underwrite

verb
un·​der·​write | \ ˈən-dər-ˌrīt How to pronounce underwrite (audio) , ˈən-də-, ˌən-dər-ˈrīt, ˌən-də- \
underwrote\ ˈən-​dər-​ˌrōt How to pronounce underwrote (audio) , ˈən-​də-​ , ˌən-​dər-​ˈrōt , ˌən-​də-​ \; underwritten\ ˈən-​dər-​ˌri-​tᵊn How to pronounce underwritten (audio) , ˈən-​də-​ , ˌən-​dər-​ˈri-​tᵊn , ˌən-​də-​ \; underwriting\ ˈən-​dər-​ˌrī-​tiŋ How to pronounce underwriting (audio) , ˈən-​də-​ , ˌən-​dər-​ˈrī-​ , ˌən-​də-​ \

Definition of underwrite

transitive verb

1 : to write under or at the end of something else
2 : to set one's name to (an insurance policy) for the purpose of thereby becoming answerable for a designated loss or damage on consideration of receiving a premium percent : insure on life or property also : to assume liability for (a sum or risk) as an insurer
3 : to subscribe to : agree to
4a : to agree to purchase (something, such as security issue) usually on a fixed date at a fixed price with a view to public distribution
b : to guarantee financial support of underwrite a project

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Synonyms & Antonyms for underwrite

Synonyms

Antonyms

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Examples of underwrite in a Sentence

a university willing to underwrite an archaeological expedition
Recent Examples on the Web Proceeds support Medina Historic District and South Town and underwrite an educational series of training for small businesses and free community events on the Square. Marc Bona, cleveland, "Medina Beer Fest moving to larger location," 10 Feb. 2020 The industry is now actively working to change that by underwriting studies and even subsidizing academic journals in which to publish them. Popular Science, "There isn’t much science supporting wilderness therapy for teens," 30 Jan. 2020 Standing up to the Russians made sense in the Obama era, when America credibly underwrote a tough European line, but Mr Trump’s attitude to Russia and Ukraine is unclear. The Economist, "A thaw in EU-Russia relations is starting," 12 Oct. 2019 Supporters view tolls as a user fee that would partially be underwritten by out-of-state motorists. Rick Green, courant.com, "Leaked $21B transportation plan shows Lamont aims to fix highway bottlenecks, financed through federal borrowing and some tolls," 6 Nov. 2019 The ability to keep them fighting during that period of time had to be underwritten by a nation. Daily Pilot, "Old-fashioned propaganda visits O.C. fairgrounds for new exhibit," 3 Oct. 2019 At the event, researchers remarked that the cost of validating a biomarker for clinical use is still exceptionally high, meaning that work is mostly underwritten by large pharmaceutical companies – or not at all. Scientific American, "The Coming Age of Molecular Medicine," 2 Oct. 2019 Belichick has the means to massage both sides, overseeing the roster’s financial decisions that Kraft underwrites and crafting the gameday roster the Brady overshadows. Tara Sullivan, BostonGlobe.com, "It’s up to Bill Belichick to resolve the Patriots’ Tom Brady question," 12 Jan. 2020 The project has drawn the interest of a national foundation that may underwrite The Courier Journal's next phase of the project, more deeply explore CJNG's ties in the U.S., Puerto Rico, Mexico and Europe. Mike Trautmann, The Courier-Journal, "From El Mencho to Bevin's pardons: 10 Courier Journal investigations that defined 2019," 31 Dec. 2019

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'underwrite.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

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First Known Use of underwrite

14th century, in the meaning defined at transitive sense 1

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Time Traveler for underwrite

Time Traveler

The first known use of underwrite was in the 14th century

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Last Updated

18 Feb 2020

Cite this Entry

“Underwrite.” Merriam-Webster.com Dictionary, Merriam-Webster, https://www.merriam-webster.com/dictionary/underwrite. Accessed 25 Feb. 2020.

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More Definitions for underwrite

underwrite

verb

Financial Definition of underwrite

What It Is

Underwriting is the process that a lender or other financial service uses to assess the creditworthiness or risk of a potential customer.

Underwriting also refers to an investment banker's process of packaging and selling a security on behalf of a client.

How It Works

Underwriting refers to the structured process used by financial service companies, such as banks, investors, or insurers, to determine and price the risk from a potential client.  The underwriting process is a detailed and systematic analysis of a potential borrower's credit-worthiness, including employment history, salary, financial statements and performance, publicly available information, and independent credit reports.  The underwriting process is intended to determine the credit needs, the quality of the collateral assets to be used to support the borrowing, and the borrower's ability to repay the debt.  Upon completion of a formal underwriting process and a summary presented to a credit committee within the lender, the lender will either approve or reject the request for a loan.

Similarly, an insurance company will evaluate the risks of a potential candidate for insurance, based on a variety of actuarial factors.  The bottom line from such an underwriting process is to price the insurance in accordance with its associated risk.

In securities trading, underwriting also includes assessing the risk and pricing the security accordingly.  However, the formal underwriting process also involves agreeing to buy the security (by the underwriter) and then selling the security for a profit.  The underwriter effectively takes a risk by agreeing to buy the security at the established price.  In most instances, underwriters will line up buyers for the securities before they take on the security, so that it can "flip" the security to the buyer immediately.

Why It Matters

Underwriting is a critical step in the credit analysis and risk pricing process for almost all financial service companies.  For companies, understanding the underwriting process and the requirements at each stage of the process will allow a company to prepare and present itself accordingly.  For investors, the information contained in an underwriting is crucial to understanding the risks and potential rewards from a security's underlying asset.

Source: Investing Answers

underwrite

verb
How to pronounce underwrite (audio)

English Language Learners Definition of underwrite

formal : to give money to support (something, such as a new business) and agree to be responsible for any losses if it fails
technical : to agree to pay for a certain kind of loss or damage by offering (an insurance policy)
technical : to agree to buy (shares) that are not bought by investors when the shares are first offered for sale

underwrite

transitive verb
un·​der·​write | \ ˈən-dər-ˌrīt, ˌən-dər-ˈrīt How to pronounce underwrite (audio) \
underwrote\ -​ˌrōt, -​ˈrōt How to pronounce underwrote (audio) \; underwritten\ -​ˌrit-​ᵊn, -​ˈrit-​ᵊn How to pronounce underwritten (audio) \; underwriting

Legal Definition of underwrite

1a : to assume liability for (a risk) as an insurer the insurer underwrites individuals, not the group, in franchise health insurance
b : to issue or set the terms of (an insurance policy)
2 : to agree to purchase (all or part of a security issue) usually on a fixed date at a fixed price with the purpose or plan to resell by means of a public offering was a security brokerage firm which as part of its business underwrote speculative new issuesUFITEC, S.A. v. Carter, 135 Cal. Rptr. 607 (1977)
3a : to put up funds for or guarantee financial support of
b : to assess the risk of (as a loan)

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More from Merriam-Webster on underwrite

Thesaurus: All synonyms and antonyms for underwrite

Rhyming Dictionary: Words that rhyme with underwrite

Spanish Central: Translation of underwrite

Nglish: Translation of underwrite for Spanish Speakers

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