Chapter 10 - C 120

Terms	Definitions
What personal qualities or characteristics tend to be held in common by underwriters who succeed in and enjoy their work?	curiosity, positive attitude, adaptability, motivation, creativity, customer focus
What phrase is used to describe the importance of curiosity to an underwriter?	"the power of why?" is used to describe the curiosity of the underwriter.
Why is it essential for an underwriter to strive to gather as much information as possible about a risk?	the more information, the greater the clarity towards accepting or rejecting a risk
Explain the connection between uncertainty and stress.	uncertainty causes stress. the more certain things are, the less stress there is.
Why should an underwriter avoid developing an overly negative attitude toward risk?	a negative attitude towards risk results in restrictive terms which leads to reduced premium volume and lower profits.
Why should an underwriter avoid developing an overly positive attitude toward risk?	an overly positive attitude may result in a greater number of premiums but lead to greater losses and lower profits.
Why does an underwriter need to be able to adapt to change?	nothing stays the same so the underwriter must be able to adapt to changing circumstances. e.g. market cycles
Why must an underwriter be a self-starter?	the underwriter must determine what needs to be done to improve or maintain their portfolio and satisfy the needs of their clients. Waiting for their superiors permission may make them a burden and inefficient.
How does an underwriter reach the best decision for a unique risk?	the underwriter must try to consider each risk without preconceptions.
Why should an underwriter remember to focus on customers?	focusing on the needs of internal customers (brokers, claims etc) builds greater working relationships whereas focusing on external customers builds loyalty.
Explain the significance of the phrase "you're not a real underwriter until you've suffered your first million-dollar loss."	it acknowledges that no amount of information and analysis before accepting a risk can guarantee that the risk will not suffer a loss.
What is "paralysis by analysis?"	it is the tendency to let the desire for more information about a risk defeat the need to make a decision about the risk.
What is empathy?	is the ability and inclination to "put oneself in the shoes of another"
Why is empathy important to an underwriter?	it allows them to build perspective on the problems of others they must work with to achieve underwriting goals.
How is goodwill created?	goodwill is created through good communication.
What factors influence an underwriter's communication style?	the communication style may be influenced by corporate philosophy, underwriting guidelines, market conditions and their own personality.
What is the difference between the role of an underwriter in the insurance transaction and the role of a broker?	they do not share common interests. the underwriter is protecting the insurer's loss ratio and the broker is looking to obtain the best insurance for the customer.
What is the "old boys' network?" How can such a network present a challenge to an underwriter?	its an informal network built over several years between members who climbed the corporate ladder to senior positions. It can be a challenge in that the broker could know more about the insurer's workings and direction than does the underwriter.
How can an underwriter soften bad news?	the underwriter owes the broker the courtesy of a written reply explaining the reasons for the bad news.
What should an underwriter pay attention to when communicating over the phone?	they should pay attention to the tone of the voice in absence of non-verbal clues as they risk communicating a different message than the one they intended.
What are some challenges of communicating via e-mail?	the priority of the message is unknown until read, they are inappropriate for situations that need a personal touch and privacy is a concern.
What makes the regions in Canada unique?	a large country has different exposures to natural disasters. Also, as a multicultural country, cultural and linguistic empathy must be taken.