Are young industry pros being set up to fail?
November 28, 2019 by Adam Malik
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Young insurance professionals are being put in senior positions despite not having enough experience and it risks putting the industry in a perilous position, warns one veteran award-winning broker. Complicating matters further, she says, the industry across the board has to do a better job of offering opportunities for young insurance professionals to educate themselves.
With an aging demographic exiting the business, nothing can replace experience, said Monica Wolding, recent winner of the CIP Society’s National Leadership Award. “The younger generation hasn’t got the experience [yet],” said Woldring, who has been working in insurance for 50 years. “I’m not complaining, but the companies don’t have the wise old white heads [for young people] to go to and say, ‘Hey, I’ve never seen this problem before. How do I fix it?’”
The younger generation isn’t to blame, she emphasized. It’s just a reality of the situation with the old guard retiring. Consider the current hard market, the first to hit the industry since the early 2000s. “How many people have joined our industry since 2001?” she told Canadian Underwriter. “They’ve never seen a hard market before.” Her point being that today’s insurance professionals simply haven’t had a lot of time to amass any sort of institutional knowledge.
As Baby Boomers exit the P&C industry, young people are moving up the ranks faster to fill the void. But Woldring cautioned about doing this too quickly. “The reality is, younger people are cheaper. And there’s nothing wrong with being young. We all were at one point. But I think we need to let people simmer longer,” she said.
The risk is that people are being put in positions for which they’re not ready. “I work with clients every day who bought a cheap policy somewhere. Then they have a claim and discover that it’s not covered because they didn’t understand what they were buying,” said Woldring, who is vice president of commercial insurance for InsureLine Brokers Inc. in Port Coquitlam, B.C. “The person who sold it to them didn’t understand what they were selling, and the underwriter who quoted it didn’t understand the risk either.”
Woldring was speaking personally and not as a representative of her brokerage. Canadian Underwriter reached out to her after she won the award to ask her about the state of the broker business today. A broker by day, she also teaches through the Insurance Institute of Canada. She highlighted education as an essential way to bridge the knowledge gap, but it needs to be taken more seriously by everyone in the industry, she added.
“There are a lot of people doing all their continuing education online, which is all well and good, but are they actually there for the whole time?” she wondered. “Or do they turn it on and then, if there is no interaction, walk away?”
Woldring recalled a recent webinar she hosted with a carrier that had more than 1,000 people in attendance. She invited anyone who needed additional information to get in touch. Only two people did. “Does that mean that the others felt that I didn’t have anything else to give them?” Woldring asked. “That’s fine, but the reality is: How many of those 1,000 people actually heard what was said?”
Engagement is critical to the success of education, as Woldring notes. Are people actually taking an interest to learn during classes, or are they there just to get credits? “Continuing education is a great idea and I love it,” Woldring said, “but we have to make sure it does continue to educate rather than [brokers sitting] through a class because they have to sit through a class.”
When you have an industry with easy entry, especially in the commercial vertical, where the licensing exams are rudimentary at best, then we all suffer. My observation is that the industry spends way too much time on automobile insurance, which is highly regulated, very formulaic, a political football and a price play, when all of the value comes from commercial and high end private client risk (think jobs, competitiveness, wealth preservation, accretion, intellectually stimulating, etc.) where the regulators and industry education resources spend little to no effort understanding nor policing. The reality is the automobile insurance is basically a dead-end pursuit. For those that cannot see the end just mumble words like Google, Amazon and Tesla.
This article has hit the nail on its head. Outside of all this is said, which I have been saying to my President for the longest while, is that the young folks feel that they know everything and has attitude to go with it, perhaps this is the reason they cannot learn. Great talker, by the way.
I know of one of the well respected Insurer, who has embark to letting go of a lot of their experience people and they have the philosophy that talking is the game. It is a scary time in this business. Too much technology is some of the hinderance since they young u/w just fill in info and not having to think too much.
The profit for everyone is the big factor. Anything we have a service or commodity which HAS to be bought there would not be too much to worry. The power to be think it has to be bough. That is the other problem.
Totally agree with Monica’s comments.
From my experience, the majority of younger brokers and underwriters actually do not respect their older peers nor the accumulated knowledge and skill base of these veterans.
More worrying is the apparent attitude of the senior management in both brokerages and insurance companies that equally do not value these veterans and the invaluable knowledge and experience that they can offer the younger brokers and underwriters as mentors.
Once the veterans retire (whether forced or voluntarily) that resource is lost to the industry, never to return.
Simply, we have been watching over the past 15 to 20 years the “dumbing” down of the skill and knowledge base of the insurance community.
The end result is and will continue to be dangerous to the insurance buying public.
Without investment by the insurance community in mentors (both from within their organizations but also from without), the industry can look forward to ever increasing Errors and Omissions claims and legal actions by the insurance consumer for inadequate or failed policy coverage.
Fundamentally this comes down to the transferring of knowledge. This is a tale old as time (did you catch the Disney reference) There will always be a generation before that has more expertise, knowledge and experience, and its their responsibility to transfer that onto the next (younger or less experienced) generation.
I would like the dialog around millennials to shift (there I said it, that scary word that makes baby boomers run for the hills) instead of a wide blanketing miss categorizing of an age group by calling them entitled, disrespectful, and bad learners (here’s looking at you Margaret Chetram), perhaps get to know your fellow teammates, understand their difference, and maybe find a couple similarities. You may learn something you didn’t except. Maybe you’ll learn that the younger generation is excited, open and willing to learn from their veterans (your word for our specialists, not mine).
I think this article sums it up perfectly “Engagement is critical to the success of education” and this simple, yet elegant statement, applies to all learners – old or young. Keep engaged, stop looking to blame, look to lift people up. Next time you see someone needing an education of sorts, give it. Trust me, we will respect you for it, and appreciate it more than you think.
It seems to me that professionals who post comments should read their remarks prior to sending them to a public forum. Poor grammar skills and typing errors do not enhance the statements made.
Ok, boomers
Telling young insurance professionals to “listen during a CE class” is really missing one of the larger issues, which is that there is a huge mentorship chasm in insurance, particularly on the brokerage side.
‘“How many people have joined our industry since 2001?” she told Canadian Underwriter. “They’ve never seen a hard market before.” Her point being that today’s insurance professionals simply haven’t had a lot of time to amass any sort of institutional knowledge.’
On the one hand, there really is enormous value in first-hand industry experience.
On the other hand, the “wise old white heads” of insurance have had, by my math, 18 years to impart that institutional knowledge.
If the pace of this industry is so glacial that the arcane secrets of ‘market cycles’ can’t be passed along in two decades, perhaps it needs that new blood more than I thought.