underwriting Definition
- 1the process of assessing the risk of insuring a particular person or asset and setting an appropriate premium
- 2the process of guaranteeing a loan or investment by buying all or part of the issue of securities
Using underwriting: Examples
Take a moment to familiarize yourself with how "underwriting" can be used in various situations through the following examples!
Example
The underwriting process involves evaluating the applicant's financial history and health status.
Example
The bank is responsible for underwriting the loan.
Example
The company hired an underwriter to manage the underwriting process for their new stock issue.
underwriting Synonyms and Antonyms
Synonyms for underwriting
Phrases with underwriting
underwriting standards
criteria used to determine whether an applicant qualifies for insurance or a loan
Example
The bank has strict underwriting standards for approving loans.
a fee charged by an underwriter for guaranteeing a loan or investment
Example
The underwriting fee for the bond issue was 2% of the total value.
the difference between the price paid by the underwriter for securities and the price at which they are sold to the public
Example
The underwriting spread for the IPO was 5%.
Summary: underwriting in Brief
Underwriting [ˈʌndərˌraɪtɪŋ] refers to the process of assessing risk and setting premiums for insurance or guaranteeing loans or investments. It involves evaluating financial history and health status, and adhering to strict underwriting standards. Examples include 'The bank is responsible for underwriting the loan,' and 'The company hired an underwriter to manage the underwriting process for their new stock issue.'
