Of the 2.5 million people reportedly working in the insurance industry today, it’s expected that about 500,000 of them will retire over the next three years. That’s one out of five individuals who will be leaving the workforce by 2021. This impending shift may result in a massive loss of institutional knowledge, creating one of the biggest challenges facing the industry today.
Millennials seem to be the logical replacement for retirees as these younger professionals comprise more than a quarter of the U.S. workforce. But for many reasons, millennials are drawn to industries other than insurance. They just don’t seem to find insurance compelling or exciting—an impression confirmed in an ISO career survey conducted a few years ago, which found that less than 10 percent of millennials expressed interest in an insurance career.
What can be done to prepare for the recruitment challenge? That’s a question I explored with a panel of insurance executives during Verisk’s 2018 Risk & Analytics Summit last October. Our session, “The Automation Generation: How to Fill the Growing Talent Gap,” looked at creative ways to attract, onboard, and develop people to address the looming talent gap. We also considered how artificial intelligence (AI) and automation will not only help replace some of this lost talent but also improve the customer experience and enhance job satisfaction.
Automation, AI, and InsurTech
How do we address the needs of tomorrow? The strides we’re making with automation and AI hold great promise. In the panel session I explored the Pareto Principle, named for the 20th century economist whose theory is used to explain how 20 percent of input into a process generally creates 80 percent of the results. Applied to insurance, we might look at automating the basics of our processes (80 percent) and focusing human talent (20 percent) where it matters most, such as on the most complex underwriting risks and biggest claims.
InsurTech promises a far-reaching transformation of our industry and has many of us energized in a whole new way, if record-breaking attendance and the buzz at last fall’s InsureTech Connect conference in Las Vegas is any indication. Amid this trend, insurers are engaged in a technical revolution to automate their processes and digitally engage with policyholders more effectively. With its potential to free professionals from rote tasks to focus on higher-level, more intellectually stimulating ones, the advent of InsurTech may represent one of the most powerful recruiting tools available to us. We should capitalize on this opportunity to attract fresh young talent that grew up amid the tech revolution.
What else can we do to draw recruits to our industry? And how do we retain them?
For starters, the panelists agreed, we must tell a more compelling story about what it means to work in the insurance industry. We need to look back on our own early careers and recall the passion we had—what compelled us to pursue careers in the insurance sector in the first place. Sometimes we forget what it was about the industry that we found exciting or intriguing, entering our professions as we did when we were the same age as today’s millennials.
A better story
One session panelist related how his son, a recent college graduate with a finance degree, initially rejected any notion of following in his father’s career footsteps. The wise dad invited his son, along with one of his friends, to dinner with a few top agents and brokers. It wasn’t a job interview so much as it was a storytelling session.
The career veterans regaled the young men with “war stories” from their days in the trenches, bringing to vivid life a profession that might have seemed stodgy and dull to a recent college graduate. By the end of the evening, the young men were fired up and willing to explore an insurance career path. The message they heard was that insurance can be fun, challenging, and exciting. That’s the story we need to get better at telling.
Much has been made of workplace cultures designed to appeal to millennials, such as offices stocked with snacks and foosball tables, and a number of insurance organizations are trying to replicate that model to attract young talent. Yes, Verisk has followed this trend with video games, foosball, shuffleboard, and other games installed in our newly renovated innovation center.
But we know millennials are looking for more than the trappings. By and large, they share altruistic traits. They’re searching for work that’s meaningful and purposeful. They’re looking to discover new opportunities and trying to find the career that ignites the spark within them.
The panelists agreed that this is another area where we can tell a better story. For a young person who wants to make a difference, insurance offers an ideal opportunity. We’re all about assisting people—especially those in need—and helping to solve their problems.
Insurance entities also are rethinking their internship and training programs as another way to attract and retain talent. One panelist brought the perspective of a startup. In that environment, she said, traditional career paths are challenged, ladder trajectories are thrown out, and new recruits are cycled through different areas of the organization and given opportunities to experience multiple roles.
In conjunction with rethinking career paths, we should rethink whom we’re recruiting. Some organizations are looking at candidates outside the insurance industry—prospects with tech experience, for example, who will benefit from insurance training when they’re onboard and who bring a skill set our industry needs.
Finally, the panelists warned against neglecting workers of older generations. In addition to offering a hard-to-replace wealth of industry knowledge, experienced workers often bring more mature people skills and emotional intelligence to the table.
Let’s tell a more compelling story about our industry. Let’s capitalize on the buzz InsurTech is creating. And let’s reimagine what it means to be a professional working in the insurance industry of tomorrow.
This article originally appeared in Rough Notes and is republished with permission.