Underwriting is the act of assuming a risk by insuring it, such as insuring life or property, or by agreeing to buy all or part of a new issuance of securities to be offered for public offering. It involves a financial institution (like a bank, insurance company, or investment firm) assessing, evaluating, and assuming the risk associated with a financial transaction, such as a loan, insurance policy, or securities issuance.
See also underwriter; insurance
[Last updated in July of 2024 by the Wex Definitions Team]