Define: Underwriter

UK Accounting Glossary

Definition: Underwriter


Quick Summary of Underwriter


A person who examines a risk, decides whether or not it can be insured, and, if it can, works out the appropriate premium to be charged, usually on the basis of frequency of past claims for similar risks.




What is the dictionary definition of Underwriter?

Dictionary Definition


  1. A person who examines a risk, decides whether or not it can be insured, and, if it can, works out the appropriate premium to be charged, usually on the basis of frequency of past claims for similar risks.
  2. A financial institution, typically a merchant bank, that guarantees to buy a proportion of any unsold shares when a new issue is offered to the public (IPO).
  3. A person who provides a guarantee for a financial transaction.

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Full Definition of Underwriter


A person who examines a risk, decides whether or not it can be insured, and, if it can, works out the appropriate premium to be charged, usually on the basis of frequency of past claims for similar risks.

Underwriters are usually either employed by insurance companies or are members of LLoyd’s.

The name arises from the early days of marine insurance, when a merchant would, as a sideline, write his name under the amount and details of the risk he had agreed to cover on a slip of paper.

A financial institution, typically a merchant bank, that guarantees to buy a proportion of any unsold shares when a new issue is offered to the public (IPO).

Underwriters typically work for a commission, and a number may collaborate together in order to buy all the unsold shares, provided that a minimum subscription stated in the prospectus has been sold to the public.

A person who provides a guarantee for a financial transaction.


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Underwriter. PayrollHeaven.com. Payroll & Accounting Heaven Ltd. November 19, 2019 https://payrollheaven.com/define/underwriter/.
Chicago Manual of Style (CMS):
Underwriter. PayrollHeaven.com. Payroll & Accounting Heaven Ltd. https://payrollheaven.com/define/underwriter/ (accessed: November 19, 2019).
American Psychological Association (APA):
Underwriter. PayrollHeaven.com. Retrieved November 19, 2019, from PayrollHeaven.com website: https://payrollheaven.com/define/underwriter/

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This glossary post was last updated: 6th May 2019.