Insurance Industry Talent Trends

The insurance sector is grappling with notable talent shortages stemming from various internal and external market challenges. The talent/skills gaps are worsening despite efforts from influential organisations such as Lloyds of London, and leading insurance firms, to communicate the vision of the insurance industry and generate interest from potential talent.

Futureboard Consulting has served as a recruitment partner in insurance for two decades, witnessing these shortages first-hand and observing how different companies have tried to tackle the issue. This article outlines the evolving talent trends and presents innovative and practical strategies to address these shortages.

Background

Two decades ago, Futureboard Consulting partnered with leading global insurance firms that were confronting the industry's reputational challenges. At that time, the perception of insurance was somewhat negative, often described as ‘male, pale, and stale.’ Few companies at that point had reviewed their employer brand or approach to talent management but recognised that they needed to reconsider how they portrayed themselves and look at how they could better attract women and ethnic minorities at all levels. At that time, it was a hurdle to attract bright, talented individuals to the sector, quite often people interested in insurance had a familial connection to the industry

By the early 2010s, reports highlighted the aging workforce (as noted by the Chartered Institute of Insurance) and by mid-2010 there was a gradual shift towards attracting individuals with skills such as data science and technology. Over time, the emphasis on attracting diverse candidates expanded to include factors such as social mobility and sexual orientation.

While the industry has made consistent efforts to bridge the reputational issue and skills gaps, it is clear that more needs to be done. From our perspective, while it has become somewhat easier to attract early careers talent to insurance than 20 years ago, some of the same negative perceptions still exist and certain disciplines are much harder than others to hire into (claims, technology, operations, underwriting roles outside of the London Market, for example.

While it is true the talent gaps exist due to an aging workforce, skill deficiencies, ongoing image issues, and heightened competition from Insurtech and other firms seeking similar skills, the sector has not been proactive in embracing innovative talent management solutions.

Here’s a closer look at some of these trends:

• Aging Workforce: Many professionals in the insurance industry are nearing retirement, creating a pending talent gap as experienced workers leave. Research from the Chartered Institute of Insurance (UK) estimates that 25% of the sector is due to retire in the next 10 years and 50% of the London Market is aged over 50. This demographic shift is happening at the same time as other market forces, creating a greater challenge for the industry. The problem is not unique to the UK, The US Bureau of Labor Statistics has predicted that the aging workforce will leave more than 400,000 positions unfilled.
• Perception Issues: The industry still struggles with a perception problem, despite marketing efforts and internal initiatives, it is frequently viewed as outdated, less dynamic, less creative, and less technologically advanced than other industries. This can deter younger talent who might prefer more cutting-edge or tech-forward industries and discourage experienced candidates in areas such as marketing, human resources, operations, and finance who can find roles in different sectors.
• Tech, Data, and AI Skills: The insurance ecosystem has changed over the last 10-15 years with advances in technology, data, and most recently AI. Every aspect of risk has become more dependent on technology, whether it’s assessing risk, underwriting, selling, or handling claims, there has been some level of digital disruption, automation, and process change in the last decade. These advancements create a need for new skills. Every organisation now requires expertise in areas such as process improvement, automation, data analytics, software for predictive modelling, and cyber risk. The challenge lies in upskilling the current workforce, including those nearing retirement, while also ensuring that new talent is well-prepared for the evolving demands of the industry.
• Slow Adaptation to Change: The insurance industry has historically been slow to embrace change, including modernizing its work environments and adopting new technologies. This lag can make it less attractive to younger, tech-oriented workers who are looking for more progressive and flexible work environments.
• Competitive Job Market: With high demand for skilled professionals in areas like data science, AI, and cybersecurity, insurance companies often struggle to compete with tech firms and other industries that offer higher salaries and the opportunity to work alongside leading experts in their respective technical fields.
• Internal Skills Challenges: Some parts of the insurance industry have recently embraced ‘skills thinking’ instead of looking at talent as siloed into underwriting, claims, customer service, sales, marketing etc. This is an approach to effectively move individuals across disciplines, but again, there seems to be slow adoption of such thinking.

What can the insurance sector do?

Addressing these issues involves modernizing industry practices, improving the industry's image, investing in strategic talent acquisition, training and development to better align with the evolving job market and technological landscape.

Shift in Mindset

It is critical that organisations adopt a specific and holistic mindset to talent management. Specific in the sense that they need to analyse which specifics jobs will exist in the future and holistically looking at the system as a whole, understanding that each job interconnects with another. Talent management strategies should be carefully crafted to best prepare for upcoming talent attraction, all while considering which roles will be automated or augmented in the future by technology. At Futureboard we believe a programmatic approach to talent management can help companies effectively attract, embed, and grow future talent.

Here are some talent programmes that we see working well in insurance:

Integrated Early Careers Strategy

Apprenticeships, Interns, Placement Students, Grad Programmes & Learning Academies

Investing in early career programmes is a strategic move offering substantial advantages. By fostering a steady pipeline of motivated, trainable talent, companies can address both immediate and future skill needs. These programmes enable organizations to adapt flexibly to market changes and drive innovation from the ground up. Early career talent programmes should be seen as strategic investments in building a sustainable, competitive workforce.

Organisations like AON, Marsh McLennan and WTW benefit significantly from structured early career programmes. If delivered and managed well, these programmes can foster employee loyalty, reduce turnover, enhance job satisfaction, improve diversity, and encourage long-term retention. A programme should include rotational assignments, skills development, broad business exposure, and training sessions to foster deep organisational commitment.

Sadly, we witnessed companies in the sector making cutbacks during the pandemic to aspects of their early careers programmes, that were never reinstated. It’s understandable that a company makes cost savings during a global crisis like the pandemic, but it’s important to evaluate what long-term impact reducing graduate numbers will have on future talent pipeline. A point at which it becomes hard to retain talent, is when they are finishing the programme. Companies should be focused on this transition point to retain employee engagement.

The Early Careers market has evolved in recent years. Schools and universities are being more proactive about engaging with employers and there is a plethora of resources to support the attraction of early careers talent. The key to success is developing a cohesive, multi-year strategy.

Second Jobbers

A less commonly adopted solution for attracting early (ish) careers talent, is the second, or third jobber. While at Futureboard we advocate for graduate programmes, there is an often-overlooked pool of talent that have a university degree and work experience. Many students take their first major step on the career ladder onto a Graduate Scheme or ‘just a job’ after a year of travelling or straight out of university. In many cases, for whatever reason, that first step might not be working out the way they had hoped, and as a result are looking for their next important step into a career they are better suited to. Welcome to the “Second Jobber” world.

At Futureboard, we have supported insurance firms with hiring from this diverse, somewhat experienced talent pool. The advantage of this segment of talent is that they come with real-life experience under their belt and a more refined idea of their own strengths and career motivations. As an insurance employer, building a programmatic approach to attracting and retaining this group, is a great way to source new talent. Consider setting up specific career pathways and learning ‘academies’ to engage with ‘2nd jobbers’ looking to move into their 2nd/3rd job/career move.

Returners

Returner programmes represent a valuable initiative for both organizations and individuals. A ‘returner’ is typically someone who has worked in insurance and took a career break for personal/family-related reasons. They not only help bridge the skills gap but also promote a more inclusive and diverse workplace, benefiting everyone involved. These programmes target individuals that have taken a temporary career break, perhaps because of study, parenting, caring for another or some other reason. Convex, Allianz, Markel are three insurance companies embracing this approach.

In the case of Markel, a person has to have taken an 18-month career break before applying for the programme. If successful, Returners enjoy a 6-month paid placement with the support of coaching, a mentor, and a buddy. Individuals can go into audit, claims, underwriting, legal or change delivery are not guaranteed a permanent role at the end but the goal is very much to find a full-time position for talented individuals.

Mid-Career/MBA Hiring

MBA hiring into internships or permanent roles regularly takes place across insurance firms in the US, firms such as AIG, Prudential, State Farm and Allstate are active in this space. The insurance industry values MBA graduates for their diverse skill sets and strategic thinking abilities. As the industry evolves, particularly with advancements in technology and data analytics, the demand for MBA talent is likely to continue growing, making it a promising field for aspiring professionals. With several prestigious business schools in the UK and Europe, tapping into this talent pool could introduce innovative ideas to the industry.

Talent Swaps or Secondments

While specific examples of talent swap programmes in insurance are not widely publicized, they do exist and are known for being a way to facilitate skill sharing and employee development. They can come in the form of employees swapping places with an individual from another department, e.g. underwriting to claims and vice versa, or could be individuals acting as a mentor to people in other departments to aid knowledge sharing. A few examples of companies in the insurance industry that have implemented such initiatives include Allianz, Liberty Mutual, AIG, and Chubb.

In the case of Chubb, they offer cross-training and development opportunities that allow employees to work in various departments, particularly in underwriting and claims. This exposure helps employees understand the interconnectedness of their roles.

Technology instead of People

The final point is that not all people leaving the industry will need to be replaced. As we have seen in recent years, technology is increasingly able to take on more routine tasks. Ever-evolving technology, greater automation of processes, chatbots in customer service, and utilisation of AI and data analytics software means that certain tasks and responsibilities can, and will, be replaced. Darcy Dague, Managing Director – Insurance, for Accenture in North America writes about this in her article: “How to address the urgent insurance workforce gap with technology.” In this article, she advises on a cross-functional approach in insurance looking at ways technology can “augment” the work of people to create operational efficiencies.

Conclusion

The insurance sector faces significant challenges in attracting and retaining talent. With a wave of retirements on the horizon and continued technological disruption, a wealth of experience is set to leave the industry, and younger individuals are not eagerly pursuing careers within this sector. To bridge this gap and foster future growth, companies must adopt innovative strategies that blend technology with a re-skilled workforce. The urgency for this transformation is critical; without it, there’s a risk of insurance companies falling behind and failing their customers.

If you would like to discuss any of the topics in this article with Futureboard, Please contact Karen Berry +44 (0) 20 3179 4500 kb@futureboardconsulting.com