Now is the Time for CEOs to be Bold on Talent

November 14, 2023 7 mins

Now is the Time for CEOs to be Bold on Talent

Insurance CEOs are well aware of the talent crisis: they’re fully engaged and seeking answers.

Key Takeaways

Insurance leaders understand that without people with the right skillsets they will have to alter the quality of what they do or deliver less - neither strategy is an option.
The need to rethink talent is urgent, and lessons can be learned from other sectors to accelerate progress, including commtech and pharma.
The CEOs we spoke to are ready to face into the complexity, recognise the urgency of the task and want to act.

In the first of a series of articles, Louisa Blain, Talent Solutions partner for Insurance at Aon, looks at the challenges ahead, examining the insurance industry’s perception problem and offering potential solutions to attract and retain the right talent.

We’ve all seen the headlines about how the insurance industry has a hiring crisis; that insurers are losing the war for talent. But most of what we hear is an oversimplification of a highly complex and multi-dimensional problem.

I've been working closely and comparing notes with consultants from Aon's Strategy and Technology Group. And our conversations with 30 specialty and commercial insurer CEOs tell a more nuanced story.

They tell us how they are working hard to understand the fast-evolving business challenges they face – and what kind of skillsets their organizations now need to overcome them.

Insurance industry leaders see that they must adapt their businesses to manage digitalization, and at the same time stay relevant in a shifting risk environment. Meanwhile, game changers like climate risk, socio-economic and geo-political upheaval are heaping uncertainty onto the macro-outlook.

Hobson’s Choice: Get the Right People or Jeopardize your Business

CEOs are keenly aware that they must field the right team to play the tactics required of them to win. They understand that without the people with the right skills in place they will have to alter the quality of what they do or deliver less. Neither strategy is going to play well with stakeholders.

It’s why “talent shortage” doesn’t begin to cover the scale of the challenges facing insurance CEOs:

We need to attract people with the right mindset and skills for a fast-changing business environment. While AI is progressing and will contribute efficiency in many areas, including enabling humans to make better choices, we need talented, forward-thinking people in abundance entering the sector.
Insurers want people with transformational skillsets, but they need to improve their ability to identify, recruit and onboard such individuals.
Recruitment in volume terms at the current rate is not sufficient.
Finally, assuming successful talent attraction, insurance leaders must then evolve their company culture to improve development and workforce retention.

Addressing the Insurance Industry Image to Attract More Talent

Compared with other services sectors, insurance has a longstanding attraction problem. The industry struggles to attract people from outside because it is perceived as stuffy, old fashioned and behind on the transformation curve.

Perception is a persistent problem from a recruitment point of view, and recent media coverage of lawsuits around lockdown business interruption hasn’t helped. Even further, there were some cases where the industry’s workplace culture around behavior, diversity and inclusion did need resetting.

But arguably the biggest problem is that insurance is still unjustifiably regarded as boring and irrelevant.

What is the Solution?

Insurance has an incredible story, but it fails to share it beyond the sector. It is often seen through the lens of pet or car insurance, as opposed to the part it plays in facilitating satellite launches, de-risking renewables projects or improving society’s resilience to natural disasters. Our industry’s analytical and financial engineering skills are on a par with those in investment banking and they are applied to seemingly intractable real-world problems.

So, we should stop talking about ‘insurance’ and start talking about our ability to enable businesses and individuals; helping them to make better, braver, bolder decisions.

Our research suggests there are sectors that have a better employee value proposition that insurers can look to for inspiration: commtech and pharma are standout examples. Of course, it isn’t easy for a business with as many moving parts as insurance to translate what successful companies in other fast evolving sectors have done – but learning lessons from those outside of the sector provides us with the opportunity to ‘leapfrog forward’ and accelerate the transition.

Underwriting the Future: Transformed by Automation

Solving the business challenges that face CEOs will require transformation throughout the enterprise. This applies even where machine learning technologies can be leveraged, such as in workflow processes.

But the underwriting role is perhaps the most visible because of the adaptation qualities underwriting teams now need to deal with the insureds’ changing risk profiles.

In the past, experience was an underwriter’s most valuable asset, set against the ready availability of reliable, historical data. It is a strength that works fine when the pace of change is slow. Today, because uncertainty is the only constant, a more multifaceted, systemic approach is required.

Underwriters need a better understanding of the business risks their clients want to transfer: looking ahead is just as important as looking back. Cyber and weather risk are good examples of how quickly our risk models can become outdated. In specific lines, like energy, renewable technology is evolving so fast that the demand for engineering input is urgent.

Grasping the Nettle: CEOs are Rising to the Challenge

Integrating a much broader mix of skillsets, experiences and personalities won’t be easy.

In the near term at least, individuals will have to learn to recognize, respect and value differences in expertise in a way that hasn’t previously been experienced. Achieving cohesion and collaboration between colleagues with different skills and backgrounds is a big cultural challenge that calls for a renewed focus on engagement and belonging.

People who can manage this sort of transformation will also be more in demand. They can help insurers explore new and flexible ways of working to develop more agility and adaptability, for example, they can suggest alternative recruitment approaches, value propositions and accelerated career development paths.

When discussing our feedback from insurance industry leaders, we were struck by just how engaged in the human capital question CEOs actually are. Yes, they understand that any move to transform the talent profile of their company will be challenging. They even know it could be so disruptive that key colleagues could feel threatened.

But the CEOs we spoke to are ready to face the complexity, recognize the urgency of the task and want to act. As risk professionals, they understand that now is not the time to be risk averse.

Discover More: Contact Louisa Blain to learn how you can make better informed decisions to attract and retain talent.

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