What is the primary task of the underwriting department in an insurance company?

The primary task of the underwriting department in an insurance company is to select risks to insure. Underwriters evaluate applications for insurance coverage by assessing the risks associated with insuring individuals or entities. This involves analyzing various factors, such as the applicant's history, the nature of the risk being presented, and other relevant data. The goal is to determine whether the risk is acceptable and at what premium the insurance should be offered.

By carefully selecting which risks to accept and setting appropriate terms, underwriters help maintain the financial stability of the insurance company, ensuring that it can meet its obligations to policyholders. This vital role helps the company balance risk and profitability, ultimately contributing to its ability to provide coverage effectively.