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Insurance Industry Outlook

Posted on July 2022

Insurance Industry Outlook

Insurance hiring trends shaping 2022

The insurance industry, like many other financial services verticals, has been gripped by change. The global climate crisis, new entrants, flexible working structures, and candidate expectations, to name a few, are facets that have been a disruptive force for the insurance sector. Today, opportunity could be a turning point for the industry, and Selby Jennings expects to see insurance teams adapt to the everchanging market, yet again this year, to remain at the cutting edge.

Our specialist insurance and actuarial consultants have identified key market factors that impacted hiring and what this means for the insurance industry in 2022. Through the lens of talent, let’s first glance back and examine the state of the insurance market in 2021 to determine if these trends will be set in motion this year.

Property & Casualty

Managing talent was undoubtedly a complex task, especially in the context of natural disasters across the US, environmental, social, and governance (ESG) concerns, and the lingering global pandemic. For the property & casualty sector, the unfortunate hurricanes and tropical storms impacted the market, with an abundance of individuals buying homeowners and flood insurance, particularly across the Southeast.

With the roads quieter due to a drop in commuting, auto insurance fell short in 2021, thus many candidates tried to make a switch into other P&C products, such as commercial property, professional liability, general liability, among others. Lauren Hankins, Vice President – Property & Casualty at Selby Jennings, comments, “with the advancement in telematics however, this can get a more accurate algorithm. For example, onstar systems in vehicles can evaluate driver safety, which will ultimately adjust the cost of insurance rates based on the individual.”

Insurtech took center stage last year, with new firms popping up across the US and driving hiring activity. These insurtech products allowed teams to leverage advanced technologies to streamline operations, cut costs, and provide an agile service. Digitally enabled technologies made it possible for consumers to access insurance at the click of the finger, which in a nutshell, dramatically changed the face of the industry and the need for business-critical talent to meet this demand.

For the P&C market, hiring across Arizona and Florida picked up, but it was the tristate area (New York, New Jersey, and Connecticut) and Midwest that topped the charts, since both regions are traditionally the major hubs for property & casualty insurance.

Health

With many moving parts heavily impacting property & casualty in the past year, what can be said for health insurance? Surprisingly, the global health crisis didn’t mitigate the hiring plans in the health sector, it actually opened up new doors to non-traditional side of health insurance. Medicare advantage talent acquisition remained buoyant, and the team on ground observed a huge uplift in headcount across key players. Under new administration, Medicaid programs exploded across many states, and on the back of these market changes, consulting actuaries were widely sought after – the backbone to help keep health insurance organizations on the right footing.

In similarity to property & casualty, forward-thinking insurtech companies dominated the health field in 2021. Start-ups pushed the boundaries on automation and touchless processes, and through this innovation and significant injection of funding which reached an estimated high of $8.7bn in 2021, headcount needs simultaneously accelerated. Consulting firms were noisy and due to the nature of their work, many looked to up the ante on their talent acquisition efforts.

Normally businesses require a combination of designations and experience. However, this flipped on its head last year – designations had as much onus as experience and firms were willing to pay upfront for it.

The Northeast bucked the biggest hiring trend, mainly in New York and other surrounding states including, Connecticut, Mass, and Pennsylvania, which are typically home to the top consulting firms.

Life & Annuity

From the onset of the global pandemic, most individuals quickly experienced how life could turn upside down overnight – thus, financial protection in the form of life insurance supercharged in importance. This, along with a notable uptick in M&A and Reinsurance transactions across the life and annuity industry, meant that businesses capitalized on the evolving market and hired aggressively, another result of the spike in talent demand.

As we activate more passive talent, remote work remains at the top of every candidate list. The convenience of work-life balance paired with upward flexibility from home attracts the most passive of talent. When candidates need to relocate for the job, consulting firms, direct insurers, as well as reinsurers, have been increasing compensation even more to remain competitive with the remote shift in the market.

With the life and annuity industry being the most active we’ve seen in years; our team anticipates this only being the beginning.

Looking forward: hiring in a new playing field

It’s no doubt that insurance firms enjoyed healthy hiring activity in 2021, but what’s to be said for this year? While the immediate focus might center on the proliferation of digitized insurance tools, such as telematics and automation, we expect flexible working, compensation inflation, and ESG to pose a challenge, or opportunity, for employers.

Compensation trends

Last year, property & casualty talent activity could be described as unpredictable, with this being most prevalent in acquisition. In the candidate-driven market, some firms practically threw out the rule book and overlooked specific exams that would have previously been an industry requirement. This year, it’s likely that organizations will continue to pay a premium to win over top talent from their competitors.

In the life & annuity industry, there is a discrepancy between the supply and demand of actuarial professionals. As more jobs are available than talent, we are often seeing candidates have 3-4 offers on the table. It’s no surprise that compensation has significantly inflated across most insurance verticals.

Historically, for life & annuity as well as health insurance, professionals at all levels of seniority would be awarded, on average, a 5-7% increase on their base salary. This figure has gone through the roof, with many receiving 7-15% increases on the base salary. With such a competitive market, we anticipate continuous increases to secure and retain top talent.

In-demand skillsets

In health insurance, with the continual spike in Medicare, we forecast a huge shift towards this area and Medicaid in 2022, and beyond. With the way that the market has evolved, it’s possible that actuaries with experience in Medicare will be in-demand, especially as bid season is fast approaching. Alongside proficiency in risk adjustment, the Society of Actuaries (SOA) recently added a new exam for predictive analytics.

As always, for the property & casualty sector, the key modelling skillsets going into 2022 is R and Python. With the rise in cyber and ransomware attacks, this might result in a boom in cyber insurance and simultaneously the specialists, minimum of 2-3 years in underwriting, to better service this demand. In addition to fluency in modelling, designations from Associates of the Casualty Actuary Society (ACAS) and Fellowship of the Casualty Actuary Society (FCAS), has importance to employers and therefore significant currency in the market.

Workplace flexibility

As the world of work continues to evolve, how can insurance firms remain ahead of the curve? The future is truly flexible – we are constantly advising our clients to integrate flexible ways of working into their business models. With nearly 80% of all placements at Selby Jennings being fully remote last year, it’s clear that the flexible working paradigm is king on today’s career decision ladder and for employers, this should certainly be considered as a strategy to attract and reduce high employee turnover.

Hiring processes

A speedy interview process is critical to secure market-leading professionals. Chase Rose, Associate Vice President – Health Insurance at Selby Jennings, advises to move quickly because, “some candidates have a first interview on Monday and usually have an offer by Friday.” It’s imperative to hire quick and hire smart. Not only is a speedy interview process more cost-effective, but in today’s market that is deeply driven by candidates, they have all the bargaining chips with competing offers on the table, and laggard processes simply won’t cut it.

The most profound example of fast-tracked hiring in action is in life & annuity. Consulting firms streamlined their interview processes and condensed them into 2-3 stages in contrast to the traditional 3-5 rounds.

ED&I

The insurance sector will continue to play a vital role to push the needle forward, both internally and externally for improving equality, diversity, and inclusion. Society of Actuaries (SOA) have made great strides to promote diversity, beginning at education through to career level, working with networking groups to attract diverse/female candidates to the profession. From sharing insights into the life of an actuary, to all the opportunities available, SOA aims to drive awareness and help build the future pipeline of women into the industry.

From a talent perspective, on the ground, we witnessed many of our clients using redacted resumes and eliminating unconscious bias in the interview process by switching pronouns in communication.

Working with a specialist talent partner like Selby Jennings can help kickstart your next career journey or unlock your organization's full potential. Whether that’s helping to connect to industry-leading opportunities or aligning your talent needs to operational strategies, we have a bespoke talent offering available to both candidates and clients alike. ​

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