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An underwriter is a finance professional employed by an insurance organization to evaluate the

risks associated with insuring individuals, organizations, businesses and assets. Based on this
risk evaluation the underwriter assigns an adequate premium to the insurance policy.Oct 28,
2015

Insurance underwriters use computer software programs to determine whether an applicant


should be approved. Insurance underwriters decide whether to provideinsurance and under
what terms. They evaluate insurance applications and determine coverage amounts and
premiums.
As an insurance underwriter you'll decide if applications for insurance cover (risks) should be
accepted and, if so, what the terms and conditions of that acceptance are. You will assess the
risk of insuring a person or company according to the likelihood of a claim being made.
Insurance underwriter: job description. ... Insurance underwriters analyse risk in insurance
proposals, determine policy terms and calculate premiums on the basis of actuarial, statistical
and background information. Most insurance companies run graduate schemes that offer a
route into underwriting.
To become an insurance underwriter, you typically need a bachelor's degree. However, some
employers may hire you as an underwriter without a degree if you have relevant work
experience and computer proficiency. To become a
seniorunderwriter or underwriter manager, you need to obtain certification.Feb 9, 2015
The underwriting process is an essential part of any insurance application. When an
individual applies for insurance coverage, he or she is essentially asking
theinsurance company to take on the potential risk of having to pay a claim in the future.

Who is an underwriter?
An underwriter is a finance professional employed by an insurance organization to
evaluate the risks associated with insuring individuals, organizations, businesses and
assets. Based on this risk evaluation the underwriter assigns an adequate premium to
the insurance policy. An adequate premium must generate a profit while also covering
anticipated losses and business expenses. Policies with a higher likelihood of loss (or
higher risk) are assigned a higher premium in comparison to lower risk policies with the
same insurance coverage.

In todays insurance environment most insurance companies implement computerized


underwriting systems which automate the underwriting process at the point of sale. This
is an automated computer program that groups insurance applicants by similar
characteristics and segments them into buckets, assigning each bucket a similar
policy premium.

What does an underwriter do?


If underwriting is performed by a computer, then what does an underwriter do?
One of the most important tasks of an underwriter is creating and developing the
underwriting guidelines. The underwriting guideline is a written manual specifying the
exact risks and characteristics of an insurance application that an insurance company is
willing to insure. For instance, the underwriting guideline might state that it will Reject
any auto insurance application where the vehicle is older than 30 years old.

The underwriting manual defines the rules by which the computerized underwriting
system uses to determine the appropriate premium for each policy and determines
which policies are accepted, rejected or flagged for manual review. Since the insurance
environment is constantly changing, the underwriter must frequently monitor and adjust
the underwriting manual to remain profitable. Using predictive models and trend
analysis to evaluate hundreds of thousands of data sets, the underwriter can determine
exactly which policies the insurer should accept and which prices create a profitable
business.

In some cases, the underwriting system flags a policy for manual review. A policy is
flagged when it is right on the edge of being accepted or rejected. In these cases, an
underwriter must manually review the policy to analyze the risk characteristics and
choose to accept, reject or modify the application. Many smaller insurance companies
still manually underwrite all of their insurance applications, meaning the underwriter
manually investigates and researches the risk of each insurance application to assign a
premium and choose to accept or reject the applicant.

Other underwriter tasks:

Review and analyze the customer base to evaluate trends in profit and loss
Recommend improvements to underwriting guidelines
Prepare underwriting reports
Provide underwriting advice to clients and insurance agents
Ensure compliance with government regulations
Work with marketing team to target profitable customers
Work with insurance agents to explain target market
Work with IT team to develop and improve underwriting systems

Requirements and tips for becoming an


underwriter
A career in underwriting typically requires a bachelors degree. A degree in business,
finance, economics, math or statistics is most desirable but insurers are typically open
to a data oriented applicant with an attention to detail from all fields of study. In addition
to a college education, anyone pursuing a career in underwriting should strongly
consider pursuing their underwriter certification. In the USA this is the CPCU
designation, in Canada this is the CIP designation. Although it is not required to become
an underwriter, it is extremely desirable and correlates with increased performance,
responsibility and salary.

Required skills:

Detail oriented
Investigative nature
Ability to analyze and investigate large amounts of data
Ability to reach sound decisions with supporting data
Ability to coordinate and organize complex tasks

My life as an underwriter
As an underwriter myself for a number of years, I truly enjoyed the analytical and
investigative nature of the career along with the opportunity to be an integral part of the
insurance environment where my decisions directly impacted the performance of the
company.

As an underwriter you really get to see it all. My fondest memory as an underwriter


occurred while manually underwriting a new business application that had been
accepted by our computerized underwriting system but was very close to being
rejected. In this case, the policy required an underwriting review because the applicant
was requesting the maximum coverage limit for a home valued at $300,000. Now
usually this is an easy one. As long as the house is in good condition with no
outstanding exposures, its an automatic approval. But not in this case.I conducted
my typical investigation, reviewing the exposures and didnt find anything out of the
ordinary; no prior claims, one small dog on the premises (a Pomeranian Poodle), a
fenced in backyard, no kids, no pool, and no damage to the home. Everything looked
good, but I decided to do a quick view of the property using Google maps before I made
my approvalThats when, to my surprise, I could visibly see 12 Beware of Dog signs
posted around the entire property. 12 signs!!! Now Im not sure if youve ever seen a
Pomeranian Poodle, but theyre little fluff balls that could barely hurt a fly. So why the
heck would they need 12 Beware of dog signs around the house?!

That immediately threw up a red flag in my mind, either this applicant has the most
dangerous Pomeranian Poodle on the face of the earth, or they were lying about the
breed of their dog.

I immediately ordered an onsite inspection on the home so we could get a thorough


analysis of the property and confirm the dog breed. Come to find out the applicant did
not own a Pomeranian Poodle; they actually owned a Pit Bull, one of the most
aggressive dog breeds and a strict do not insure in our underwriting guidelines! Since
our underwriting guidelines clearly stated that we do not accept any homeowner
applications if the homeowner owns a Pit Bull (among other aggressive dog breeds), the
policy was immediately canceled.

This investigation led to further research into our homeowner insurance policies. Come
to find out, our computerized underwriting system did not require the insurance
applicant to validate the breed of their dog, leaving us exposed to loss caused by
applicants that lie about their dog breed. Based on this finding we created logic in our
computerized underwriting system that required a mandatory onsite inspection of all
applications that owned a dog. This helped us to better reduce the loss faced by dog
attacks and helped us to more accurately assign the appropriate premiums to dog
owning homeowners.

If youre looking for an interesting career in one of the most stable industries in the
world, where each day brings new thought-provoking analysis and investigation, I
strongly recommend pursuing a career as an underwriter. I loved it and you will too.

Types of underwriters
In this article I primarily focused on the career of an insurance underwriter, but thats not
the only type of underwriter position

Two other types of underwriter:

Bank underwriter
Investment underwriter

A bank underwriter, similar to an insurance underwriter, is responsible for analyzing


the risk of their customers. The difference is that a bank underwriter is analyzing an
individual or organizations application for a bank loan. The bank underwriter
investigates the applicants credit worthiness by reviewing the applicants credit
reports, employment history, salary and debt to income ratio. Based on the
underwriters evaluation of the applicant, a bank will choose to accept or deny the
applicants request for a loan.

An investment underwriter, just like an insurance underwriter and bank underwriter, is


responsible for analyzing and assessing risk. An investment underwriter works for an
investment bank and evaluates the risk of various business transactions such as
mergers, acquisitions, public offerings and refinancing. Based on the underwriters
evaluation, the investment bank will choose to pursue or not pursue the business
transaction.
Conclusion of underwriting agreement regarding

convertible bond issued by Group Lease PCL listed on

the Stock Exchange of Thailand

J Trust Group (hereinafter the Group) has decided to conclude an agreement to


underwrite convertible bond issued by Group Lease PCL (the Kingdom of Thailand;
Chairman & CEO, Mitsuji Konoshita; listed on the Stock Exchange of Thailand; SET
symbol GL; hereinafter GL) through its subsidiary, JTRUST ASIA PTE. LTD.

1.Purpose

On October 7, 2013, the Group established JTRUST ASIA PTE. LTD. (hereinafter,
JTA) to conduct business in fast-growing Southeast Asia. Through JTA, the Group
intends to apply its domestic business model, established in Japan and has been
the source of growth in retail finance, amusement business and real estate
business in overseas market. As a part of this effort, JTA decided to conclude
the agreement to underwrite convertible bond issued by GL, which is aggressively
conducting the hire-purchase financing business in the Kingdom of Thailand.
Through this transaction, we will proactively support GLs business expansion
utilizing our network and know-how.
GLs core business is motorcycle hire-purchase financing business in the Kingdom
of Thailand and the Kingdom of Cambodia and GL plans to conduct the same business
in other countries in Southeast Asia including the Lao People's Democratic
Republic. Through this transaction, the Group starts to invest in hire-purchase
financing business which will benefit considerably from the population growth and
economic expansion in ASEAN and other countries in the future and strives to
generate synergy through provision of financial support by group companies.

2.Overview

(i)GL
GL is a finance company founded in 1986 and operates mainly motorcycle hire-
purchase financing business in the Kingdom of Thailand. GL maintains high level
of profitability in motorcycle hire-purchase financing business whose competitive
environment in the Kingdom of Thailand is becoming increasingly tough. Recently,
GL has been expanding its domestic business by extending its sales channel in
northeast area and area surrounding Bangkok. Moreover, in 2014, GL acquired
Thanaban Co ., Ltd., the 5th largest player in the industry and has been
increasing its shares steadily. As a result, GL ranks 1st in number of new
contracts in 2014 in Thailand, based on GLs latest statistics.
On the other hand, under its new vision of To become the leading ASEAN Regional
Finance Company, GL entered other markets in Southeast Asia from 2012. In the
same year, GL acquired exclusive rights of Honda motorcycle leasing in the
Kingdom of Cambodia and has been rapidly expanding motorcycle hire-purchase
financing business of Honda motorcycles whose share exceeds 95% in the Kingdom of
Cambodia. Moreover, GL formed a strategic alliance with Siam Kubota Corporation,
a leading agricultural equipment manufacturer, to provide a financial lease
service in Cambodia from late 2013 and has been steadily increasing the number of
contracts.

(ii)Hire-purchase financing business in Southeast Asia and synergy with the Group

Strong economic growth is expected to continue in Southeast Asia, middle-income


class who uses hire-purchase financing to purchase motorcycles is also expected
to continuously increase and leasing business of products including agricultural
equipment has potential. Therefore, we believe that GLs core business, hire-
purchase financing business, will sustain rapid growth.

We aim to generate synergy through measures as follows: provision of financing by


PT Bank Mutiara Tbk., the Companys subsidiary in Indonesia, joint operation of
hire-purchase financing business in Indonesia, and partnership with group
companies in expanding business in Southeast Asia.

As such, we intend to further expand our business in Southeast Asia which is


expected to enjoy rapid economic expansion and population growth by acquiring
know-how of GL which has been aggressively conducting business in the region and
capitalizing on the Groups know-how in financial business and network.

(iii)Overview of convertible bond

(i) Issue price: USD 30,000,000 (3.6 billion yen, 1 USD = 120 yen)
(ii) Interest rate: 5%

(iii) Maturity : 3 years

(iv) Conversion price : 10 Baht per share (36.90 yen, 1 Baht = 3.69 yen)

(v) Number of shares after full conversion (planned) : 97,087,379 shares

(vi) Shareholding ratio after full conversion (planned) : 8.2%

3.Overview of GL

1. Trade name Group Lease PCL

2. Headquarters Kingdom of Thailand

3. Representative Mitsuji Konoshita

4. Business Hire-purchase financing business of motorcycle and agricultural equipment

1,449.79 million Baht (as of end December 2013)(approximately 5.36 billion yen, 1 Baht = 3.6
5. Capital
yen)

6. Date of establishment May 6, 1986

Engine Holdings Asia Pte.Ltd. 31.7%

Principal shareholder A.P.F. Holdings Co.,Ltd. 18.0%


and shareholdings(as
7. SIX SIS LTD. 15.5%
of end December
2013) Mr. Sutthipong Vesvarut 6.5%

Thailand Securities Depository Co, Ltd. For depositor 3.5%

Capital relationship None

Relationship with J Personal relationship None


8. Trust Trading relationship None

Relevant circumstances for related parties None

9. Operating performance and financial position for the past 3 years (unit : million yen )

December
December 2011 December 2013
2012

Net assets 4,988 5,869 8,


Total assets 8,622 12,802 20,

Operating revenue 3,294 3,540 5,

Net income 795 1,321

*1 Baht = 3.69 yen

4.Schedule

Resolution by Board of Directors regarding the March 6, 2015


conclusion of underwriting agreement
Conclusion of underwriting agreement Late March 2015 (planned)

GLs shareholders meeting to vote for resolution Late April 2015 (planned)
regarding issuance of convertible bond

Payment date Late April 2015 (planned)

5.Future outlook

The impact on the current fiscal years consolidated operating results is


insignificant.

(Reference)
i.Overview of J Trust Group

As a comprehensive financial group, the Group aimed at expanding its business in


various areas including financial business, real estate business, amusement
business and international business through aggressive M&A and purchase of
receivables. The Group possesses business foundation, know-how and human
resources in consumer finance business. Nihon Hoshou, J Trusts
subsidiary, assumed the consumer finance business from Takefuji Corporation
(current TFK Corporation), which used to be the largest consumer finance company
in Japan. Capitalizing on our know-how and human resources in retail finance, we
operate savings bank business, purchase and collection of NPL in South Korea. On
October 7, 2013, we established JTRUST ASIA PTE. LTD. in Singapore to conduct
business in fast-growing Southeast Asia.
ii.Overview of J Trust

1. Trade name J Trust Co., Ltd.

2. Headquarters 1-7-12 Toranomon, Minato-ku, Tokyo

3. Representative Nobuyoshi Fujisawa, President and CEO

4. Business Holding business

5. Capital 53,592 million yen (as of December 31, 2014)

6. Date of establishment March 18, 1977

Nobuyoshi Fujisawa 25.30%


Principal shareholder
7. and shareholdings(as of TAIYO FUND, L. P. 9.45%
September 30, 2014)
NLHD Co., Ltd. (*) 6.28%

8. Operating performance and financial position for the past 3 years (consolidated, unit : million yen )

March 2012 March 2013 March 2014

Net assets 49,471 70,895 184,230

Total assets 117,546 218,706 334,736

Operating revenue 24,508 55,683 61,926

Ordinary income 5,486 13,704 13,351

Net income 34,500 13,309 11,145

* Nobuyoshi Fujisawa, President and CEO of J Trust owns all shares of NLHD Co.,
Ltd.

iii.Overview of JTRUST ASIA PTE. LTD.

1. Trade name JTRUST ASIA PTE. LTD.

2. Headquarters Republic of Singapore

3. Representative Nobuyoshi Fujisawa, Managing Director & CEO


4. Business Investment business & management support services

5. Capital 200 million Singapore dollars (approximately 16.3 billion yen)(as of December 31, 20

6. Date of establishment October 7, 2013

Principal shareholder and


7. J Trust Co., Ltd. 100.00%
shareholdings

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