WordValeunderwriting
assessing and assuming financial risk for a fee
In more detail
1. (noun) the business of examining insurance applications and deciding whether to approve them and what price to charge
2. (noun) the process of a financial company agreeing to buy newly issued stocks or bonds and then selling them to investors
3. (verb) to agree to pay for something if there is a loss or problem
Examples
- She works in underwriting at an insurance company.
- The bank handles the underwriting of new bond issues.
- The company will underwrite the cost of the event if it loses money.
How to use underwriting
Underwriting is a technical term primarily used in insurance and finance sectors. In insurance, it refers to the assessment of applicant risk before policy approval. In investment banking, it describes the guarantee to purchase and distribute securities. The verb form emphasizes the commitment to financial responsibility or support.
Common phrases
- underwriting standards
- underwriting process
- underwriting department
- mortgage underwriting
- underwriting criteria
- underwriting risk
Synonyms
insurance approval · risk assessment · financial backing · subscription · sponsorship
Word family
underwriter (noun) · underwritten (adjective) · underwrite (verb)
A common mistake
Learners sometimes confuse underwriting with underwriting a document (signing beneath), which is a different sense. They may also use the insurance sense when referring to investment banking context, or vice versa, without recognizing the distinct application.
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