How to become an underwriter in the UK
Updated 16 August 2023
Underwriters are responsible for ensuring there's balance between the risk that a company accepts and the premiums that policyholders pay. Underwriting is a profession that rewards those with strong skills of analysis, communication and focus. If you're interested in entering the field of underwriting, it's important to understand what to expect in terms of duties, requirements and qualifications.
In this article, we explain what an underwriter is and what they do, discuss some of the requirements needed to be an underwriter, describe their work environment, provide steps on how to enter the field, examine some career paths and look at how much you can expect to earn in this profession.
Please note that none of the companies, institutions or organisations mentioned in this article are affiliated with Indeed.
What is an underwriter?
An underwriter, also known as an insurance underwriter, is a professional who runs risk assessments on insurance applicants to determine a client's eligibility for coverage. They serve as the midway point between insurance companies and agencies to ensure that the company policies are being upheld at every level. Underwriters are responsible for reviewing the information on insurance applications, identifying potential risk factors that the client may present and comparing this information to what an insurance company deems acceptable for approval before finally determining whether the applicant should receive coverage.
Underwriters often specialise by type of insurance, such as:
Life: Life insurance provides financial support to beneficiaries in the event of the policyholder's death.
General: General insurance refers to policies that cover personal concerns outside of life insurance, including motor insurance, household insurance, pet insurance and travel insurance.
Commercial: Commercial insurance protects businesses from risks such as property damage, theft and income loss resulting from temporary interruption of operations.
Reinsurance: This is the practice of transferring part of the risk covered under a policy to another insurer so as to reduce the chances of paying out a large sum for a claim.
To determine an applicant's eligibility for insurance coverage, underwriters perform various tasks, including:
collecting and examining applicant information, such as medical records for life insurance policies
entering data into specialised software
calculating risk based on applicant information
determining the costs of premiums
negotiating policy terms between insurance brokers and policyholders
creating contracts and introducing conditions for policyholders to follow
How to become an underwriter
To become an insurance underwriter, you have to complete the necessary education and training requirements. Once you have started your career and gained more insights into the industry, there are additional opportunities for career advancement.
Follow these steps to guide you on your path to becoming an underwriter:
1. Choose a route
There are several routes you can choose to become an underwriter. These are:
The university route involves earning a degree in a relevant discipline, such as business, economics, maths or law. There are usually no specific degree requirements, but choosing a relevant degree subject can improve your candidacy for underwriting positions.
Work and apprenticeship are possible alternative routes if you don't have a degree. The work route entails taking on a junior role, such as that of assistant underwriter or insurance technician. After gaining sufficient experience, you can advance to an underwriting role by doing qualifications on the job according to your employer's requirements. As for the latter alternative, consider searching for available apprenticeships via government resources.
2. Consider a graduate scheme
If you're taking the university route, a graduate scheme may be an advisable path, as it can provide you with job experience as well as training under experienced underwriters. Large firms commonly offer graduate schemes in underwriting as well as related professions such as actuarial services. A minimum upper second-class honours degree can greatly improve your chances of acceptance onto a graduate scheme.
3. Gain work experience
On both university and non-university routes, relevant pre-entry work experience can help improve your candidacy for employment. Work placement programmes or internships are common among large insurance companies and can provide you with valuable on-the-job experience. An alternative to such programmes is taking a position in a separate role within a company. In this way you can work your way towards an underwriting job, should one become available. To find opportunities like this, consider directly querying insurance firms about their opportunities.
4. Consider professional qualification
A professional qualification can validate that you have an advanced understanding and aptitude in underwriting practice, leading to opportunities for advancement, such as into management, later in your career. The Advanced Diploma in Insurance, offered by the Chartered Insurance Institute (CII), is a well-known qualification. If you're taking the university route, your previous academic qualifications may be applied towards completion of the Advanced Diploma. Considering querying CII to learn more.
Requirements for underwriters
The requirements to become a successful underwriter entail more than education alone. An underwriter must have the necessary qualifications to fulfil their job responsibilities. The following skills are desirable for this profession:
Advanced computer knowledge
To be an underwriter, you need extensive knowledge in computer software and familiarity working with spreadsheet data. Underwriters might also need to complete risk assessments and other documentation in an online program.
An underwriter needs to be able to think analytically to interpret data. They must be experienced in examining data and measuring it against the insurance company's standards.
An underwriter should be able to effectively communicate with insurance companies and sales agents regarding a client's eligibility. A large part of an underwriter's job is to consult with industry professionals to come to a conclusion about a particular applicant.
The job of an underwriter requires making challenging decisions about insurance applicants. They have to consider the risks that a potential client presents to an insurance company in order to make the right decision. Sometimes, this requires denying an applicant coverage.
Ability to complete repetitive tasks
As this profession requires receiving, analysing and entering client data, an underwriter must be able to complete these tasks repeatedly and without error for each applicant they review.
Attention to detail
In conjunction with mundane tasks, an underwriter must pay close attention to the data they are analysing and be able to identify and correct errors on client documentation.
Ability to travel
An underwriter might receive an insurance application for a piece of property. In this case, it is their responsibility to travel to its location and conduct a risk assessment on-site. Travel could be an important part of this role.
Work environment for underwriters
Much of an underwriter's work takes place in an office setting. Typical work hours are 9 AM to 5 PM from Monday to Friday. As mentioned, travel is an occasional requirement, as underwriters must sometimes examine properties and other premises to assess risk. Other travel requirements may arise when having to meet with insurance brokers or other clients.
Though underwriting opportunities are widespread, many are concentrated in the major city centres. For underwriters of commercial insurance, there are often opportunities abroad, as many companies work with international clients or have locations throughout the world. Thus, some underwriters undertake international travel or live in other countries for periods of time.
Career paths for underwriters
From an underwriting position, there are numerous opportunities for career advancement. A natural path for an underwriter to take may be into the role of senior underwriter, which normally involves greater underwriting responsibilities such as helping junior underwriters to make decisions and training novice members in underwriting tasks.
Other career paths for underwriters include:
Average salary for underwriters
According to Indeed, underwriters in the UK earn an average annual base salary of £38,693 per year. Variables such as experience and qualifications can affect your earning potential. For example, an underwriting trainee can expect to earn significantly less than the annual average at £23,264 per year.
Location, too, plays a role in how much you can earn as an underwriter. For instance, underwriters who work in London, England, report average salaries that are higher than average, at £46,317 per year. On the other hand, those in Cardiff, Wales, report average salaries that are considerably lower than average, at £24,451 per year.
Salary figures reflect data listed on Indeed Salaries at the time of writing. Salaries may vary depending on the hiring organisation and the candidate's experience, academic background and location.
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