Underwriting

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Underwriting

Acting as the underwriter in the issue of new securities for a firm.

Underwriting

1. The process of placing a new issue with investors. Underwriting involves the issuing company using one or (usually) more companies who are each responsible for placing a certain amount of the new issue. The underwriting firms contact potential investors to gauge interest and sell the issue. Underwriters guarantee the price for a certain number of shares of the new issue. See also: Bracketing, Oversubscribed, Undersubsribed.

2. Due diligence a lender conducts to ensure that a potential borrower is able to repay the loan.

Underwriting.

Underwriting means insuring.

An insurance company underwrites your policy when it agrees to take the risk of insuring your life or covering your medical expenses in exchange for the premium you pay.

An investment bank underwrites an initial public offering (IPO) or a bond issue when it buys the shares or bonds from the issuer and takes the risk of having to sell them to individual or institutional investors to recover its investment.

underwriting

the acceptance by a financial institution of the financial risks involved in a particular transaction, for an agreed fee. For example, INSURANCE COMPANIES underwrite INSURANCE risks such as damage to property paying out monies to policy holders wholly or in part to cover bona fide claims for compensation; MERCHANT BANKS underwrite new SHARE ISSUES, guaranteeing to buy up any shares that are not sold in the open market, and BILLS OF EXCHANGE. See LLOYDS, EXPORT CREDIT GUARANTEE DEPARTMENT.

underwriting

the acceptance by a financial institution of the financial risks involved in a particular transaction for an agreed fee. For example, INSURANCE COMPANIES underwrite INSURANCE risks such as damage to property, paying out monies to policy holders wholly or in part to cover bona fide claims for compensation; MERCHANT BANKS underwrite new SHARE ISSUES, guaranteeing to buy up any shares that are not sold in the open market.

Underwriting

The process of making a final determination on approval or rejection of a loan application.

Underwriting involves verifying the information that has been obtained from the borrower and that served as the basis for qualification, as well as assessing information on the applicant's credit worthiness.

References in periodicals archive ?

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Introduction

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Progressive Corporation has grown to become the largest writer of commercial auto business based on net written premiums, while also generating substantial underwriting profits.

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Under the deal, which was announced on 17 February, Helios acquired Updown Underwriting for a total consideration of GBP 0.6m (0.92m) in cash and 429,839 new ordinary shares in the company.

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By contrast, UMS Express can be deployed in as little as three months and provides rapid time to underwriting improvement.

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As chief underwriting officer for Public Entities, Manwaring will focus on expanding the practice focused on the complex risks facing K-12 school systems, government operations and higher education.

Liberty Mutual Names Chief Underwriting Officers for Excess Casualty and Public Entities

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United Kingdom : RSA appoints Rachel Conran as Chief Underwriting Officer

(formerly ACE Ltd.) in various senior roles, most recently as Chief Underwriting Officer of Chubb Tempest Re Group, Chubb's worldwide reinsurance operations.

David Drury and Steven Wilson appointed by Third Point Reinsurance

Insurance underwriters, using the underwriting process and various supporting underwriting tools, are employed by insurer to assess both their new and current business.

Purpose of Underwriting

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