With over twenty year’s Insurance recruitment experience, I have witnessed first-hand several significant changes that have impacted the industry’s ability to hire and retain good talent. I’ve seen an industry with a relatively low barrier to entry become more professional and modern in its approach to talent acquisition. Several of the large insurance companies now have their own in-house Talent Acquisition/Recruitment teams, but for the vast majority there is still a heavy reliance on external advertising and external recruitment agencies in their quest to identify and attract the best talent available in the market.

However a recent survey by Accenture in the US found that nearly 60 percent of insurers ranked hiring or training as a top priority with “the number of employees age 55 and over being 30 percent higher in the P&C sector than in any other industry” with an expectation that “Insurers will need to fill as many as 400,000 positions in the US by 2020” (this was clearly pre-Covid 19) and Insurers “competing for data management and analytics talent at a time when demand for these skills is soaring”. 

So what does this tell us? That the age profile of the average insurance employee is getting older and without sufficient replacements, eventually the supply line will run out. This is a major concern on this side of the Atlantic too as many companies here in Ireland recognised this shortfall some time ago and have attempted to address this. One demographic that has been actively harvested for talent has been the millennial generation. Where once it was generally acceptable to be “grandfathered” via years of experience and expertise built up in broking, claims or underwriting, the vast majority of Insurance sector employees now have academic credentials to support their “on the job expertise” with many millennials joining post university.

As more school leavers actively sought to pursue third level education, one of the biggest advances within the Insurance sector has been the modernisation and upgrading of the industry’s academic qualifications. With many new entrants to the market now being third level graduates, a particularly noteworthy change has been the introduction of the Insurance Apprenticeship programme via IT Sligo which has seen many small to medium sized firms hire apprentices for a three year period during which they are paid employees whilst they study. This “suck it and see” approach has generally worked well from both perspectives in that it gives the apprentice a chance to try out the insurance sector before fully committing and gives the employer an opportunity to test out a previously untapped market for talent and the chance to compete with others for talent in an ever diminishing pool and address in many cases a critical talent shortage.

A constant challenge for all Insurance firms irrespective of their size or reputation has been how they attract, hire, onboard and most importantly retain the best talent available in the market. I’ve written previously about this topic in The Talent Trap but there are nuances specific to the Insurance sector that I want to explore further with this article. In recent years this has become even more pronounced as the millennial generation began to enter the workforce and many firms I’ve worked with have invested heavily in attracting and retaining this key demographic. A 2018 Deloitte report found that only 4% of millennials expressed a desire to work in the insurance sector. Unlike previous generations who may have joined the industry straight from school, whose interview may have consisted of nothing more than a chat over a cup of coffee (or in some cases a pint), this generation expects a more modern and tailored approach to hiring and recruitment. Given that they are the future of this sector, I feel it important to highlight some of the key differences.

Firstly the millennial candidate now expects Insurance companies to court them in a manner befitting a Big Four Accounting firm. For a number of years now, several of the large (and SME) Insurance firms attend university milk rounds, setting out their stalls in the same way a PWC or KPMG might. This ensures that they have the opportunity to meet the cream of the crop talent before it hits the open market and many of Ireland’s brightest and best Insurance graduates are already snapped up long before they get to wear their cap and gowns.

Secondly the millennial candidate expects a fast tracked approach to progression and unlike previous generations will not simply settle for the “serve your time” approach that the sector was historically noted for. This urgency for affirmation and recognition are significant departures for many employers in the sector who still cherish the value of “serving your time” but have come to accept is the only real way of harnessing this key talent. One benefit in this desire for accelerated progression is that companies can identify pretty early on those for whom this is a career choice as opposed to just a job and the days of the staid, steady, reliable, pen

The modern candidate expects a customized induction and onboarding programme to be in place from day one on the job. Gone are the days when you could bring your new employees into the office, introduce them to their colleagues, show them to their desk and “leave them to figure it out”. Hiring and onboarding your future talent is far too valuable to risk taking such an approach. Engaging them from the start is never to be underestimated and the hearts and minds of your new talent must be won within their first six weeks as your employee. Have you got exact, specific and precise expectations for their performance once they join the business? What milestones have you put in place for them to benchmark against?

Of course this onboarding process has been complicated in recent times owing to the social distancing measures in place due to Covid 19. One of the most interesting features of hiring insurance talent in 2020 has been the advent of virtual onboarding with many firms interviewing, hiring and onboarding their new hires via Zoom, Webex and other virtual platforms. An insurers ability to adopt new technologies and new virtual methods of communication quickly has become an imperative for any firm hoping to compete for talent in the current climate.

The most important factor in retaining the best talent in the market is hiring the right people in the first instance. Poorly executed, recruitment can be a minefield for any employer who makes a mishire and can ultimately be more costly in the long term. I’ve seen countless examples over the years of insurance firms rushing an appointment and hiring in “panic mode” because the fear of not hiring anyone was greater than hiring the wrong person. Result – many have hired the wrong people based on limited choices available from the active talent pool they’ve identified through direct advertising or their internal recruitment process. Unfortunately what many firms in these situations fail to realise is that they’ve chosen from the best available active talent, not necessarily from the best available talent in the market with the true cost of a mishire only becoming apparent sometime later. In work done by Dr. Bradford Smart, author of Topgrading, the estimated cost of a bad hire ranges from 5 to 27 times the amount of the person’s actual salary, so best case scenario your mishire might only cost you five times the salary you’ve offered them. That’s a massive waste of your time, energy and most importantly your resources.

Another emerging factor in retaining the best talent is a company’s ability to offer a more flexible approach to work/life balance. Most Insurance firms found their hands forced into adopting a Work from Home policy as many were simply ill equipped to ensure that social distancing and sanitation measures could be implemented. Many firms now have a staggered presence in their offices, meaning that at any one time, there may be only a maximum of 50% of their entire headcount physically present. This change in approach has led to an expectation amongst many within the market of a more favourable work/life balance going forward and will see a monumental shift towards remote working. Despite some fears amongst the insurance community that this may lead to several jobs becoming automated and effectively redundant over time, this does not appear to be a viable option in the short term and any insurance company hoping to retain their best staff will simply have to offer them the option of working from home on either a whole or part time basis going forward.

In summary the key strategies for any insurance firm to attract, hire and retain the best talent going forward should be:

1.       Conduct a comprehensive search of the entire candidate market. This should include both the active and passive talent pools.

2.       Implement a structured, job specific interviewing, hiring and onboarding mechanism, setting specific intentions and expectations of the chosen candidates from the outset with success milestones built in.

3.       Conduct regular review meetings with your team, ensure that your A players are continually engaged and challenged and that in identifying your B & C players, you have effective strategies in place to address any gaps.

4.       Be prepared to hire some highly ambitious aspiring candidates whose expectations of fast tracked progression will need to be dealt with professionally, yet sympathetically, ensuring that you don’t lose valuable employees that could be considered “high potentials”. It’s easier to retain good talent than it is to hire better talent in the current market.

5.       Offer a flexible approach to remote working accessibility. Within five years, it will be the norm that most Insurance staff will work for some portion of the week from home and when 5G connectivity is introduced, that may no longer necessarily be in the same city or even the same country.

 

Finally, it’s an old cliche but people don’t leave companies, they leave people, sadly the very people charged with managing, leading, mentoring and inspiring them in the trenches. Frankly in twenty years of recruiting for the Insurance sector, I’ve lost count of the number of times I’ve heard candidates say that the reason they want to leave their job is simply the person they report into. If they don’t feel supported and can see a better alternative elsewhere, all the tea in China won’t keep them in that job. It goes without saying that one of the best retention tools any Insurance firm has in its arsenal is the leadership team it puts in place. Do they inspire your staff to grow and develop or do they make them shrink and withdraw? Any leader who empowers their staff and who takes a personal interest in their career development, aligning their goals with the goals of the company is far more likely to have a higher retention rate and to attract the best people in the industry.

If attracting and retaining the best talent in the market is a challenge for your firm, why not speak with Campbell Rochford confidentially and let us help you to address this on a no obligations basis?

Call Gerard on 01-9065116 or email: [email protected]

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