You've reached the end of this Introduction to General Insurance Underwriting online unit.
Please keep the following points in mind:
- Underwriting is the technical aspect of conducting the business of insurance.
- Insurers may accept both above standard and below standard risks.
- Insurability criteria include the following:
- the potential loss must be fortuitous
- there must be adequate numbers
- the chance of loss must be assessable.
- A risk may be deemed uninsurable if it is:
- against the public interest
- beyond the capacity of insurers.
- If a risk is deemed insurable, underwriters can approach it in one of two ways:
- individual risk underwriting—underwriting risks on a case-by-case basis
- portfolio underwriting—underwriting a large number of risks (or similar product types).
- The terms and conditions of risk acceptability are formally recorded in a policy document.