Underwrite: meaning, definitions and examples

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underwrite

[ˈʌndərˌraɪt ]

Definitions

^{Context #1 | Verb}

insurance industry

Underwrite means to assume financial responsibility for a risk or venture. In the insurance industry, underwriters evaluate the risk factors involved in insuring a person or asset and determine the premium to be charged.

Synonyms

back, guarantee, insure.

Which Synonym Should You Choose?

Word	Description / Examples
underwrite	Used in financial contexts, particularly when referring to the act of agreeing to take on the risk of an investment or loan, often by a financial institution. The bank agreed to underwrite the company's $5 million loan. This project was underwritten by a leading investment firm.
insure	Specifically refers to providing insurance, which means offering financial protection against potential future losses or damages. It's important to insure your house against fire and theft. They insured their new car with a comprehensive policy.
guarantee	Used when someone or something assures the fulfillment of a condition or the quality of a product. It implies a promise or assurance, often formal or legal. The manufacturer guarantees that all their products are free from defects. I can guarantee you will love this book.
back	Commonly used in general language when someone supports or funds a project, person, or idea. She decided to back his new business venture. The charity event was backed by several local businesses.

Examples of usage

Insurance companies underwrite policies to determine the level of risk involved.
The underwriter decided to approve the insurance application based on the risk assessment.
The underwriting process involves assessing the likelihood of a claim being made.
Investment banks also underwrite securities offerings for companies looking to raise capital.
Underwriting involves analyzing data to make informed decisions about risk.

^{Context #2 | Verb}

finance

In finance, underwrite refers to the process of guaranteeing a minimum level of proceeds from a security offering. Underwriters commit to purchasing unsold shares to ensure the success of the offering.

Synonyms

finance, fund, support.

Which Synonym Should You Choose?

Word	Description / Examples
underwrite	Typically used in financial settings where a party, often an insurance company or a financial institution, agrees to take on the financial risk for an event or investment. The bank decided to underwrite the new housing development project. The insurance company will underwrite the policy for natural disasters.
finance	Used when providing the funds necessary for a specific project, business, or purchase. It is often seen in both personal and corporate contexts. They needed a loan to finance their new car. The government plans to finance several infrastructure projects next year.
fund	Commonly used to describe the allocation of money or resources towards a particular purpose, such as a project, organization, or event. It is usually in a formal or official capacity. The startup is looking for investors to fund their innovative app. The charity event was funded by several local businesses.
support	A more general term that means providing assistance, which may include financial help, but can also encompass emotional or logistical support. It is versatile across different situations. Her family supported her decision to study abroad. The company supports various environmental initiatives through donations and volunteer work.

Examples of usage

The investment bank underwrote the initial public offering to provide financial support.
Underwriters play a crucial role in ensuring the success of new stock offerings.
Companies rely on underwriters to help them raise capital through the sale of securities.

Interesting Facts

Etymology

The term comes from the practice of signing the bottom of a document, highlighting one’s agreement to take on financial responsibility.
It first appeared in the late 17th century, evolving from the term 'underwriter' in shipping risk assessments.

Finance

Underwriting is essential in the insurance industry to evaluate risks and determine how much coverage to offer.
In the world of finance, underwriters assess the viability of loans and securities before they are issued, ensuring they are financially sound.

Real Estate

In real estate, underwriting helps lenders decide whether to grant a mortgage, factoring in property value and buyer creditworthiness.
The process involves detailed analysis of property conditions and market trends to mitigate financial risk.

Pop Culture

The role of an underwriter has been depicted in films and shows, often showcasing the tension between risk and reward in financial decisions.
Many financial thrillers reference the implications of underwriting in high-stakes scenarios like stock market crashes or insurance claims.

Historical Context

In the early 20th century, the underwriting process became more formalized, with the establishment of regulatory bodies overseeing practices.
Key events, like the Great Depression, led to stricter underwriting guidelines, shaping modern financial stability measures.

Translations

Translations of the word "underwrite" in other languages:

🇵🇹 subscrever

🇮🇳 अंडरराइट

🇩🇪 versichern

🇮🇩 menjamin

🇺🇦 гарантувати

🇵🇱 ubezpieczyć

🇯🇵 引き受ける

🇫🇷 souscrire

🇪🇸 suscribir

🇹🇷 sigortalamak

🇰🇷 인수하다

🇸🇦 يكتتب

🇨🇿 pojistit

🇸🇰 poistiť

🇨🇳 承保

🇸🇮 zavarovati

🇮🇸 tryggja

🇰🇿 сақтандыру

🇬🇪 დაზღვევა

🇦🇿 sığortalamaq

🇲🇽 suscribir

Word Frequency Rank

Positioned at #22,160, this word is part of extensive vocabulary. It's relatively rare in general usage but may be important in specific fields or formal writing.

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22157 jailer
22158 interrogatory
22159 saturate
22160 underwrite
22161 unfathomable
22162 vignette
22163 sacredness
...