The insurance insurance industry is rapidly transforming, driven by technological advancements, regulatory pressures, and evolving consumer expectations. As a result, insurers grapple with a unique set of workforce challenges.
Let’s delve into four critical insurance workforce challenges that impact employee competency and insurer competitiveness: succession planning, remote work, employee upskilling/reskilling, and employee retention.
Succession Planning and Career Pathing
Many insurance employees have neared retirement age. According to data from the US Bureau of Labor Statistics, the median age of the insurance industry workforce is 44 – about six years older than the average age of the American workforce. Plus, there are nearly 700,000 insurance employees older than age 55.
Many insurance companies are unprepared for the retirement of longtime employees. A robust succession plan ensures business continuity and promulgates institutional knowledge.
Insurers often struggle with identifying and developing high-potential talent to fill leadership roles. Some ideas to help address this:
- Consider a talent inventory: Identify important positions and potential successors.
- Implement mentorship programs: Pair experienced employees with high-potential talent.
- Offer leadership development programs: Invest in training and development opportunities for emerging leaders.
- Create clear career paths: Outline potential career progression within the organization to motivate employees.
The Remote Work Revolution
The COVID-19 pandemic accelerated a trend in insurance employment: Remote work. According to AgentSync, 69% of workers in insurance and finance work remotely or are hybrid, compared to just 31% that work in the office. Insurance executive search firm The Jacobson Group found that 45% of insurance employers offer full remote options, while nearly 90% expect to provide a hybrid model.
Remote work has its perks but also presents business challenges, especially around employee engagement. Here are some ways to improve engagement:
- Foster a strong company culture: Implement virtual team-building activities and maintain open communication channels.
- Invest in technology: Provide employees with the tools and infrastructure for remote work.
- Set clear expectations: Define roles, responsibilities, and performance metrics.
- Prioritize employee well-being: Offer resources for mental health support and work-life balance.
- Encourage in-person experiences: Leverage walk-in office hour opportunities, monthly town halls, or onsite celebrations to help team members connect and build personal relationships.
Upskilling and Reskilling for the Future
The constantly evolving insurance industry requires employees to adapt to new technologies and processes. Recent research by Deloitte indicates that health plan finance leaders aim to improve operating margins over the next three years. To do so, half of them seek to modernize core technologies or invest in digital technologies.
Those technologies may require upskilling or reskilling to be most effective. Insurers must prioritize upskilling and reskilling to remain competitive. Here are some ideas:
- Start With a Needs assessment: Identify skill gaps within the organization.
- Tailored training programs: Develop training programs aligned with business objectives.
- Leverage technology: Utilize online learning platforms and e-learning modules.
- Encourage continuous learning: Foster a culture of lifelong learning and professional development.
Enhancing Employee Retention
Reports indicate that in the past ten years, the insurance industry has seen employee turnover rates increase from 8-9% to 12-15%. That includes voluntary and involuntary turnover but still paints a troubling picture for insurers. Employee churn can have negative member impacts.
Retaining top talent is crucial for organizational success. Insurers can improve employee retention by:
- Competitive compensation and benefits: Offer comprehensive benefits packages that meet employee needs.
- Employee recognition programs: Celebrate achievements and contributions.
- Work-life balance initiatives: Promote a healthy work-life balance through flexible work arrangements and wellness programs.
- Career development opportunities: Provide clear career paths and opportunities for advancement.
- Open communication: Foster a culture of open communication and feedback.
By addressing these four insurance workforce challenges, insurers can build resilient, high-performing teams capable of navigating industry challenges and driving organizational success.
Certifi’s insurance premium billing and payment solutions help payers improve member satisfaction while reducing administrative costs.
