There seem to be three “common truths” amongst those of us in the insurance industry:
- Everyone gets into the insurance business “by accident”
- For a huge industry, it’s an amazingly small world
- Insurance is the best-kept secret in Financial Services: nice salaries, relatively sane work/life balance, but without the curb appeal of some of those banking gigs
With regards to this last point – given the alarming talent shortage that is growing across the P&C industry, I wonder if this has been a best-kept secret perhaps kept a little too well. Securing talent with the insurance expertise needed to “run the shop” is becoming an increasingly challenging proposition for today’s Carriers, MGAs and Program Administrators.
Some eye-opening data:
- The average age of an insurance industry professional is 54
- 60% of insurance industry professionals are older than 45
- 70% of claims adjusters are older than 40
Source: Deloitte Research
This problem is growing worse on account of two trends: the retirement of Baby Boomers, and a growing skills gap. Over time, hopefully we’re able to transform a common perception of the insurance industry as outdated and stodgy amongst young job seekers. But in the meantime, insurance companies must think about the problem differently.
The global insurance BPO market has grown to US $2 billion, and continues to expand at 17% year-over-year growth (Source: Everett Research). However, BPO models are transforming from pure cost-saving “lift & shift” maneuvers to more strategic in nature – for both full enterprise operations and more surgical, function-specific approaches. Quality control and communication concerns with off-shore outsourcing are consequently driving demand for on-shore BPO partners. Those U.S. based BPO organizations that are able to package meaningful value-add services alongside traditional business processing will continue to differentiate across insurance companies as the talent gap widens.