A Casualty Underwriter Career: Pros and Cons
Insurance underwriters assess risk and decide who to provide insurance to as well as insurance policy terms. Evaluate the pros and cons to determine if you want to start a career in underwriting.
|Pros of a Casualty Underwriter Career|
|Good pay (averaging nearly $70,570 as of 2014)*|
|Lenient education requirements (can enter the field with a bachelor's degree in any subject or experience in the industry)*|
|Option to specialize in personal or commercial insurance or various types of policies*|
|Work in a comfortable office setting*|
|Cons of a Casualty Underwriter Career|
|Low job-growth field (decrease expected of 11% from 2014-2024)*|
|Advancements in automated risk assessment software may phase out many aspects of the job*|
|Often requires certification, which can require extensive training and years of experience*|
|May require continuing education to keep up on constant changes in insurance laws and government regulations*|
Source: *U.S. Bureau of Labor Statistics
Job Description and Duties
As a casualty underwriter, you'll assess applicants to determine whether or not they're eligible for insurance that covers injuries, damages and other liabilities. The assessment process involves evaluating insurance applications and screening applicants according to a set of criteria, typically using a specialized computer program. If the risk of insuring a particular person is too high, you'll reject his or her application. If you approve the applicant, you'll write his or her policy to outline the insurance premiums and coverage amount.
You'll likely specialize in either personal or commercial casualty insurance, and you can even specialize in a particular kind of casualty policy. For example, you might be a commercial property natural disaster underwriter or a personal automobile insurance underwriter. Many insurance companies bundle multiple types of insurance, so you may need to be familiar with several kinds of risk assessment. Typically, you'll work a full-time schedule in an office setting, though you may travel occasionally to meet with prospective clients and assess risks on location.
According to the U.S. Bureau of Labor Statistics (BLS), employment in the insurance underwriting industry was set to decrease at a rate of 11% from 2014-2024. The sluggish growth is an effect of innovations in risk assessment technology that uses computer software to perform many of the risk calculations that underwriters once did by hand; however, underwriters are still needed to assess risk according to these automated calculations. Underwriters with finance backgrounds, communication skills and exceptional computer proficiency should experience the greatest job prospects.
As of 2014, insurance underwriters made a mean salary of nearly $70,570, according to the BLS. The bottom 10% of these workers made about $39,260, while the top 10% of underwriters made more than $113,010. A large majority was employed by insurance carriers; however, the highest-paid underwriters worked in the securities and commodity brokerage industry.
What Are the Requirements?
You generally need a bachelor's degree for this career. Employers may not require a degree in a specific major, though you might study a related subject, like finance or risk management. Even if you earn your degree in an unrelated major, you should still take courses in finance, business, math, economics and other applicable topics. Alternatively, employers may still hire you without a college education, as long as you have experience in the insurance industry and excellent computer skills.
What Do Employers Look For?
Employers want underwriters who understand the nature of risk. You'll need to know when the risk is high enough to justify increasing the insurance premium, and when it's so high that you'll need to deny the policy. This takes a mix of mathematical ability, industry know-how and decision-making skills. To give you an idea of what actual employers look for, browse through these samples of real postings from the March 2012 job boards:
- In Texas, a wholesale insurance brokerage firm advertised for a casualty underwriter with 2-5 years experience and at least some college coursework completed. Applicants needed excellent communication skills and had the option to work from home.
- An insurance company based out of Massachusetts needed a casualty underwriter to maintain and develop commercial accounts throughout the New England area. The employer required applicants to have excellent people skills and 5-7 years underwriting experience, including three years in mid-market commercial lines.
- Another Massachusetts insurance company was looking for a senior casualty underwriter to develop and maintain client relationships. As a senior employee, the underwriter would be expected to guide and mentor new and inexperienced underwriters. The ideal applicant has a bachelor's degree and five years of experience.
How to Stand Out in the Field
Obtaining underwriting certification is one way to boost your resume and catch the attention of potential employers. In fact, the BLS reports that employers often expect certification. The American Institute for Chartered Property Casualty Underwriters (AICPCU) offers several different types of casualty underwriting certification. For instance, you might earn the Chartered Property Casualty Underwriter (CPCU) designation by completing a series of courses and passing exams. You must have two years of experience within the last five years to qualify for CPCU certification.
While not mandatory, continuing education can help you stay up-to-date on insurance law, government regulations and industry standards. The AICPCU offers a range of online continuing education classes specific to casualty underwriting, like personal auto, liability for medical professionals and flood insurance.
Other Careers to Consider
Insurance Sales Agent
If you want to work in insurance, but underwriting doesn't offer sufficient job prospects, consider a career in insurance sales, which the BLS projected would see faster-than-average job growth at a rate of 22% from 2010-2020. As an insurance sales agent, you'll sell the insurance policies that casualty underwriters help prepare. You may offer clients tips to minimize risk and make their policies more affordable. You can choose to work as independent agent or as part of an insurance firm's team. Although the job doesn't always require formal education, insurance policy sellers must be licensed by their state. The BLS reports that insurance sales agents made a mean salary of about $63,000 as of 2011; however, many are paid by commission, and salary can vary according to your sales skills.
If you want a non-insurance-related job that still involves risk assessment, you may enjoy working as an actuary. In this career, you'll analyze statistical data for a company or organization to determine the potential costs of certain incidents, like accidental deaths or disasters, and develop ways to minimize risk. Most employers require actuaries to hold bachelor's degrees and professional certification. According to the BLS, employment of actuaries was projected to grow much faster than average (27%) during the 2010-2020 decade, and these professionals made a mean salary of $103,000 as of 2011.