We’ve heard the ominous music. Felt our hearts beat faster. Wiped the nervous sweat from our brows. We were warned. The insurance industry is in jeopardy. The talent gap is coming. It’s getting closer.
And now, it’s here.
How did we get here? How did the talent gap transform from an ominous threat to a reality? Were we powerless to stop it or could it have been prevented?
Read on to find out if the talent gap in the insurance industry really does exist and how it came to be.
With Age Comes Wisdom
The insurance industry is one that rewards longevity. It’s a lifetime career, and employees tend to see it through until their retirement.
As a result, part of the reason the industry is facing such a remarkable talent gap is that many of those who have stuck with insurance from the very beginning are starting to retire.
The insurance industry is therefore losing a large number of its faithful employees, along with the knowledge and experience they have accumulated along the way.
Normally, retirement would not cause such a problem for an individual industry. However, retirement, combined with low unemployment rates and a significant lack of college graduates going into the insurance industry means the knowledgeable employees that are leaving are not being replaced.
Less than 10% of millennials have any interest in a career in insurance, largely due to the stereotype that insurance is boring and much less attractive than other high-paying fields such as finance or marketing.
In addition to the changing workforce, wages for insurance employees have remained relatively unchanged over a long period of time, which provides even less incentive for young people to consider a career in insurance when compared to other more popular industries.
Robots Are Taking Over
Okay, robots aren’t exactly taking over.
But, technology has become an integral part of the insurance industry and transformed the way employees work.
It has changed what it means to be an employee in insurance, streamlining simpler, more administrative tasks and making way for employees to focus on customer relations.
Employees’ main goals and responsibilities nowadays are managing customer expectations and higher-level claims adjusting.
Technology has also had a profound impact on the insurance adjuster’s relationship with the customer. It has provided an unprecedented level of transparency between the carrier and the customer, creating a customer who is much better-informed and who, as a result, has much higher expectations.
Customers now have a much wider spectrum for comparison when it comes to insurance, which not only forces carriers to be more competitive on price but also on the level of service they provide.
Employees not only need to know their cases inside and out, but they also need to be able to communicate with their knowledgeable customers in an effective and personable way.
Be Realistic When Confronting the Talent Gap
These days, insurance adjusters tend to go into the field specializing in one particular aspect of insurance, such as auto or homeowners’ insurance.
Yet, carriers are still looking for claims managers with 5-10 years’ experience with skills in commercial property, litigation, construction defect, and multi-line insurance. Adjusters with this kind of experience are few and far between because the industry has evolved beyond that.
It’s important to not only have realistic expectations when it comes to hiring but also to make sure that the proper training programs are in place to help employees reach their full potential within the company.
The talent gap is not just the result of long-term employees retiring and millennial’s avoiding what they think will be a mind-numbingly dull career. It’s also the direct result of a lack of sufficient training and forward planning.
Instead of investing in training newcomers, disproving stereotypes, and providing incentives for young people to pursue careers in insurance, we’ve been depending on long-term employees, expecting them to carry on working forever.
Now, we risk losing vital institutional knowledge and long-established relationships because of a simple lack of forethought and desire to invest in new talent.
It’s also essential to be realistic about the cost of using a recruiter to help find qualified candidates. It may seem like a more cost-effective approach to tackle the hiring process alone, but is it really worth the cost of leaving that position unfilled for what could be months?
Recruiters have a vast network of extremely valuable connections and quality candidates to help the business find the perfect fit as fast as possible.
It’s Not All Doom and Gloom
Yes, we may have gotten ourselves into a bit of a talent crisis. Yes, we should have been more prepared. But, is it impossible to improve going forward?
We may be faced with an increasing number of retirements, but we will not fall apart. We may struggle to recruit the young because they are restless, but we will not be discouraged. We may find it difficult to keep up with a market and workforce that are constantly evolving, but we will remain flexible.
The talent gap is here. It’s not a possibility, it’s not about to happen, it’s here. It is our reality.
So, what do we do? How do we revitalize the insurance industry? How do we show the young ones what they’re missing out on? How do we save that vital knowledge our dedicated employees have accumulated?
There was no one cause of this talent crisis, and so there will be no one answer. It will take hard work and dedication, and an overhaul of outdated processes and practices.
But, it can be done. The insurance industry can come back, even stronger than it was before.