October 30, 2019 by David Gambrill
It’s getting ugly out there in the war for talent in Canada’s property and casualty insurance industry.
Signs of strain on the industry’s existing staff resources have been reported in all segments of the industry over the past year, be it in brokerages, underwriting divisions or claims departments. It seems everyone has a story to tell about too few people doing too much work, as the industry engages customers who demand a digitized, instant-gratification insurance experience.
The result is that some things are slipping through the cracks, leading to customer service issues.
For example, at the 2019 Insurance Brokers Association of Ontario (IBAO) Convention last week, brokers in one meeting asked an insurer if it planned to hire more underwriters. They asked because a handful of their carrier’s renewals were processed three months late.
One broker provided anecdotal evidence about a colleague placing three pieces of property business with an insurer in July; the renewal notice on one of those pieces of business arrived on Oct. 11, with the other renewals still outstanding. Although the client did not pay premiums during the time that the renewal was being processed, the client’s monthly premium payments changed to reflect a compressed schedule.
“We told the client, ‘Premiums are still what we told you, but now your monthly budget [has changed],” the broker said during one of the Town Hall meetings. “Trying to explain to client that their [monthly insurance] payment went from $110 to $205, they don’t understand that. So that’s a little frustrating.”
As it turns out, that particular carrier was looking to hire more staff. Representatives of the insurer asked brokers attending the session to let them know of any “frustrated” commercial underwriters who wanted to change companies.
Certainly, the industry’s pool of underwriters appears to be shrinking, according to demographic research conducted last year by the Insurance Institute of Canada. The research shows that 2,911 underwriters were employed in Canada’s property and casualty industry in 2012. Five years later, that number dropped to 2,710 – a decrease of about 7%.
Staffing issues don’t appear to be restricted to the underwriting side, either. Several brokers, both at the IBAO Convention and in recent surveys conducted Canadian Underwriter, have expressed frustration at trying to reach people in company claims departments, who simply don’t appear to be answering their phones.
“Claims service has become a major issue re: timely contact and negotiations with the insured,” one broker reported anonymously in a Canadian Underwriter poll about broker challenges, published in September. “Assigning claims [to adjusters] not only out of the city in which the incident occurred, but also out of the province, does not endear [consumers] to the process.”
In one example, Canadian Underwriter learned, getting a hold of a staff claims adjuster in one company proved to be so difficult that the insurer outsourced its call-handling for standard auto insurance claims to an independent adjusting firm — something that is normally reserved for handling a mass bulk of catastrophe claims.
The Insurance Institute’s research shows that the number of claims adjusters in the industry rapidly jumped by 58% between 2007 and 2012 – from 3,358 claims professionals in 2007 to 5,317 in 2012. However, in the five years since 2012, only 274 new claims professionals have joined the P&C industry’s pool of claims staff – a paltry increase of just 5.2%
Brokers themselves are hardly sheltered from the industry’s talent wars. In Canadian Underwriter’s 2019 National Broker Survey, which heard from more than 200 Canadian brokers, fully 69% of survey respondents said “finding qualified workers” was a strong challenge to their business. That’s up from 66% the year before.
One broker in the survey described his or her biggest challenge as “finding and keeping trained staff and being able to compensate them. Brokers are now doing underwriters’ work and there is no more compensation to pass to staff.”
HR professionals in some brokerages have suggested that poaching qualified brokers from competing brokerages is definitely a fact of life within the industry.
We are in strange times, on one hand companies say they are understaffed to handle the demand and on the other hand they have to cut labour costs and downsize.
Insurer, broker and adjuster support for the Insurance Institute of Canada has never been so important as it is today. Continuing education and actively investing in our new colleagues to the industry to master their vocation is a necessary requirement if we want to attract new talent. Doubling down on supporting, being a member, and volunteering with the Insurance Institute is a great way to start filling the gap to support and promote new careers in the industry.
This is very interesting. As a millennial, all I hear is how “there are no jobs”. Perhaps the industry should put more effort into recruiting and training college grads.
There is no such thing is not enough people. Simple example. There is no shortage of people who want to play in the NBA. Why, the pay is great. If the industry is suffering from a shortage of willing applicants, it only needs to look at compensation. Triple the compensation and the shortage disappears instantaneously. The title should read, not enough applicants for jobs that don’t pay enough. Truth. smh
Our industry is also struggling to attract top talents and this problem is only getting worse over time. Remember the Actuary? The long regarded America’s best job and one of the most iconic professions in the insurance industry, dropped out of the top 20 job ranking in recent years. Honestly I’m not sure how we can fight for top STEM graduates against the tech companies and even the bigger financial industry where there are so many lucrative careers out there.
What utter BS. These companies need to stop saying and start doing. There are more than enough qualified people applying for these jobs. The problem lies with the HR departments. If you want to see an improvement in hiring there is one simple solution. Fier your entire HR department and establish a Personnel Department. Move on and get it done. Stop looking for reasons not to do it and JUST GET IN DONE.
Operating a commercial brokerage outside of Toronto presents its own challenges. Until we have all day North and South rail service, it will continue to be a challenge to attract young talent to our firm.
We operate in a unique environment where young brokers would have an opportunity to quickly develop their skills and become specialists. It’s a shame that location determines our « pick of the crop » when we truly want to bring in a new line of leaders to prepare to replace our current line as they head towards retirement. Such a huge opportunity impacted by inadequate Provincial infrastructure!