What Is Chartered Life Underwriter?

Chartered life underwriter (CLU) is a professional designation for individuals who wish to specialize in life insurance and estate planning. Holders of the Certified Financial Planners (CFP) designation will often add CLU to their credentials to demonstrate additional subject-matter expertise. Individuals must pass a series of courses and examinations to receive the designation.

Understanding Chartered Life Underwriters

The CLU designation is one of the oldest and most respected credentials in financial services, dating back to the late 1920s. It represents a thorough understanding of a broad array of personal risk management and life insurance planning issues. The program also stresses ethics, professionalism, and in-depth knowledge when delivering advice in the areas of life insurance, business planning, and estate planning. Having additional knowledge in these areas gives financial planners a competitive edge over other planners with fewer credentials. 

Key Takeaways

  • Chartered Life Underwriter is a designation that shows expertise in estate planning, life insurance, and business planning.
  • CLUs must complete a series of courses and exams to earn the designation.
  • Many Certified Financial Planners add CLU to their credentials to demonstrate subject-matter expertise.
  • The American College of Financial Services confers the CLU designation and encourages holders to adhere to high standards.
  • CLU status can be revoked for misconduct.

According to The American College of Financial Services, which confers the CLU designation, financial professionals holding a CLU designation can average 51% greater income than their counterparts because they have the specialized skills to help clients. The program teaches many aspects of personal and business financial planning:

  • How to set and reach financial goals by analyzing the client's financial life and identifying life and health insurance needs as well as personal property and liability risks
  • Ways to achieve greater financial security through life insurance and annuity products
  • How to manage successful businesses with strategic organizational and preventive planning
  • Ways to enhance estate value, conserve existing assets, and provide for financial security during retirement

Qualifications for CLUs

The American College of Financial Services is an accredited non-profit educational institution founded in 1927. It has the highest level of educational accreditation—regional accreditation—through the Middle States Commission on Higher Education. The college has a full-time faculty of industry experts and is one of the leading educators of financial professionals in the United States.

To earn the CLU, individuals must complete five core courses plus three elective courses and pass eight 100-question, two-hour examinations. Required course titles include Fundamentals of Insurance Planning, Individual Life Insurance, Life Insurance Law, Fundamentals of Estate Planning and Planning for Business Owners and Professionals. Other course topics include financial planning, health insurance, income taxation, group benefits, investments, and retirement planning.

A Chartered Life Underwriter must adhere to The American College of Financial Services’ Code of Ethics, which includes the following professional pledge:

“I shall, in light of all conditions surrounding those I serve, which I shall make every conscientious effort to ascertain and understand, render that service which, in the same circumstances, I would apply to myself.”

Furthermore, maintaining the designation requires 30 hours of continuing education every year, and the designation may be removed for unethical conduct through the certification committee of The American College’s Board of Trustees.