must possess. This knowledge also includes those that will allow you to correctly analyze and make a conclusion about the level of possible risks, the conditions for obtaining insurance and the amount of rates.
An underwriter in insurance must fulfill the main task - this is to achieve a positive financial result without risks. This happens by observing a number of rules and algorithms for a specialist to create a portfolio.
As a result, the work of the underwriter is directly proportional to whether the company will receive a good profit, or, conversely, suffer losses.
Risk assessment of insurance contracts
An underwriter is a person who must sight documents to conclude a risk agreement and assign them the appropriate qualifications for a particular object or individual. Also, a person in this profession determines the tariff rates and conditions under which the insurance contract will be concluded, makes a conclusion about the possibility of such transactions.
The underwriter assesses all possible risks for insurance of both the individual and property. He has all the necessary information about the budget, the formation of reserves, as well as reinsurance and how to manage losses. In general, this is the person whose one signature can cost thousands and even millions.
Job responsibilities
The responsibilities of this specialist include:
- Carrying out the following actions:
- sight of documents on behalf of the company;
- taking risks for insurance or reinsurance;
- risk qualification;
- setting rates for tariffs and transaction conditions;
- drawing up a conclusion on the possibility of signing a contract;
- portfolio formation.
- Consultation in areas such as the right to endorse documents and liability for the signature.
- Risk assessment.
- Principles of building an insurance portfolio.
- Legal aspects of the activity.
- Financial sustainability of the enterprise.
- Budget control.
- Settlement of losses.
Main functions
Work as an underwriter is an activity carried out as part of the following algorithm of actions:
- Identification for the object to be insured. Verification of documents confirming the rights to property participating in the contract.
- Risk assessment. Determining the reasons for the possible deviation of the object, if the client is suspected of providing false information.
- Making decisions on the possibility of concluding a contract. Underwriting of an object can be both medical, financial, and professional. In this case, a big role is played by the analyst of the specialist who gives the conclusion, as well as his professionalism in predicting the possible development of the situation.
- Definition of the list of contract terms - both basic and additional. The underwriter is authorized to decide which risk group the proposed case belongs to. On this basis, he has the right to introduce into the insurance contract those additional conditions that he considers necessary and determining the further course of the transaction. An example of such additions can be the amount or duration of a transaction.
- Tariff setting, calculation of premiums. The underwriter conducts its own analysis and establishes the amount of compensation in accordance with the rules of insurance law and benefits already accepted by the company. If the risk of the transaction is high, the odds increase accordingly.
- Signing an insurance contract.
Skills and Perspectives
The presence of an analytical mindset is the most important feature of a person who dreams of carrying out his activities as an underwriter. The history of the profession suggests that the employer pays attention to this. The specialist must be well and quickly navigate the trends that accompany the insurance business, and know the principles of formation of its products. Well, of course, a professional in his field should know foreign languages, usually English.
The insurance business in Russia still has great potential for development, so the prospects for underwriters are quite extensive. In addition, risk assessors will be in demand in other areas. In addition, experienced employees with an experience of 2-3 years can count on the position of head of department.
Education
In the framework of the Russian Federation, the largest educational institution that educates its students in insurance programs is MGIMO, the Russian Ministry of Foreign Affairs. It is this institution that is engaged in the preparation of underwriters. There are also continuing education courses. Obtaining the profession of an underwriter may be accompanied by further employment if you become a student at the Institute of Management and Entrepreneurship at GUU.
The faculties in which education is related to insurance are in many universities with an economic bias. Regional universities are places where future successful underwriters can also receive diplomas.
Pros and cons of the profession
In underwriter activities, the shortcomings can be considered continuing virtues. A person of this specialty, unlike an insurance agent, has a stable income, since he works on a salary. Of course, the underwriter cannot count on big bonuses, but in contrast to this we can say that he has a fixed monthly income. These specialists are usually credited to the staff, which means they are socially protected. The “underwriter” profession means working according to a fixed schedule - with weekends and vacations.
The disadvantages of the profession include the fact that a person who is used to working with numbers and papers also needs to be able to conduct a conversation with clients. Well, the biggest drawback of the profession is, of course, the responsibility imposed by the company.
Lead Underwriter Choice
The selection of these specialists should be carried out according to the following criteria.
- Track record analysis. First you need to find out the qualification level of the candidate.
- Reliable reputation. In order to carry out large and profitable transactions, the underwriter must be respected by professionals and partners involved in this field.
- Financial conditions presented by the candidate. It should be borne in mind that the costs of paying for underwriter services can be a significant amount.