November 16, 2018 by David Gambrill
This story is one in a series reporting on the results of 2018 National Broker Survey, conducted by Canadian Underwriter. The survey of more than 800 P&C brokers nationally was designed to identify the success strategies of both producers and principals. Find other instalments in the series here and our overview package in our October 2018 issue.
Where to Find Your Best Brokers
Canadian insurance brokers and agents aren’t getting any younger, and recruiting new highly qualified talent is proving to be a challenge.
Recent demographic research published this year by the Insurance Institute of Canada shows that the broker workforce, with a median age of 44, is much older than average relative to the rest of the property and casualty insurance workforce. The only demographic groups within the P&C industry with higher median ages were adjusters (47) and senior managers (50).
Priority 1 for brokerage owners and principals, therefore, is to find highly qualified talent to succeed those expected to retire over the next decade. But this has proved to be more difficult than expected, based on results from the Canadian Underwriter 2018 National Broker Survey.
Conducted in August, the survey asked more than 250 brokerage owners and principals to identify some of the strongest challenges to their business moving forward. The survey provided a list of 10 challenges and asked brokers to select those that presented “a strong challenge (8-10 out of 10) to your business.” Brokers could select all answers that apply.
Two-thirds (66.14%) of brokers selected “finding qualified workers” as a strong challenge – by far the most identified challenge on the list. The next runners-up on the list were: “Price demands of consumers” (54.72%); “Adopting a new technology” (53.15%); and “Maintaining client loyalty” (48.03%).
So where to find these highly qualified workers?
Poaching talent from other insurance organizations remains a tried-and-true recruitment strategy for the P&C industry. For example, the Institute conducted a survey of industry HR professionals and executives for its 2018 demographic research report.“Other insurance” ranked the strongest competitor for the candidate pool of labour, well ahead of other industries such as fintech, professional services and consulting. Plus, 75% of departing employees expect to continue working within the insurance industry.
But increasingly brokerages may find themselves competing with other industries to attract and retain qualified employees. And in fact, in Canada’s smaller centres at least, brokerages are reportedly poaching talent from other industries to make up for the smaller talent pools in certain geographic territories.
As an example, ommercial brokerage Henderson Insurance Inc. told Canadian Underwriter recently that it recruits some brokers from outside the insurance industry.
“We pull account executives from different sales jobs and different relationship-based jobs and we try to teach them insurance,” said David Reidy, president and CEO of Regina-based Henderson. “There are very few people (in Saskatchewan) who understand commercial insurance deeply.”
The same is true in smaller centres across Canada, says Kent Rowe, vice president of commercial lines at Wedgewood Insurance, which has offices in St. John’s and Corner Brook, Nfld.
“Our industry is facing a pretty significant challenge in terms of ability to attract and retain talent,” says Rowe, who is also chairperson and past president of the Insurance Brokers Association of Newfoundland.
The brokerage has found itself “getting away from the insurance pool altogether” to find new employees, Rowe said in an article to be published in the December issue of Canadian Underwriter. Wedgewood Insurance sometimes hires people out of school and from industries outside of insurance and trains them.
“It’s a little bit of a longer [learning] curve, but our experience has been that it works just as well as doing it any other way,” he says. “A lot of things establish what would be a good producer, or someone who would be good in commercial lines, versus somebody who may not be so strong.”