What Is an Underwriters Association?

An underwriters association is an industry group dedicated to maintaining and providing continuing education and networking opportunities for people in the underwriting profession—generally, those in the insurance industry. parties that evaluate and assume another party's risk in a financial transaction or investment, in return for a fee. These associations are generally nonprofit entities funded by membership dues.

Key Takeaways

  • An underwriters association is an industry group for professionals in the insurance underwriting business.
  • Underwriter associations are generally nonprofit entities funded by membership dues.
  • Underwriter associations offer members a variety of professional development, educational and networking services, along with special perks for members.
  • Underwriters associations also conduct advocacy efforts at the state and federal government levels with the goal of advancing the interest of insurance professionals.

Understanding Underwriters Associations

An underwriters association offers members a variety of professional development services. These typically include online learning seminars, discounts on attendance at professional conferences, discounts on subscriptions to various publications, and business development tools. While underwriters play a critical role in many industries in the financial world, associations are generally geared towards insurance underwriters.

Typically either regional or national in scope, underwriters associations conduct advocacy efforts at the state and federal government levels with the goal of advancing the interest of insurance professionals. In this sense, they are similar to other professional organizations like the American Medical Association (AMA) for doctors, the National Bar Association for lawyers, and the Modern Language Association for humanities professors.

In the U.S., some of the largest underwriters associations include the Group Underwriters Association of America (GUAA), for the group insurance industry; the National Association of Health Underwriters (NAHU), for the medical insurance industry; and the Community Association Underwriters (CAU), for the real estate/property insurance industry.

In the U.K., the International Underwriting Association (IUA) advocates on behalf of aviation, marine and property, and casualty insurance and reinsurance companies. Based in London, their mission has evolved over the years from when they were primarily a strategic lobbying organization to their modern-day priority on providing support and services to members.

Examples of How Underwriters Associations Work

Like other trade or professional organizations, underwriters associations operate on several levels. While they serve their members with educational and networking opportunities, they also represent their field to government officials and policymakers, serving as lobbyists and public relations reps.

The IUA and Brexit

A recent example of the value of underwriters associations in helping members navigate changing times: The leadership role the International Underwriting Association (IUA) played during the United Kingdom's exit from the European Union, also known as Brexit.

In 2018, the IUA published guidelines and a sample policy contract clause to help companies navigate the many uncertainties brought about by Britain's exit from the EU and the resulting impact on existing deals and agreements. Called the Brexit Contract Continuation Clause, this clarification from the IUA was intended to help guide firms on issues around paying claims, thereby avoiding disruptions that could arise as the transition unfolded. Over the year, several other model clauses were published.

It was conceivable that some insurers that relied on the EU financial services passport for doing business with continental Europe may not be licensed on existing contracts after a Brexit deal is finally concluded. The new clause drafted by the IUA addressed this unintended consequence of Brexit, thereby allowing U.K.-based insurers to proceed with new business activities on the European continent.

The clause published by the IUA includes accompanying commentary outlining the various circumstances in which it may prove useful. While the clause is primarily intended for firms in the primary insurance business, it could also apply to reinsurers.

NAHU and Health Insurance

In 2019, some candidates vying to be the Democratic nominee for the 2020 presidential election, including Bernie Sanders and Elizabeth Warren, proposed a single-payer health insurance system for the U.S., colloquially known as Medicare for All. There are several different plans, but basically, all would replace the private insurance Americans get through their employers or other groups with a single point of purchase run by the federal government.

The National Association of Health Underwriters "strongly opposes all forms of single-payer healthcare" and has set up a web page for members to coach them on how to lobby against such plans. In addition to their stated philosophy that "when the free market and public programs work together [they] bring down the cost of care," they are also advocating against a change that could negatively affect the role and number of health underwriters in the U.S.