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A life underwriter is an employee of an insurance company who assesses the risk of potential clients and decides whether or not to award a policy. This job requires the underwriter to review applications to fully understand a client's medical history. Underwriters also frequently consult experts to get a full picture of an applicant's health and use complex computer programs to aid in the life insurance assessment process. An underwriter must also be an expert on the insurance company's policies in order to either accept, reject or modify a proposed life insurance policy.
The first duty of a life underwriter is to collect and review applications for insurance coverage. This is a time-consuming process that involves closely monitoring the age, medical status and professional history of an applicant. Underwriters often contact applicants for clarification if needed. Life underwriters look for signs of risk in an application, such as health problems or dangerous professions that could lead to the policy being cashed in early.
If a question arises during the application review process, a life underwriter might require an expert consultation to acquire a fuller picture of an applicant's risk. Calling upon a medical professional is a common way of better understanding a complicated medical history that an underwriter is unsure about. The underwriter must take meticulous notes and add these comments to the applicant's file. Other professional consultants, such as psychologists or specific job experts, also may be consulted.
Computer programs that help assess risk are a major part of the life underwriter job. Modern insurance providers utilize sophisticated software to help make decisions. It is the underwriter's responsibility to fully understand how to best use these tools. Inputting risk factors, such as age and medical factors, is important. Knowing how to properly read the results and make a decision based on these factors is a critical function of the underwriting business.
A successful life underwriter knows the life insurance company's various policies. This requires the policies to be read and the underwriter to have an intimate knowledge of technological insurance terms and legal wording. This expertise aids in evaluating the risk of an applicant.
With all information properly collected and reviewed, a life underwriter must make a final decision. If an applicant does not pose a risk of cashing out a policy early, the application is accepted. If the applicant is too great a risk, the policy is rejected. In many cases, the underwriter makes amendments to modify the policy to compromise on the insurance decision.