Magazine / Magazine: Policy and market
Underwriting agency, broker, insurer: who does what
An underwriting agency designs cover and settles claims under a mandate from the carrier. The carrier holds the risk. What the agency may decide depends on its mandate.
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: who does what.
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 a mandate from the carrier. Depending on that mandate it designs the cover, prepares contracts and settles claims. Some agencies may also accept risks on the carrier’s behalf, others may not. None of them carries the risk.
In practice that means a claim reaches the desk that settles it rather than one that forwards it. In a niche line such as boats that matters, because the technical knowledge sits in the same place as the claims 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 can decide how soon the repair starts.
It also means the label has to be accurate. We are an underwriting agency, not an insurer: we design the cover concepts; the risk carrier underwrites and settles claims. Contracts are placed through the broker Norman Nammert. Our risk carrier is Wuerttembergische Versicherung AG. That is stated in the pre-contract information and in the mandatory disclosures.
Common questions
Who pays after a loss?
Economically the carrier, as the party holding the risk. Where the agency holds claims authority, it examines and settles the claim 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.
Related
