Smashing down barriers to entry in the insurance industry

Smashing down barriers to entry in the insurance industry | Insurance Business New Zealand

Smashing down barriers to entry in the insurance industry

In the Great Resignation, the War for Talent, the Great Reshuffle – or any other buzz term for the trend of workers quitting their jobs and/or changing employers and career paths in search of greener pastures – the insurance industry simply cannot afford to maintain any barriers to entry.

Almost every sector is feeling the talent crunch as they try to navigate their post-pandemic recoveries against a backdrop of stagflation (stagnant economies hampered by slow growth and high inflation) and rumours of recession in some parts of the world.

While this may come as a shock to some sectors, the insurance industry is no stranger to talent acquisition and retention challenges. Insurance is an industry that people fall into or inherit rather than one that people choose. That’s because it’s up against other (seemingly) more exciting or lucrative careers in financial services, professional services, and technology.

So, one barrier to entry is the insurance industry’s (seemingly) stale, slow, risk averse nature, as opposed to the gold-tinted careers promised in wealth management or the innovative stimulation offered by technology companies. 

I once again use (seemingly) in brackets because I believe that once you gain some exposure to the insurance industry - either directly as an employee, or indirectly as someone connected to the industry (like me) – you quickly realise that insurance is often anything but boring. 

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So, the first barrier of entry that insurers must break down is related to the industry’s exterior appearance – and I think they’re doing a good job at this. Just look at all the amazing diversity, equity, and inclusion (DE&I) initiatives that are underway in the industry worldwide.

As the insurance workforce grows more diverse, this is opening the doors to more talented individuals, who will (hopefully) trigger a chain reaction simply by changing the narrative around the industry. Someone told me recently that “talent attracts talent” – and while I couldn’t agree more with that statement, perhaps it should be “diverse talent attracts diverse talent”.

Another barrier to entry that is halting young talent in their tracks is the “need for experience”. It is very rare these days to see an insurance job advert that is suitable for someone coming straight out of high school. In fact, entry to the industry is tricky even for those with college degrees because employers want experience.

But in a talent crunch, and with a disproportionate percentage of the workforce approaching retirement, insurers have roles to fill. So, why not invest in young talent? Train them. Mentor them. Build career paths suitable for high school graduates. And don’t make higher education (and the debt that comes with it) a pre-requisite to a career in insurance because the cost of education is a barrier that a huge proportion of young and talented individuals will never be able to overcome.

The cost barrier also relates to things like obtaining licensing and industry designations. If insurance organisations can help their employees through those processes, they’re more likely to retain the young talent that is sorely needed for the longevity of the workforce.

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Finally, there’s this general need to embrace the “new normal”. The COVID-19 pandemic has triggered such a major shift in people’s priorities. Many people lost loved ones or know families who were touched by the virus, and it’s caused people to drop the “work is everything” routine and put family (and self) first.

In terms of family, employees want flexible and hybrid work arrangements, where they don’t have to commute to an office five days a week, giving them potentially more time to spend with family and friends. And as for putting ourselves first, the pandemic has definitely made people think differently about their mental and physical wellbeing. Insurance organisations who want to attract and retain the best talent must consider this in their benefits and employee services. 

That’s just a few of the big barriers to entry in the insurance industry, and there are others that have and will continue to turn talent away. In this great post-pandemic paradigm shift, insurers must focus on breaking down those barriers if they want to set the industry up well for the future.