Underwriting refers to the process used to determine a potential clients' risk profile before selling them an insurance policy. It is the underwriters' job to ensure that there are enough funds available to settle all policies in the event of a mass claim. Underwriters are called such because in the early days of insurance, investment bankers would accept a portion of risk before a ship went on a voyage by writing their name under the risk information for a particular vessel. In exchange for carrying a portion of the risk, a premium would be paid to the underwriters. This was the very start of insurance as we know it today. The main underwriters in South Africa today include, in no particular order:
- Hollard Insurance
- Mutual and Federal
- Santam
- Auto and General