Training, Certifications, Skills, Advancement: Insurance Underwriters

For entry-level underwriting jobs, most large insurance companies prefer college graduates who have a degree in business administration or finance, with courses or experience in accounting. However, a bachelor’s degree in almost any field—plus courses in business law and accounting—provides a good general background and may be sufficient to qualify. Because computers are an integral part of most underwriters’ jobs, computer skills are essential.

New employees usually start as underwriter trainees or assistant underwriters. They may help collect information on applicants and evaluate routine applications under the supervision of an experienced risk analyst. Property and casualty trainees study claims files to become familiar with factors associated with certain types of losses. Many larger insurers offer work-study training programs, lasting from a few months to a year. As trainees gain experience, they are assigned policy applications that are more complex and cover greater risks. These require the use of computers for more efficient analysis and processing.

Underwriting can be a satisfying career for people who enjoy analyzing information and paying attention to detail. In addition, underwriters must possess good judgment in order to make sound decisions. Excellent communication and interpersonal skills also are essential, as much of the underwriter’s work involves dealing with agents and other insurance professionals.

Continuing education is necessary for advancement. Insurance companies usually pay tuition for underwriting courses that their trainees successfully complete; some also offer salary incentives. Independent study programs for experienced property and casualty underwriters also are available. The Insurance Institute of America offers a program called “Introduction to Underwriting” for beginning underwriters, and the specialty designation, Associate in Commercial Underwriting (AU), the second formal step in developing a career in underwriting business insurance policies. Those interested in developing a career underwriting personal insurance policies may earn the Associate in Personal Insurance (API) designation. To earn either the AU or API designation, underwriters complete a series of courses and examinations that generally lasts 1 to 2 years.

The American Institute for Chartered Property Casualty Underwriters awards the designation Chartered Property and Casualty Underwriter, or CPCU, the third and final stage of development for an underwriter. Earning the more advanced CPCU designation takes about four years, and requires passing eight examinations covering risk management; insurance operations and regulations; business and insurance law; financial management; financial institutions; and a three course concentration in either personal or commercial insurance coverage. Although the CPCU may be mainly for underwriters, it is also meant for everyone working in all aspects of property and casualty insurance. The American College offers the Chartered Life Underwriter (CLU) designation and the Registered Health Underwriter (RHU) designation for all life and health insurance professionals.

Experienced underwriters who complete courses of study may advance to senior underwriter or underwriting manager positions. Some underwriting managers are promoted to senior managerial jobs. Some employers require a master’s degree to achieve this level. Other underwriters are attracted to the earnings potential of sales and therefore obtain State licenses to sell insurance and related financial products as agents or brokers.