Frameworks over firefighting - Building a modern underwriting authority framework

In a fast-changing insurance landscape, underwriting governance is no longer just a compliance issue - it's a competitive advantage.

At the heart of strong governance sits the Underwriting Authority Framework: a clear, practical structure that defines who can write what risks, at what limits and under what conditions.

Without it, even the best underwriting teams risk portfolio drift, operational inconsistencies and profitability erosion.

Why Modern MGAs and Insurers Need a Structured Framework

In the early days of an insurer or MGA, underwriting authority might seem simple: "Experienced underwriters make good decisions."

But as you grow - whether organically, via acquisition or through delegated partnerships - complexity multiplies.

Different products, perils, clients and territories require a structured, scalable approach.

A strong authority framework achieves three critical outcomes:

• Portfolio Control: Ensuring risks align with appetite and strategic objectives.

  
  

• Underwriting Discipline: Providing clarity and consistency for underwriters at all levels.

  
  

• Regulatory and Reinsurance Confidence: Demonstrating robust controls builds trust with regulators, reinsurers and capacity providers.

What Makes a Modern Underwriting Authority Framework?

Clear Role-Based Delegations

• Authority tied to specific underwriting roles, not just individual experience.

• E.g., Assistant Underwriter vs. Senior Underwriter vs. Portfolio Manager.

  
  

Risk-Based Tiering

• Delegations vary by product line, peril type or exposure size.

• Higher CAT-exposed risks may require tighter controls or senior signoffs.

  
  

Monetary and Non-Monetary Limits

• Not just sum insured thresholds — also consider endorsements, wording variations, pricing flexibilities.

Referral Triggers and Escalation Paths

• Clear rules on when an underwriter must escalate or refer a risk (e.g. accumulations, atypical occupancy types).

Embedded Compliance and Auditability

• Easy to track who made what decision, under what authority, with auditable logs and periodic reviews.

  
  

Alignment with Risk Appetite Statements

• Your authority limits must directly support (and not contradict) your formal risk appetite documentation.

Common Pitfalls to Avoid

• One-size-fits-all frameworks that ignore product complexity or risk nuances.

  
  

• ‘Secret' delegations where experienced staff make informal exceptions.

  
  

• Static frameworks that aren't reviewed and refreshed regularly as portfolios evolve.

Final Thoughts

Building a modern underwriting authority framework isn't about restricting your underwriters - it's about empowering them to make faster, smarter and more profitable decisions within a disciplined structure.

At Storm Strategy, we help MGAs and insurers across Australia, New Zealand, and the Pacific region design practical, scalable authority frameworks - ensuring governance strengthens growth, not stifles it.

If you're ready to tighten your underwriting controls and future-proof your portfolio, we'd love to help.