The concept of front office underwriting may sound like an oxymoron, but year after year, agents and other distribution channels are given more underwriting responsibility.

Many carriers, especially those who work through independent agents, have relied on their agents to do front-line underwriting for a long time, says Karen Pauli, analyst at TowerGroup Inc., Needham, Mass. “The carrier would put underwriting guidelines out there, educate the agents and expect the agent to underwrite the risk based on the requirements,” she says. “But, the real serious underwriting was done when the application hit the company. Carriers have extended the binding authority under the assumption that the agent would underwrite the risk up front, but now, from a personal-lines standpoint, the leading carriers have so much technology loaded behind the application process that it’s almost instantly underwritten.”

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