Anyone who wants to become an insurance underwriter will need a bachelor’s degree in a relative field. The BLS states that most entry-level insurance underwriters receive on-the-job training from licensed professionals while they take exclusive classes to earn certifications. This includes the National Association of Insurance and Financial Advisor’s Life Underwriter Training Council Fellow (LUTCF), the American College of Financial Service’s Chartered Life Underwriter (CLU) and The Institute’s Chartered Property and Casualty Underwriter (CPCU) certification designations.
Certification Sample
The American College for Financial Planning, which is located in Pennsylvania, created the Chartered Life Underwriter (CLU) designation in the late 1930s for life insurance agents. Most insurance experts compare this credential to the Certified Financial Planner (CFP) certification for financial advisors. However, there is no difficult board exam that takes candidates a few attempts to pass. This comprehensive insurance-based education is maintained by approximately 100,000 insurance agents who work in every major insurance carrier in the country.
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This type of designation is designed for life insurance agents, brokers and wholesalers who sell life insurance services and products. This credential is even gained by bankers, stockbrokers, estate planners and tax professionals to enhance their marketability and increase their income by demonstrating in-depth life insurance knowledge. Anyone who maintains this designation will earn anywhere from one-fourth to one-third more than non-credentialed life insurance agents.
Certification Content
Certification programs train insurance underwriters how to effectively handle complex transactions related to estate planning, corporate deals and business taxation. These programs generally require the completion of five to six core courses and a three to four electives. Some of the most common required courses cover estate, business and individual life insurance planning. They may also cover industry standards, life insurance law and professional ethics. Elective courses may cover retirement, investment and health care insurance planning.
Other electives may include financial planning, management and problem solving processes. Each class will conclude with a final exam that must be passed before credit can be awarded. Once started, a course must be completed within a designated time frame, such as four years. Anyone who applies to these programs will need at least three years of pertinent, professional experience in the financial industry. Most insurance underwriters have backgrounds in banking, taxation, accounting and investments.
Professional Experience
Insurance underwriters must have appropriate employment experience to take certification programs and advance their careers. An entry-level underwriter will analyze new and renewal insurance applications to determine pricing, coverage eligibility and available terms and conditions. They must understand and adhere to the underwriting guidelines of their company and state. Underwriters will be expected to support ongoing client relationships and foster innovative initiatives to develop partnerships with new clients.
Underwriters will examine insurance applications and all associated documentation to determine whether to accept, decline or modify risks. They will calculate standard rates and condition charges from approved underwriting guidelines. They may decrease the policy’s value if risks are substandard and increase rates to applicable situations to ensure profitable risk distributions. They seek guidance when they must develop and modifies policy wording when standard text is inadequate.
Insurance underwriters who can adequate skills and knowledge may advance their careers to become property, business, health care and commercial title insurance underwriters. Anyone who wants to become an insurance underwriter can learn more about this unique career here.
