A recent survey by PwC found that nearly two-thirds of employees in the U.S., including executives, are looking for a new job. That number is stunning.
It suggests that insurers need to play some serious defense, to keep employees happy and on board and to keep competitors from poaching talent. But it also illuminates an opportunity to play offense. If lots of employees are looking for a new position, then, by all means, let’s go get the best we can.
As someone who chose to get involved with insurance eight years ago because of what I saw as a huge opportunity for digital innovation, I’ve always been struck by the industry’s inferiority complex. People talk about how they fell into insurance, rather than choosing it. Many talk about the industry as slow-moving and boring.
In fact, it seems to me that insurance combines a noble purpose with a great opportunity — a chance to use digital technology to “put a dent in the universe,” as Steve Jobs once memorably put it. As we’ve seen over the past several years, insurers are not just using technology to be more efficient but to make life easier for customers, whether buying a policy, requesting information or service or filing a claim. And we’re barely past the starting line. In time, I believe, the industry will be able to focus on preventing losses, rather than (the already important role of ) making people whole following losses. I also think insurance can play a key role in mitigating climate change by translating future risks into dollars-and-cents calculations today that will steer clients in the right direction.
So, why not take advantage of people’s current itch to reconsider their career choices? Why not make a pitch for people to enter the insurance field, where they can play a role in reinventing a multitrillion-dollar industry that provides the bedrock for all others by handling their risks?
As I said, we’ll all have to play defense, too. The PwC survey of 1,007 U.S. based employees and 752 executives found that many were in search of better salaries and benefits — benefits being a blind spot for many executives, who underestimated their importance to employees. The key ones cited in the report are: expanded flexibility, career growth, well-being and upskilling.
I’d underline the role of expanded flexibility, at least over the next year or so. I think many people will be swayed by what the work environment will be like once the pandemic finally recedes far enough for the vast majority of offices to reopen — with, I imagine, at least some flexibility to work remotely being a key desire.
And these concerns aren’t idle. Not only did 64% of those surveyed in August say they were looking for employment, up from 36% in May, but nine out of 10 executives said they were seeing abnormally high turnover in their organizations.
But I think insurance is already making bigger strides than most industries to become a more attractive place to work, in particular by continuously automating more and more of the entering (and reentering and checking and fixing and…) of the information that insurers require. And the trend is accelerating. So much more of the mundane work processing documents will be taken over by computers, freeing us humans to tackle far-more-fulfilling problems.
As an ITL thought leader wrote not long ago, it’s one thing to pitch prospects on a career of checking the fine print in a legal contract. It’s a whole other thing to tell them that we’ll equip them with the most advanced tools available to reinvent one of the world’s core industries.
Does the name Ned Ryerson sound familiar? Perhaps just vaguely familiar, but you can’t quite remember where you’ve seen or heard the name? I’ll give you a hint: BING! How about now? Still don’t remember? Did you see the Harold Ramis film, “Groundhog Day”? BING!! Remember the annoying insurance salesman who torments Bill Murray’s character, Phil Connors, every morning, claiming to have attended the same high school when they were kids? BING!!! Remember how he shouted his cheesy, personalized catch-word as he badgered Phil to buy nearly every type of insurance known to man? BING!!!! “Needlenose Ned”? “Ned the Head”? BING!!!!! That was Ned Ryerson. (I’ll spare you the catch-word this last time.)
For the five people on the planet who have not yet seen this comedy classic, a supernatural event forces a self-absorbed TV weatherman covering the annual Groundhog Day event in Punxsutawney, PA, to repeat the same day over and over again. Each morning, weatherman Phil Connors awakes on Feb. 2 and re-lives the same set of events, interacting with the same people, including the cringe-worthy Ned Ryerson. The first three or four times Phil encounters Ned, he does his best to avoid him. By their fourth encounter in the movie, Phil flattens Ned with a vicious punch before he can once again launch into his déjà vu sales pitch.
After repeating the same day for the hundredth, thousandth or possibly millionth time, Phil Connors undergoes a personal transformation from egotistical jerk to a kind, caring person, thus allowing the calendar to finally turn to Feb. 3. And, yes, part of that penance included a purchase of insurance coverage from Ned Ryerson. After all, what greater demonstration of humanity is there than to be nice to an insurance salesman?
Houston, We Have an Image Problem
Ned Ryerson is the fictional embodiment of nearly every insurance stereotype in a single person. Unable to turn his “whistling belly button trick” from the high school talent show into a professional career, he did the next best thing; insurance. He’s creepy. He’s annoying. He tells bad jokes that only he finds funny. He never takes a hint. He’s relentless. He displays many of the worst traits perceived in our industry, and, sadly, he is one of the more positive depictions of the insurance industry that has appeared on the big screen.
Consider the alternatives. In the Denzel Washington movie “John Q,” a desperate father holds a hospital wing hostage and forces doctors to perform a potentially life-saving surgery on his dying child because his insurance company will not authorize the procedure. “The Rainmaker,” a screen adaptation of the John Grisham novel, follows a lawyer suing an insurance company for denying a bone marrow transplant to a young man who later dies as a result of the company’s “deny all claims” directive. “Sicko” offers a scathing (albeit slanted) view of the American health insurance system that takes billions of dollars from individuals and then refuses to provide them coverage.
If we are to believe Hollywood, the insurance industry steals hard-earned money from people who can least afford to lose it, seizes every opportunity to deny benefits to those in need and condemns children to death to protect profits. By contrast, Ned Ryerson is practically the patron saint of the industry.
So what does Ned Ryerson have to do with the future of insurance? The Bureau of Labor Statistics projects the insurance industry will need to add nearly 200,000 jobs in the next five to six years to match projected demand. Brokerage firm Guy Carpenter projects that as much as 25% of the insurance industry will have reached retirement age by 2018. With so many stable, well-paying insurance careers available, it would seem the insurance industry should have no issues filling its employment coffers. And yet we do. In fact, we may be approaching a crisis-level talent gap. Why? Perhaps it’s because so few young people have had a positive introduction to the insurance industry. Maybe it’s because there are only a handful of universities offering insurance programs. Or just maybe, college students simply don’t want to envision their future selves as Ned Ryerson.
No Degrees of Separation
Insurance is one of the only major industries in the world that does not require or even encourage prospective employees to have an educational background in the field. There are insurance professionals who hold diplomas in English, finance, economics, liberal arts and a myriad of other disciplines but virtually no insurance degrees. When people learn that some universities offer insurance as a degree program, their reactions usually fall into one of two categories:
Sasquatch sighting: I’ve heard rumors such things exist, but I’ve never actually seen one in person.
Unstable personality concern: You mean people actually WANT to do this for a living? Perhaps these lost souls should consider seeking professional treatment for this condition….
Why is it so surprising that an insurance professional would have an insurance degree when it’s commonplace for others to hold degrees in their chosen fields? Attorneys attend law schools. Mechanics go to technical training schools. Doctors go to medical school. Why wouldn’t an underwriter or broker study insurance? Think about it. How would a patient react if he learned his neurosurgeon attended culinary school? Would an accounting firm hire someone who studied ballet? What if the electrician re-wiring your home offered his undergraduate degree in physical therapy as proof of qualification? Wouldn’t that be strange and possibly a little unsettling? Yet this is how most of the insurance industry operates.
Professionals with educational backgrounds outside of insurance aren’t necessarily less qualified than those with insurance degrees. There are many exceptional people in our industry who did not pursue insurance as a course of study but still found their way to an insurance career. Yet how many talented young people do we miss every year simply because insurance is not offered as a career choice at the schools they attend?
If we are to solve the long-term issue of youth and talent acquisition facing our industry, we will need to make insurance a more desirable and available option for college students. To do so, we need to help more colleges and universities across the country develop meaningful insurance programs. Unless the insurance industry supports college degree programs, students aren’t likely to consider insurance as a career path worthy of their time and talents
A Bridge Under Troubled Waters
According to a 2015 study published by Business Insurance, Temple University hosted the largest insurance program in the country with 475 undergraduate students in 2014. On the surface, this number may seem impressive but when compared with the enrollment in other courses of study and the projected needs of the insurance industry over the next few years, a very different picture emerges.
Of the nearly 28,000 undergraduate students attending this university in 2014, less than 2% chose insurance as a potential career; fewer than those pursuing music and dance. If we assume half of the undergraduates studying insurance would be graduating in any given year, this particular program would fill fewer than 1,200 positions over the next five years.
Gamma Iota Sigma, the insurance industry’s lone national professional fraternity, has active local chapters in just 50 of the 3,000 or so higher education institutions in the U.S. offering four-year degree programs. This means insurance is available as a course of study in just one out of every 60 colleges and universities across the country. In 2014, the top 20 schools offering insurance as a major had roughly 3,400 undergraduate students enrolled in those programs collectively. If the Bureau of Labor Statistics’ projections are correct and our industry will have about 200,000 jobs to fill within five years, there won’t be enough insurance graduates to fill the job vacancies left by those who are retiring, let alone the new positions.
To bridge this impending employment gap, our industry will need to look to other non-insurance graduates to fill the void. For some of these individuals, insurance will provide a challenging and rewarding career, but for others it will be an option of last resort. The best and brightest of those pursuing other fields of study will likely have found homes in their chosen career paths. Insurance will get the leftovers. If the insurance industry is to continue to evolve and improve at the same rate as those we insure, something will need to change.
The Lesser of Two Evils
In recent years, a great number of studies have been published on the attitudes, values and work ethics of millennials. A 2011 report issued by PricewaterhouseCoopers (PwC), Millennials at Work; Reshaping the Workplace, indicates personal development opportunities, organization reputation, work/life balance and opportunity to make a difference are some of the key factors millennials consider when choosing a job. Compensation was also a factor but was not among the top three criteria millennials used to make career choices.
The insurance industry would seem to meet most, if not all, of the essential criteria millennials use to judge prospective employers. There is an enormous opportunity for personal development and advancement for young people entering the insurance industry over the next few years. Likewise, many employers in the insurance industry have moved toward flexible working hours and work-from-home arrangements to accommodate a better work/life balance for their employees. Lastly, the insurance industry undoubtedly makes a difference for many people. Insurance allows people to buy homes, operate businesses and recover from life-threatening injuries without fear of possible financial ruin. It even helps people care for their families after they die.
If not for one glaring exception noted in the PwC study, the insurance industry would appear to be a nearly perfect fit for millennials seeking professional employment opportunities. But to quote the great sage Ned Ryerson, that one exception is a DOOOZY. When asked if there were any specific industries millennials would not consider based on reputation alone, insurance ranked second behind only the oil & natural gas industry. Even Ned would have a tough time spinning that one to a prospective millennial. You may hate us, but our carbon footprint is really small… How’s that for a rebuttal and recruiting pitch?
School is Back in Session
The reality for most insurance industry recruiters is that the battle for millennial talent historically was lost before it even began. Not only do we not have an extensive network of colleges and universities providing insurance as a course of study for incoming students but most prospective millennial candidates decided against insurance as a potential career option long before they even chose a college to attend. If the insurance industry is to reverse this trend and attract talented youth, we will need to develop a strategy to engage young people before they begin pursuing a profession.
Traditional career days and fairs at most high schools and colleges generate a relatively high attendance but typically offer little in the way of meaningful interaction with individual students. The likelihood of convincing someone to consider an insurance career in a two or three minute conversation is minimal. A guest lecture lasting 30 minutes (or more) provides much better odds. Many high schools now offer business classes as electives to their students. Some of these schools will occasionally invite guest lecturers from local businesses to speak in their classrooms. A guest lecture that presents an insurance career as a positive and challenging opportunity could be the first introduction to a rewarding career path for some students.
Not sure if your local high school offers business classes as part of the curriculum or if they allow guest lecturers into their classrooms? Why not pick up the phone and ask? We call on prospective clients nearly every day asking them to place their business with us. Shouldn’t we put forth the same effort to secure the future of our industry?
Supporting existing college insurance programs will also be a critical component to securing top notch talent in the future. For companies that want to participate in scholarship and grant programs without the administrative responsibilities of operating those programs, there are options available. Organizations like the Spencer Educational Foundation provide scholarships from donor companies and individuals to students pursuing careers in risk management and insurance. These scholarships provide real incentives for talented students to choose insurance as a career. Individuals can likewise help aspiring college graduates by participating in mentorship programs that pair graduating students with experienced professionals. Having a mentor available may make the transition from college to professional life easier and possibly improve the chances of those students remaining in the industry for the long term.
Lastly, while there are only about 50 colleges and universities with established insurance programs nationwide, that leaves about 3,000 opportunities to develop new insurance degree programs. It is likely that at least a handful of the multitude of retiring insurance professionals may simply be looking for a change of scenery rather than a complete departure from the working world. A new career as a college professor could be an option for some. If just one college in every state were to create a small staff of adjunct professors from the pool of retiring insurance professionals, the number of colleges in the United States offering insurance as a degree program would nearly double. This wouldn’t eliminate the talent gap on its own, but as Ned Ryerson would likely agree, it sure as heckfire would be a step in the right direction. Am I right or am I right?
With more than 70,000 expected U.S. retirees in 2017, the insurance industry faces an imminent talent crisis. Industry leaders have been eagerly searching for ways to recruit and attract young talent to replace the outgoing staff, but, due to poor industry perception, it remains an uphill battle.
The Insurance Careers Movement began as a grassroots, industry-wide initiative to combat the coming talent shortage and the ill-fated perception of the industry. We endeavor to empower young professionals who already work in insurance to share their feedback and experiences, educating their peers and students about the vast career opportunities available to them. As a part of the annual Insurance Careers Month each February, we conducted interviews with more than 30 millennials from a wide range of insurance carriers and agencies about their thoughts on the industry.
Contrary to the general perception outsiders have of insurance, findings from the interviews revealed that many younger workers view insurance as a dynamic field with significant opportunities for growth and development of personal relationships with customers and coworkers. In fact, their responses largely resemble the theme of the movement, referring to insurance as, “the career trifecta,” to emphasize the idea that pursuing a profession in insurance is stable, rewarding and limitless.
Here are the three recurring themes mentioned across all the interviews:
In many of the interviews, one of the distinct benefits of working in insurance is the extensive career options, and the flexibility to try different sections of companies. A recent graduate can begin with underwriting, then branch into marketing, risk management or any other career path she wishes to pursue.
The insurance industry holds a long, rich history and is in nearly every part of the world. Therefore, there is a vast number of opportunities available in many areas of the field, adding to the stability factor. Ashley Jenkins, controller at Pioneer State Mutual Insurance, said, “Insurance companies are very stable compared with many other industries. As an example, my current insurance employer and prior insurance employer did not have to lay off any employees during the major financial crises in 2008 and 2011.” Additionally, according to the National Insurance Brokers Association, the median salaries in insurance are all well above the national average at around $30,000 a year. With more than 75,000 jobs opening up due to retirement, members of younger generations are being afforded regular growth opportunities, promoting a stable career path that doesn’t exist in many fields; today’s young employee tends to change jobs four times before they’re age 32.
Although many jobs require employees to sit in cubicles, a career in insurance allows people to interact and cultivate relationships with other customers and coworkers. Koory Esquibel, TRAC risk analyst at Marsh, said, “One of my favorite parts about this industry, and the reason why it is so easy to recommend to students and new graduates, is the ability to form so many strong relationships with colleagues and business partners.” This is a pivotal time in insurance where improved employee and customer interaction is happening at all points of the workflow. Between mobile technologies to better interact with customers and analytics to improve speeds of underwriting and claims processes, the industry has never prioritized innovation so aggressively.
According to the survey conducted as a part of the Insurance Careers Movement, more than 92% of millennials working in insurance said that they are proud to work within the industry and want to promote the benefits and opportunities it provides. Their answers also revealed that millennials are already putting efforts into recruiting their peers, as 73% of respondents said that they have tried to convince at least one of their friends to choose a career in the risk management and insurance industry.
With the wave of digital innovation looming and new regulations and product offerings being created daily, the insurance industry is more dynamic than ever before. Employees at all levels, regardless of their areas of focus, are challenged to come up with creative solutions to tackle emerging problems. Yasmin Ahmed at Marsh said that she was “drawn to work in insurance because of the career mobility and succession planning. Seasoned insurance professionals plan to retire within the next five years, providing more career advancement for young people.”
In fact, according to the Jacobson Group and Ward Group Insurance Labor Outlook Study, the insurance industry has added 100,000 new jobs in the past five years, and 66% of insurers expect to increase staff this year. The number of opportunities and intellectual challenge are perfect for millennials as, according to the My Path survey, new graduates are more interested in career advancement possibilities (25%) and learning opportunities (20%) when considering a job than older generations. Therefore, young professionals consider development within their careers more important than salary or benefits.
While the industry remained largely stagnant for years, the technological disruption is closing the experience gap and opening important roles for those interested in data science careers combined with creativity. In fact, Accenture’s fintech report found that investments in insurtech more than tripled from $800 million in 2014 to more than $2.6 billion in 2015. In addition to the heavy focus and investments in IT, startups like Lemonade are joining the industry with new technology-based business models. The entrance of startups has already brought recent changes as it motivated insurance giants to expand their focus. Some of the world’s largest insurers, such as Aviva, Axa and XL Catlin, announced their efforts to establish in-house venture capital funds and stated that they will be dedicating more than $1 billion investments in startups to spearhead digital transformation. This focus on new technology also creates more opportunities for the younger generation, as they can make contributions to their team regardless of the job titles.
Most say that millennials are known for job-hopping. However, according to a recent Census study, once they’re satisfied, most will stay at the place of employment for three to six years. The bottom line is that carriers must not blame the generation for their lack of interest in insurance and instead work on raising awareness about the value the industry offers. Right now, a lack of talent is one of the biggest challenges for innovation growth. Insurers will have to make concerted efforts to follow through the recruitment process and provide robust training program to attract and retain young professionals. Through recognizing the underlying cause of the crisis and making an industry-wide endeavor, the insurance industry will be able to grow as a whole and successfully combat the talent shortage.
A lot of ink has been devoted to the looming talent crisis in insurance, bemoaning the difficulty of attracting qualified young people to careers in an industry that is a cornerstone of commerce and one that helps countless people and businesses around the globe recover when the worst occurs. And one need not look far to see the cause of the problem. More often than not, we –insurance professionals — are the cause.
How many of us have felt a twinge of embarrassment when strangers at cocktail parties ask what we do? How many of us have worried about being perceived as leading boring, little lives?
Yet, we in insurance get to spend our days thinking about hurricanes, tornadoes, wildfires, earthquakes, car crashes, cyber crime, fraud, pandemics, terrorism and a host of other equally exciting risks affecting people in all walks of life and businesses in every field of endeavor. And we are increasingly using cutting-edge technology, big data and predictive analytics to enhance risk assessment, pricing, loss adjudication and every other aspect of insurance operations. Moreover, insurers are intimately involved in capital markets, managing billions upon billions in investments, not to mention that insurers’ very reason for being is to provide vital help when people and businesses need it the most.
Bottom line, if you’re concerned about the amount of grey hair you see in the insurance business and the difficulty of enticing budding data scientists, technologists, entrepreneurial spirits and the best and brightest of tomorrow’s leaders to consider careers in insurance, please allow me to suggest that you become an ambassador in service to the cause.
All it takes is talking with pride about the problems we solve, the good that we do and the fun that we have along the way.