We often hear the description of underwriting manager being bandied about – but what exactly is an underwriting manager and how does he or she feature in the world of business insurance or that of other short-term insurance cover?
In the insurance world, underwriting refers to the signature of and the ability to accept liability as well as the agreement of payment in the event of loss and damage.
Underwriting is usually provided by large financial institutions such as insurance service providers, banking institutions as well as investment houses.
The name was derived from Lloyd’s of London who are financial bankers which have historically accepted risks on certain ventures (especially sea journeys and the risks that were associated with ships such as vessels being wrecked) – this was in exchange for premiums where the names were written under the information of the risk created specifically for this purpose.
- An underwriting manager is an individual capable of underwriting and issuing a financial product to consumers in the form of short-term insurance policies as defined in the Short Term Insurance Act by virtue of an authority, consent or right that has been approved to such an individual in terms of a written agreement entered into by such a person with a short term insurer or a Lloyd’s underwriter and who is authorised to carry out short-term insurance business in SA.
- Furthermore an underwriting manager’s sole remuneration is derived from these activities and is seen as being an agent of the short term insurer or Lloyd’s underwriter.
- An underwriting manager’s acts will be binding upon the short-term insurer or Lloyd’s underwriter.
- An underwriting manager will receive premiums on behalf of the short-term insurer or Lloyds.
- An underwriting manager will receive, pledge, bind and estimate the terms and conditions in respect of insurance business on behalf of the short-term insurer or the Lloyd’s underwriter.
- Your short-term underwriting manager will arbitrate, resolve, negotiate and agree on all claims on behalf of the short-term insurer or Lloyd’s underwriter.
- Furthermore, the underwriting manager will be able to offer services that would usually have been provided by a short-term insurer or a Lloyd’s underwriter.
Suffice to say, underwriting managers will always play an important role and will continue to feature as an integral part in the world of business insurance.
