7 Ways the Insurance Workforce is Evolving

As the talent crisis persists and technology continues to evolve, how are insurance organizations responding, and what are their plans for the future? Research conducted by ReSource Pro this year reveals insight into how the industry is rethinking workforce strategies, roles, and the usage of tech. Here are seven key findings we uncovered.

1. Flexible Work Models Are More Prominent

Since the beginning of the COVID-19 pandemic, insurance organizations have been experimenting with a spectrum of different work models. Today, we’re seeing companies utilize one of four models, which range from the more traditional to the more flexible. These include:

  • Full Return to Office (Most Traditional)
  • Hybrid Enterprise Approach
  • Hybrid By Department
  • Full Flex Employee Choice (Most Flexible)

On the traditional side, companies will have an easier time preserving their culture, though recruiting and retaining talent may be more difficult. Meanwhile, a more flexible approach can have the opposite effect, opening the door to more prospective hires at the risk of weakening company culture. This is likely why most organizations today have settled for a hybrid model, with “hybrid by department” being the most dominant approach.

2. Attracting and Retaining Talent Continue to be Top Objectives

In a survey conducted by ReSource Pro Consulting this year, we asked insurance executives to name the top three objectives of their talent strategy. Not surprisingly, carriers and agencies share similar priorities, with most responding: attracting new talent, retaining talent, and leadership development. Other key objectives for both carriers and agencies include increasing diversity, equity, and inclusion as well as reskilling employees.

3. Carriers Are Restructuring Their Workforce

According to our surveys of personal lines and commercial lines carriers, the majority of organizations (86% in personal lines and 88% in commercial lines) are currently deploying initiatives to restructure their workforce. This is a significant increase from 2022, when 62% of personal lines carriers and 53% of commercial lines carriers said the same.

4. Outsourcing is a Key Strategy

Our research shows that just behind hiring new employees, outsourcing is the top resource carriers and agencies intend to leverage over the next three years. Forty-one percent of carriers said they plan to increase their use of business process outsourcing (BPO) during this time and 37% their use of information technology outsourcing (ITO). Meanwhile 35% of agencies said the same for BPO and 25% for ITO.

5. Insurance Roles Will Transform Thanks to Tech and Outsourcing

As part of our survey, we asked insurance executives how they expect roles to change over the next five years. On the agency side, most executives believe that producers will become more specialized, focusing on larger, more complex risks. Meanwhile, account managers will become more client facing, aided by an increased use of business process outsourcing.

In the underwriting space, executives foresee a greater focus on portfolio management rather than individual risks. At the same time new data science or AI-related roles will emerge. Similar roles will also appear within claims adjustment as entry-level roles decrease due to automation.

6. Most Firms Are Experiencing Increased Productivity

Amid new industry work models, 76% of carriers say their productivity is improving. And despite some firms’ reluctance to adopt more flexible models, 47% of executives say they have seen a positive effect on productivity from hybrid work.

7. Agencies Are Uncertain About Their Ability to Attract and Develop Talent

Only 46% of agencies say they are highly confident in their ability to attract right-fit talent and only 39% are confident in their process to develop the next generation of talent. When looking at agencies’ strategies for developing leaders, 35% are providing leadership training and education and 27% have a mentoring program. Surprisingly, 26% of respondents said they have no leadership development plans. Other, less common strategies include an agency succession plan (9%) and rotational assignment (4%).

Recommendations for Carriers and Retail Agencies

In the midst of these changes, what steps should insurance organizations take to prepare themselves for the future? Here are our recommendations.

  • Develop a Long-Term Talent Strategy – Your approach should take into consideration the ongoing evolution of the workforce, roles, and technology.
  • Create an Innovative Culture and Work Environment – Develop an effective employee value proposition and go beyond traditional thinking.
  • Build a Dynamic Partnering Capability – Consider how to transform your organization and utilize technology to enable rapid partnering.
  • Choose Your Resourcing Partners Wisely –Ensure the partners you work with ultimately fit within your organization’s culture.

To discover more insights, visit our research page, and keep an eye out for our full report containing these insights and more in July. Find out how ReSource Pro Consulting can position your organization for future success by exploring our Consulting page.