Magazine / Magazine
Underwriting agency, broker, insurer: who does what
An underwriting agency underwrites and settles under a carrier mandate. The carrier holds the risk, the agency makes the decision.
8 April 20266 min readNAMMERT Assekuradeur GmbH
The German word Assekuradeur has no tidy English equivalent. The closest is managing general agent, and the reason the term matters is that the three roles behind it get mixed up in everyday speech, while after a loss the difference is the whole story.
The insurer, properly the insurance undertaking, carries the risk. It needs authorisation from a supervisory authority and is subject to supervision. In Germany that is the BaFin, elsewhere in the EEA the national equivalent. Only an authorised undertaking may describe itself as an insurer.
The broker intermediates. It advises on the client’s instructions, obtains offers and accompanies a claim, but it decides nothing, because it holds no mandate from the carrier. In most European jurisdictions brokers appear in a public register, which is the quickest way to check who you are talking to.
The underwriting agency sits between the two and is the least known of the three. It acts under wide authority in the name of the carrier: it examines proposals, underwrites contracts, sets premiums and settles claims. It does not carry the risk; it makes the decisions.
In practice that means a call to an agency reaches the desk that decides rather than one that forwards. In a niche line such as boats that is the real advantage, because the technical knowledge sits in the same place as the authority. On a small inland boat it hardly shows. On a yacht in the eastern Mediterranean with rudder damage and no yard within sixty miles, it is the difference between a week and a month.
It also means the label has to be accurate. We are an underwriting agency and a broker, not an insurer. Our risk carrier is Wuerttembergische Versicherung AG. That is stated in the pre-contract information, in the mandatory disclosures and on every schedule we issue.
Common questions
Who pays after a loss?
Economically the carrier, as the party holding the risk. The examination, the decision and the payment run through the agency under its mandate.
Why may an intermediary not call itself an insurer?
Because the description is tied to the authorisation. An intermediary without authorisation may use it only with a clarifying addition, and in Germany a court has recently enforced exactly that.
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