Underwriting peer review
Review of an underwritten risk by another underwriter of the same competence, before or after commitment, to check the reasoning, price and clauses, a quality control required by the most demanding markets.
Peer review means having a competent underwriter who took no part in the decision examine a risk that has been, or is about to be, written. It differs from referral to higher authority, which concerns risks beyond a delegation, since it also covers risks well within the underwriter's limits. Its purpose is to check the quality of the decision: consistency of the risk analysis, adequacy of price relative to the technical premium, relevance of clauses and exclusions, respect for underwriting appetite, documentation sufficient for a third party to follow the reasoning. It can be prior, for large or unusual risks, or subsequent, on a sample chosen at random or by risk criteria. The most structured underwriting markets have made it a minimum standard, and supervisors see it as evidence of governance. Beyond control, peer review is a training tool and a way to harmonize practice: it spreads a common way of reasoning within the team and reveals individual drift before losses make it visible years later.
Textbook case: each month, a cyber underwriting team randomly selects 10 percent of the risks written and submits them to a colleague. Over one quarter, the review reveals that three risks accepted a time deductible below the policy minimum: the gap is corrected at renewal and the policy is restated to the team.
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