Career Facts

Investigate MORE INFO on all professions that sound interesting. Take your time. Don't skip a step.

Job Outlook: -5% (Decline)

  1. Is WHAT YOU DO enjoyable?
  2. Does the WORK ENVIRONMENT feel comfortable?
  3. Are you ok with THE REQUIREMENTS?
  4. Is the PAY ENOUGH?
  5. Is the JOB OUTLOOK positive- more than 7%?
  6. Still interested? WATCH THE VIDEO
  7. RELATED OCCUPATIONS Click here to view similar jobs.
FIND A JOB and more.

What Insurance Underwriters Do About this section

Insurance underwriters
Insurance underwriters use computer software programs to determine whether an applicant should be approved.

Insurance underwriters decide whether to provide insurance, and under what terms. They evaluate insurance applications and determine coverage amounts and premiums.

Duties

Insurance underwriters typically do the following:

  • Analyze information stated on insurance applications
  • Determine the risk involved in insuring a client
  • Screen applicants on the basis of set criteria
  • Evaluate recommendations from underwriting software
  • Contact field representatives, medical personnel, and others to obtain further information
  • Decide whether to offer insurance
  • Determine appropriate premiums and amounts of coverage
  • Review and update the rules that govern automation software

Underwriters are the main link between an insurance company and an insurance agent. Insurance underwriters use computer software programs to determine whether to approve an applicant. They take specific information about a client and enter it into a program. The program then provides recommendations on coverage and premiums. Underwriters evaluate these recommendations and decide whether to approve or reject the application. If a decision is difficult, they may consult additional sources, such as medical documents and credit scores.

For simple and common types of insurance, such as automobile insurance, underwriters can typically rely on automated recommendations. For more specific and complex insurance types, such as workers’ compensation, underwriters need to rely more on their own analytical insight.

Underwriters analyze the risk factors appearing on an application. For instance, if an applicant reports a previous bankruptcy, the underwriter must determine whether that information is relevant to the policy being applied for. The underwriter would likely consider how far in the past the bankruptcy occurred and how the applicant’s financial situation has changed since the applicant filed for bankruptcy.

Insurance underwriters must achieve a balance between risky and cautious decisions. If underwriters allow too much risk, the insurance company will pay out too many claims. But if they don’t approve enough applications, the company will not make enough money from premiums.

Most insurance underwriters specialize in one of three broad fields: life, health, and property and casualty. Although the job duties in each field are similar, the criteria that underwriters use vary. For example, for someone seeking life insurance, underwriters consider the person’s age and financial history. For someone applying for car insurance (a form of property and casualty insurance), underwriters consider the person’s driving record.

Within the broad field of property and casualty, underwriters may specialize even further into commercial (business) insurance or personal insurance. They may also specialize by the type of policy, such as for automobiles, boats (marine insurance), or homes (homeowners’ insurance).

Work Environment About this section

Insurance underwriters
Most underwriters work full time.

Insurance underwriters held about 119,400 jobs in 2020. The largest employers of insurance underwriters were as follows:

Direct insurance (except life, health, and medical) carriers 44%
Insurance agencies and brokerages 21
Other insurance related activities 6
Direct health and medical insurance carriers 4
Credit intermediation and related activities 4

Underwriters work indoors in offices. Although underwriters spend most of their time working alone on applications at a computer, they sometimes must handle customer inquiries.

Some property and casualty underwriters may travel to assess properties in person.

Work Schedules

Most underwriters work full time.

How to Become an Insurance Underwriter About this section

Insurance underwriters
Most firms prefer to hire applicants with a bachelor’s degree.

Insurance underwriters typically need a bachelor’s degree to enter the occupation. However, insurance-related work experience and strong computer skills may be enough for some positions. Certification is generally necessary for advancement to senior underwriter and underwriter manager positions.

Education

Employers usually prefer to hire candidates who have a bachelor’s degree. A common field of degree is business. Coursework in finance, economics, and mathematics is helpful.

Training

Beginning underwriters usually work as trainees under the supervision of senior underwriters. Trainees work on basic applications and learn the most common risk factors. Some companies offer training programs that include classroom instruction on the basics of underwriting.

As new underwriters gain experience, they work independently and handle more complex applications.

Licenses, Certifications, and Registrations

Employers often expect underwriters to become certified through coursework. These courses are important for keeping current with new insurance policies and for adjusting to new technology and changes in state and federal regulations. Certification is often necessary for advancement to senior underwriter and underwriter management positions. Many certification options are available.

For underwriters with at least 2 years of insurance experience, The Institutes offer the Chartered Property and Casualty Underwriter (CPCU) designation. For beginning underwriters, The Institutes offer a training program.

The Institutes also offer several other designations in insurance specialties, including the Associate in Commercial Underwriting (AU) and Associate in Personal Insurance (API). To earn these designations, underwriters complete a series of courses and exams that generally takes 1 to 2 years.

The National Association of Insurance and Financial Advisors offers the Life Underwriter Training Council Fellow (LUTCF) designation, which consists of a three-part curriculum in basic insurance concepts.

The American College of Financial Services offers the Chartered Life Underwriter (CLU) certification. This certification consists of five core courses and three electives, and candidates must have 3 years of related work experience.

Important Qualities

Analytical skills. Underwriters must be able to evaluate information from a variety of sources and solve complex problems.

Decisionmaking skills. The core function of an underwriter is making decisions, such as whether to offer insurance coverage and at what level to set premiums.

Detail oriented. Underwriters must pay attention to detail, because each individual item on an insurance application can affect the coverage decision.

Interpersonal skills. Underwriters need good communication and interpersonal skills because much of their work involves dealing with other people, such as insurance agents.

Math skills. Determining the probability of losses on an insurance policy and calculating appropriate premiums require mathematical ability.

Pay About this section

Insurance Underwriters

Median annual wages, May 2021

Financial specialists

$77,300

Insurance underwriters

$76,390

Total, all occupations

$45,760

 

The median annual wage for insurance underwriters was $76,390 in May 2021. The median wage is the wage at which half the workers in an occupation earned more than that amount and half earned less. The lowest 10 percent earned less than $47,330, and the highest 10 percent earned more than $126,380.

In May 2021, the median annual wages for insurance underwriters in the top industries in which they worked were as follows:

Credit intermediation and related activities $78,060
Direct health and medical insurance carriers 77,290
Insurance agencies and brokerages 76,450
Direct insurance (except life, health, and medical) carriers 76,040
Other insurance related activities 62,320

Most underwriters work full time.

Job Outlook About this section

Insurance Underwriters

Percent change in employment, projected 2020-30

Total, all occupations

8%

Financial specialists

5%

Insurance underwriters

-2%

 

Employment of insurance underwriters is projected to decline 2 percent from 2020 to 2030.

Despite declining employment, about 8,300 openings for insurance underwriters are projected each year, on average, over the decade. All of those openings are expected to result from the need to replace workers who transfer to other occupations or exit the labor force, such as to retire.

Employment

Automated underwriting software allows workers to process applications more quickly than before, reducing the need for as many underwriters. As this technology improves and becomes more widely adopted in the insurance industry, more underwriting decisions will likely be made automatically.

However, there still will be a need for underwriters to review and update the criteria that run the automation. In addition, their analytical insight will still be needed in complex or specific insurance fields, such as workers’ compensation, marine insurance, or health insurance.

Employment projections data for insurance underwriters, 2020-30
Occupational Title SOC Code Employment, 2020 Projected Employment, 2030 Change, 2020-30 Employment by Industry
Percent Numeric

SOURCE: U.S. Bureau of Labor Statistics, Employment Projections program

Insurance underwriters

13-2053 119,400 117,200 -2 -2,200 Get data

Contacts for More Information About this section

For more information about property and casualty insurance, visit

Insurance Information Institute

For more information about certifications, visit

The Institutes

The American College of Financial Services

National Association of Insurance and Financial Advisors

O*NET

Insurance Underwriters

Video