The digital age is here. Insurance must rebrand itself as a career and take a fresh approach to development to avoid a talent crisis.
Faced with an ageing workforce, digitalisation and stiff competition from rival industries, a generational talent gap is fast emerging in the insurance sector.
According to KPMG, as many as 40 per cent of insurance sector employees – including most senior, experienced and high-skilled staff – are set to retire in the next few years, with claims management, underwriting and reinsurance under particular threat.
If this mass exodus happens, there are currently not enough highly skilled younger practitioners to step into the shoes of outgoing senior managers, which would force companies to compete to buy in external talent and push up costs.
Meanwhile, graduates are being lured in their droves into perceived ‘sexier’ industries such as tech, with its forward-thinking work environments and opportunities to develop new skill sets. Against this backdrop, the insurance sector has never been under more pressure to rebrand itself.
KPMG says talent management is now a business-critical process for every organisation, advising insurers to “hardwire talent risk into their wider enterprise risk management frameworks”.
“As an industry we need to attract more young talent,” says Sarah Dunmore, Director of Talent and Development at JLT Group.
Offering opportunities to travel could be key, along with flexible working, training on the job or the chance to be involved in creating emerging products for example, it could help younger prospective employees to view the insurance sector as a more attractive career option.
And to improve retention, insurers could adapt talent development strategies to suit a more demanding generation of employees.
According to Dunmore, young insurers’ want career progression clearly defined by their employers; they are well travelled, willing to work overseas and want international experience; and they are much more willing to up and leave in search of better opportunities elsewhere in the industry.
“The next generation think differently to the one before. They want to know where they are heading, they expect career support, and will typically only stay in a role for a few years – they don’t have the same sense of loyalty as previous generations,” she explains.
In response, JLT has launched an initiative, ‘Unlocking Potential’, aimed at young talent who have been with the company for three to five years and may be considering their options.
“We want them to stay in the industry and with JLT. Bearing in mind how hungry they are for career progression and skills, the initiative aims to help them build self- awareness around their strengths, understand what they need to do to get to the next stage of their career, and broaden their skills beyond their area of expertise,” Dunmore says.
This can include, for example, learning about support functions such as IT, finance or communications, or developing soft skills such as networking, presentation or business knowledge. JLT also has a graduate scheme, offering potential employees the chance to enter the insurance industry.
This could lead to a permanent job in one of its specialist insurance divisions. The scheme highlights the importance of not following the crowd by joining something a bit different. As graduates at JLT put it: “A role in insurance is the best kept secret in the city.”
But getting graduates to take that first step into the insurance sector will require a fresh approach. KPMG suggests “deeply ingrained company cultures may need to change” in order to create an environment of innovation and collaboration.
This may mean overhauling long-established norms in the working environment, such as allowing flexible hours or working remotely by laptop, which is now common in many rival industries.
A new culture
For many lines of insurance, it may no longer be necessary to work exclusively from a desk, let alone walking distance from Lime Street.
However, while some in the insurance sector are opening up to new ways of working – Swiss Re, for example, has introduced ‘hot-desking’ spaces in its London headquarters – most remain wedded to the conventional 9-5 working week.
“Insurance is a traditional industry and there is still a stigma around flexible working; insurers and brokers usually kit their offices out with a desk for each person, and expect staff to come into the office each day,” says Dunmore. “This probably needs to change.”
Traditional approaches to training are also fast becoming a thing of the past, she notes. “There’s little point attending a course six months before you get to put those new skills to use, by which time you’ve forgotten what was learnt.
“Development will increasingly be delivered just in time, in flexible, bite-sized formats that can be accessed at the touch of a button.”
With this in mind, JLT aims to create an online training directory that will contain webinars, learning modules and other resources to help people learn in a flexible manner and at a time that suits them.
“We are also rolling out an initiative called ‘Growing Every Day’, which moves away from traditional annual appraisals to a much more dynamic way of setting objectives that drive business performance, measuring progress and giving feedback and support to help people with their career development,” Dunmore adds.
Embracing the digital revolution at every level of the insurance business will not only facilitate flexible working and on-demand learning – it will increase the appeal of insurance as a career for tech-minded youngsters.
The increased use of digital technology will almost certainly reduce the number of people needed in some roles in the workforce – particularly as certain standardised coverages become more automated. But it will also give young people with different skill sets a reason to enter insurance.
One of the key challenges the sector faces is redefining insurance roles for the digital world while ensuring the smooth transfer of traditional core insurance skills from seasoned practitioners to the next generation.
However, it is clear that young members of the industry still believe human relationships not only remain central to success in the insurance business, but also to the appeal of insurance as a career.
A careful balance must therefore be struck between embracing digital technology and preserving insurance’s unique relationship- based environment.
It is also essential that insurance looks not just into tech and other sectors for new talent but into more diverse demographic groups. According to Dunmore, there is still a stark lack of diversity in the talent pool, with new recruits often recommended by someone they know who works in insurance.
Widening the talent pool
While insurance graduate schemes get a strong pipeline of applicants, they are often heavily over-subscribed, with most graduates seeking work in London.
JLT is attempting to combat this by building relationships with academy schools to recruit school- leavers into apprenticeships at regional offices, helping to both nurture local talent and improve diversity.
“We need to make sure our employee base is representative of our diverse global client base,” says Dunmore. “Our clients have been recruiting people from different backgrounds longer than we have, and this is something we must do better.”
There is evidently much work to be done – from modernising the work and career development environment to promoting insurance careers to a wider audience – if insurance is to avoid being left behind in the digital age.
For further information please contact Sarah Dunmore, Director of Talent and Development at JLT Group on +44 20 7558 3353 or email firstname.lastname@example.org
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