Underwriting

Underwriting Definition

Underwriting may be defined as assuming the risk of having to pay insurance benefits, or buying the entire issue of stocks or bonds from a company for resale.

Meanings

For information on:

* organizations that underwrite insurance, see Reciprocals, Lloyd’s Associations and Lloyd’s Cooperatives

* calculations of underwriters regarding insurance rates and policies, see Actuary; Insurance: Risk Assessment; Marine Insurance

* contribution of insurance underwriters to fire safety by requiring compliance with building codes, see Building Acts

* underwriting securities, see Investment Banking

Main Source: “Underwriting,”Microsoft® Encarta® Online Encyclopedia

See Also

Maritime Insurance, Historical
Right or Abandonment in Marine Insurance, Historical
Abandonment and Total Loss in Marine Insurance, Historical
Insurance Regulations
Insurance Law Contents

Underwriting in Aging Law

Concept of Underwriting in the context of Community Health Care and Services for Older Persons, published by the World Health Organization (WHO):In insurance, the process of selecting, classifying, evaluating and assuming risks according to their insurability. Its purpose is to make sure that the insured group or individual has the same probability of loss and probable amount of loss, within reasonable limits, as the universe on which premium rates are based. Since premium rates are based on an expectation of loss, the underwriting process must classify risks into groups with about the same expectation of loss.