The main distinction between insurance brokers or advisers and underwriters is that brokers/advisers represent the insured, while underwriters work for the insurer. Underwriters, who may be an Underwriting Agency, Lloyd’s Coverholder, APRA-regulated insurer, or an Unauthorised Foreign Insurer, assess risks and set coverage terms and costs. They are crucial in determining whether insuring a client is profitable for the insurer while safeguarding the company’s financial health.

The primary responsibilities of an insurance underwriter include to:

Assess Risks                   Determine Coverage                   Set Premium Rates

They scrutinise various factors to decide whether to offer insurance and under what terms. Their expertise ensures that the insurance company can cover claims and expenses. Underwriters work in different areas, spanning life, health, property, and casualty insurance, each requiring specialised knowledge and skills.

How Does an Insurance Underwriter Work?

When an insurance application reaches an underwriter, they start by gathering information about the applicant’s business, location, and claims history to assess risk. They may also consider industry-specific data and adhere to Australian financial service laws and the General Insurance Code of Practice. Based on this assessment, the underwriter sets the coverage terms and premium rates to ensure the insurance matches the risk level.

The Role of Insurance Brokers or Advisers

As an insurance broker or adviser, we represent your business, not the underwriter. Unrestricted by any single insurer, we find the best policies for your needs and leverage our expertise to navigate insurance complexities. We offer a range of options, advocate for you during claims, and ensure you receive your entitled benefits.

Connecting Underwriters and Brokers or Advisers

Insurance underwriters and brokers or advisers work together to offer comprehensive insurance solutions. Here’s a key difference: