- The insurance industry is facing significant staffing challenges from 2023 and beyond.
- Hiring a young workforce can easily solve most of the challenges though many are not eager to join the insurance and risk management industry.
- It is now upon various stakeholders through initiatives like InsurTech Conference and the National Insurance Careers Month to create awareness and motivate younger people to join the industry.
The insurance industry is set to lose up to 50% of its workforce by 2028 due to retirement. And while logically, this would not be a crisis as the younger generation would fill up the slots, it is not so clear-cut for the insurance industry. One Hartford study found that only 4% of millennials are interested in working in the industry. Also, HR managers in the industry find it hard to retain those who join it.
Another significant challenge insurance is facing is a lack of diversity. A 2023 outlook report by Deloitte points out that large diversity gaps remain in the industry, showing that current strategies are either insufficient or ineffective. The report calls for more diversity, equity, and inclusion in the workforce and customer base and a wider range of voices at the leadership level.
Finally, another significant challenge is that of upskilling and retraining. The insurance industry has had to embrace technology in all aspects, including big data, automation, and predictive analytics. There is concern that the industry is still lagging in integrating all possible applications of technology and digitalization. As the InsurTech Conference 2023 aims to exhibit, there is more room for internet applications in the industry. The challenge is the lack of a tech-savvy labor force; presently, companies are spending a lot on retraining and upskilling staff affected by the new tech changes.
Why should young people join the insurance industry?
Having young people join the insurance and risk management sector can help resolve these three challenges. First, if the industry attracts more young people, then the concern of falling short of replacing a retiring workforce is not there.
As for diversity, young people place diversity as one of their top considerations in joining a workplace, and they are a diverse group across demographics like gender and race. They are also a natural solution to the need for a tech-savvy workforce. They have grown up with tech revolutionizing every aspect of their lives and will easily adapt to its applications at the workplace.
The attractions for youth to join the industry are there. They just need better marketing and awareness. Some of the main ones include:
Stability and opportunities
The insurance sector offers more stability and employment opportunities than most other sectors. David Gritz, Managing Director of InsurTech NY, agrees and notes that “The insurance industry is not a common career aspiration for teenagers, but it represents one of the most stable and entrepreneurial industries.” As the big tech companies lay off workers in their tens of thousands, insurance is looking to employ more. It also has multiple career paths, so instead of switching to different industries, you can easily move across functions even in the same company.
There is room for changemakers
Young people want to work in areas they can make a change and feel valued. Insurance is a service industry, and there are opportunities to impact the industry itself as well as the lives of the customers. The industry needs new ways of doing things, and the market wants new products.
What can stakeholders do to attract young talent?
All the benefits of working in insurance and risk management will only count if there is awareness among the youth. InsurTech events like the InsurTech conferences are a good start and should be more inclusive of young people, from graduates to students. Other efforts, like Spencer Educational Foundation’s mission, offer students opportunities for mentorship and exposure while supporting learning and training in the field.
The industry should adopt attributes valued by a young workforce, including digitalization, more flexible and open-minded hiring practices, and a clearer career advancement path. There is also a need to step up the industry’s environmental, social, and governance initiatives in line with the goals of society at large and specifically those of a younger, idealistic workforce.
The insurance industry and the young people could find in each other surprising solutions to their needs, and it’s all on the industry to do the courting.
