The insurance industry must find ways to attract better talent
The insurance industry needs “less asinine adverts on TV showing insurance people playing with animals, and more of that marketing budget being spent on educating people about insurance, and encouraging a new generation of people into this industry,” according to Zachary Finn, professor and director at Butler University.
According to the College Board database, there are 1935 accountancy programmes for students looking for a career in accountancy, and a slightly more modest 799 finance programs for those interested in a career in that area. But for those interested in getting into a career in risk management or insurance there are a mere 82 programmes.
Speaking at the VCIA conference taking place in Vermont this week, Finn said: “Every baby boomer is having to be replaced by half a gen x’er.” People don’t notice the lack of talent in the insurance industry unless they are unlucky enough to have to make a claim, he said.
Finn said events in recent decades like 9/11, Fukushima and mass shootings in the US meant there had never been such an acute need for people with risk management expertise. Yet somehow this need is not being met.
Part of the problem may be about demand. Troy LePage, senior audit manager at HAI Group, cited statistics showing that only 4 percent of college students indicate an interest in a career in insurance. A show of hands in the audience - or, rather, a lack of a show of hands - indicated few attendees had grown up planning a career in insurance, let alone captives.
Finn called for a dramatic increase in the number of insurance and risk management programmes, which would give more people the skills needed to allow small and medium sized companies to create captives. Even if company managers are convinced of the financial advantages available by creating a captive, they do not have the skills within their workforce to do it, he said.
This problem even affects companies that presented themselves as having some expertise in the insurance business, Finn said. “Many insurtechs are heavy on the tech but light on the insure.”
Panelists proposed a number of initiatives that could make risk management and insurance more appealing to young people, including giving them opportunities to help local communities, more flexible benefits and mentorship programs.
Susan Molineux, associate director at AM Best, said: “Young people want to make a positive change. They are not a generation of complainers, they are a generation that wants to find solutions to problems.”
They are also a generation that is deeply attracted by innovation, said LePage. Promoting the innovative aspects of the industry, and giving them a platform to share their own innovative ideas with their employers, will help keep them engaged with the industry, he said.
But panelists also stressed that education is not only for the young, insisting that people who had been in the industry for years also have a lot to gain from educational refresher courses.
Finn said: “Risk is so contextual, it is always changing, so we need to keep learning.”