Underwriting is the process by which an insurance company determines the level of risk that an insured poses. These factors are used to determine the appropriate rate of coverage. The process also helps determine the financial viability of an insurance company. An insurance business is legally required to have a statutory capital formula. The company’s capital is measured using the risk-based capital ratio.
To operate an insurance business in New York, insurers must have a valid license issued by the state. New York also has a number of additional requirements for insurers, including a “plan of operation” for the New York branch. Additional requirements may apply if the insurance business is conducted by an alien insurer.