Associate in Commercial Underwriting (AU): Meaning, How It Works

What Is an Associate in Commercial Underwriting (AU)?

An Associate in Commercial Underwriting (AU) is a professional credential awarded to a financial professional qualified to evaluate risk for commercial insurance companies. These risks include losses that stem from insurance coverage provided to protect against future financial loss from injury, illness, property damage, or liability for the losses of others.

Insurance underwriters review applications for insurance coverage. They evaluate the potential risk, and accept, reject, or modify the policy according to law or company standards.

Understanding Associate in Commercial Underwriting (AU)

The AU is awarded by The Institutes, a financial education and credentialing organization, upon successful completion of an in-depth self-study program and passing national exams. The program leading to this designation is designed for agency and company underwriters, field representatives, and account managers, and requires a working knowledge of insurance principles and coverages.

The AU designation is a program that complements commercial underwriting skills learned on the job. The term underwriter derives from financial bankers who would accept some of the risk on a given venture, historically a sea voyage. In exchange for a premium, they would write their names under the risk information which was written on a slip created for this purpose.

Today, insurance underwriters are professionals who evaluate and analyze the risks of insuring people and assets and establish pricing for accepted insurable risks. Underwriters help price life insurance, health insurance, commercial liability insurance, and homeowners insurance.

AU Course Requirements

According to The Institute, the first step toward earning the AU designation is to pass four "core" courses covering:

• Commercial insurance
• Commercial underwriting principles
• Underwriting commercial property
• Underwriting commercial liability

Meanwhile, in order to satisfy the ethics requirement, candidates must also pass Ethical Decision Making in Risk and Insurance. This course comes at no extra cost and is designed to help professionals acquire the decision-making tools to maintain ethical standards and preserve the public’s trust.

The average time to complete the AU course and all exams ranges from nine to 15 months, according to The Institutes. Once the qualification has been secured, certified AUs can, if they wish, take one additional module, AU 67: Strategic Underwriting Techniques, to earn the Associate in Commercial Underwriting—Management (AU-M) designation.

The Institutes also offers the following professional designations, among others: Chartered Property Casualty Underwriter (CPCU); Associate in Risk Management (ARM); Accredited Adviser in Insurance (AAI); Associate in Reinsurance (ARe); Associate in Insurance Accounting and Finance (AIAF); Associate in Insurance Services (AIS); and Associate in Management (AIM).

Completing the AU program may grant you credits toward one or more of these other credentials.