It's never been easy for the insurance industry to recruit young talent. Unless one has literally grown up in the business--perhaps as part of a family-owned independent agency--it takes a fairly creative sales job to convince new blood to try their hand as an underwriter, actuary, claims adjuster, CSR, broker or any one of a hundred careers in insurance. That quest will only get more challenging as the Baby Boom begins to go bust, warns CPCU Society President Betsey L. Brewer. Read on for her take, and post some of your ideas on how to draw the best and the brightest.
As Baby Boomers Retire, Who Will Take Their Place At Carriers, Agencies?
BY BETSEY L. BREWER
The insurance industry is going to face a veritable crisis in a few years unless we get more experienced newcomers. Young professionals need to consider getting formal training, a professional designation, or other industry credentials so they can be on par with their predecessors.
The simple fact is that the Baby Boomers are heading out. This is both good and bad.
A view from the most positive perspective would be that we’ll have new people entering our industry, filled with fresh and innovative ideas.
On the negative side, there will be a tremendous loss of experience. In fact, 43 percent of respondents to a recent CPCU Society member poll said they have 30 or more years of experience in the insurance industry. More than 60 percent have had their CPCU designation for more than 10 years.
Employers will surely face difficulties when trying to replace seasoned insurance professionals, such as these poll respondents.
As the retirement of the Boomers looms closer, employers will have no choice but to replace these employees with less qualified or less experienced applicants.
About 75 percent of CPCU Society members polled expect that employers will encounter significant delays in their respective hiring processes, due to time spent either searching for or training these replacements.
The CPCU Society’s members recommend a succession planning process for insurance companies that is reasonable, providing adequate time so the next wave of talent can be developed.
This idea of succession planning is just one part of the process. We need first to attract people to our industry.
If you mention a career in insurance to a young person today, he or she might roll their eyes at you or laugh. But if we tell these same people that our industry helps restore peoples’ lives, that insurance is a huge part of the economic structure of the world, and that it can yield a lucrative career, their gut reactions may change for the better.
Many jobs on both the distribution and underwriting sides, as well as with collateral service providers, have been parsed into smaller, bite-sized chunks.
This may make training and replacing people easy, but it also diminishes opportunities for those capable of seeing the bigger picture and tackling all these jobs.
Some of these potential recruits may already be working in the industry, but just need some more experience and education to make a transition to a position with greater responsibility.
For these folks and industry newcomers alike, the CPCU designation is a great solution. Why? The answer is simple.
The CPCU program is a comprehensive program covering most aspects of the property and casualty industry. It is an education in the p-c business. Many training programs are geared toward specific jobs, but none have the same in-depth all-around curriculum as the CPCU.
On the agency side, customers will appreciate the level of service they receive from someone who has this level of education.
Surveys have shown that consumers are primarily concerned with personalized service. Having a CPCU gives agency pros a jump start because they are simply more knowledgeable about the insurance mechanism and can transfer that knowledge onto their customers.
CPCU is made up of the three “E's”—education, experience and ethics—and today, ethics is of foremost importance. It doesn’t matter what their job description is, CPCUs are held to the highest ethical standards. These are enforceable, and CPCUs agree to abide by them from the start.
The CPCU Society’s members have a network of nearly 28,000 professional associates worldwide. Members can connect with their Society colleagues to help them in their current jobs, thereby passing along that shared knowledge and expertise.
The Society also sponsors, through its local chapters and at semi-annual meetings, a multitude of leadership development courses that bring industry practitioners additional soft skills they can put to work immediately.
The CPCU curriculum is constantly updated to cover current issues and changes within the industry, but it lays the foundation industry practitioners need to achieve.
The CPCU Society is there to demonstrate to all employers, customers and the public that you are a professional, that you adhere to a code of ethics, and that you have resources to call on when you need them.
(Betsey L. Brewer, CPCU, is president of the CPCU Society for 2006-2007, as well as senior vice president and partner with the Rule Company in Pasadena, Calif. She can be reached at bbrewer@ruleco.com.)
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Do you folks have any ideas on how to recruit more talent into this industry?
Comments (6)
The attainment of a designation is a surefire way to advance within the insurance industry. It should also be a nationwide criterion for access to the industry. A formalized educational background should be a requirement by employers. Why not a bachelors of insurance degree? By ensuring a skilled labor force is transacting with the public, would insurers not be going a long way in stifling the public outcry over the lack of service and shoddy claims handling? It also ensures career longevity and a better than average pay rate. By putting professionals on the front line, the image improves and the attractiveness of the job increases.
Posted by Marc Dubois | October 16, 2007 12:29 PM
Posted on October 16, 2007 12:29
I once wrote an article for a professional journal on why the insurance industry was losing the professional safety personnel, replacing them with fee basis consultants and in many cases, with less qualified "inspectors."
Just as Betsey indicates, it's difficult to attract new talent into the industry. But in many ways we're directly to blame, for failing to provide that portal of professionalism--the same one we did many years ago that attracted so many bright minds from top universities into our engineering and safety departments.
Internally, we have failed to train our own to rise to new levels of professionalism and expertise. For example, the IIA once offered the ALCM program that provided a vehicle for Loss Control personnel to achieve the professional Associate in Loss Control Management designation. I personally instructed that program for a number of years. It has now disappeared and nothing has taken its place.
One very important aspect of that program was that attendees were all insurance people. They were attempting to improve their professional knowledge, move up in their jobs and move into new positions within their companies. By removing that rung in the ladder, people simply went elsewhere for the professional certifications and designations they felt they required, and we lost good talent, often to construction and industrial companies rather than insurance companies.
I have found some companies use the "cheaper is better" philosophy when it comes to safety and protection personnel. They prefer to hire the least costly people to oversee the greatest risks the company has--their policyholders! This is especially true in the workers' compensation markets but true in the P&C arena as well.
The cost of a highly trained in-house engineer who knows water supplies, hydraulics, understands the codes intimately and their application on all types of risks, and who can tell you a sprinkler system is deficient is worth his or her weight in gold on the $50 million risk you don't write--or one you can have corrective measures completed upon before writing.
Worth much more than the "inspector" who looks at the system and sees pipes and sprinkler heads and says it's sprinklered, and there's a reading on the gauges so it must be okay... a week or so before the big conglagration!
Posted by BJ | October 16, 2007 1:24 PM
Posted on October 16, 2007 13:24
Better pay, perks and prestige might help catch the attention of the young and upwardly mobile. Otherwise we'lll get the leavings from other industries that have already decided that talent is worth more. And as a side benefit, it might convince a few of us old gray heads that retirement should be put off a few years! Nah, just dreaming.
Posted by William Safreed | October 16, 2007 3:07 PM
Posted on October 16, 2007 15:07
Much information has been written about the boomer retirement issue, sighting all kinds of scarey statistics about its eventual impact on virtually every business in the U.S. Contained within that data are stats that show very large numbers of boomers are financially ill prepared for retirement. Thus many will have to continue working at least part time to augment insufficient financial planning.
Since remote computer access, telecommuting and other marvels of the comuter age are now available to everyone, preserving senior talent and knowledge is easier than ever---if the boomer wants/needs to keep working.
Many neighbors and friends who have already retired have found that within 6-8 months they are bored and in need of stimulation beyond that found on the golf course or in the casino. Now they are looking for part time work--most don't want to be a greeter at Walmart--and virtually all of them regret taking full time retirment. Message here for employers is to offer flex-time, remote access, telecomputing etc., and retain all that knowledge you have already paid for over many years with your boomer employees.
You will be doing them and yourself a huge favor--and our dwindling number of golf courses won't be as crowded either.
Posted by Tom Davis | October 17, 2007 10:36 AM
Posted on October 17, 2007 10:36
There is now a Bachelors degree program in insurance and risk management. It's only being offered at three or four schools around the country, but I feel as it's necessity becomes evident, more schools will offer the program.
Without talking out of school, in my area of the country (the midwest) we are inundated with insurance agents and brokers and I for one am glad to see some of the "baby boomer" generation starting to retire.
Diversity is a good thing, but eventually you can have a few to many mouths at the table. I do, however, agree that the insurance industry is relying way too heavily on "outside consultants" and subcontracted entities to perform risk management we should be doing in house.
Posted by Michael Burnell | October 18, 2007 3:33 PM
Posted on October 18, 2007 15:33
The war for insurance talent IS a perfect storm! We are faced with a maturing population and a declining new workforce.
By 2010 nearly one in three workers will be over the age of 50! By 2012 more than 21 million jobs are expected to be created in the U.S. However, merely 17 million new workers will enter the job market. I could go on and on.. This storm will have huge ramifications on the insurance industry!
If we don't begin to seriously address the lack of focus in recruitment, training and development of the next generation of insurance leaders this problem will cripple the industry.
Posted by Jay D'Aprile | October 24, 2007 10:20 PM
Posted on October 24, 2007 22:20