The US Bureau of Labor Statistics predicts that the insurance business will lose around 400,000 jobs due to attrition between 2016 and 2026, presenting a serious challenge for the industry.
Many workers are getting close to retirement age, which only exacerbates the problem. Against the backdrop of rapid technological development, legislative shifts, and altering client preferences, consulting firm RSM underscores this demographic transition.
Because of this skills gap, it is more important than ever to have a solid succession plan in place to maintain continuity in key areas such as leadership. Any lack of foresight in the insurance industry could be detrimental to long-term income and client trust.
The industry faces many issues, including knowledge and skills deficits, a broader talent shortfall, and the need to incorporate new technology. If these problems are not fixed, they could hurt businesses in the long run by making them less competitive, making operations less efficient, raising regulatory concerns, and making it harder to keep customers.
What kinds of expertise are insurance companies looking for?
Skills in areas such as data analytics, cybersecurity, and digital marketing are in high demand, with data-related competencies being particularly important. Insurers are getting more and more value out of data analytics in areas like risk assessment, fraud detection, and client segmentation.
According to productivity software firm ZipDo, more than half of the insurance industry is actively seeking candidates with data analytics experience. The importance of data analytics in facilitating digital transformation, fueling innovation, guiding strategic business choices, and improving the customer experience cannot be overstated.
Factors like data quality, appropriate models and algorithms, and the needs of individual applications can make or break the success of a data-driven strategy. Inadequacies in these areas could expose organizations to fraudulent claims and erroneous risk assessments, harming both financial performance and reputation.
Underwriting and claims adjusting, for example, require an in-depth understanding of data strategy in addition to in-depth expertise in insurance law, compliance frameworks, and risk management methods. From 2022 to 2032, the number of jobs in these fields is expected to fall due to automation and increasing efficiency, according to the US Bureau of Labor Statistics.
An elderly workforce that may lack technological competency faces difficulties during the incorporation of new technology and digital tools. Effectively addressing these issues in the workforce would require widespread promotion of a culture of lifelong learning and skill improvement.
Artificial intelligence, machine learning, and data analytics are just a few examples of how adopting cutting-edge technology may boost productivity, efficiency, and morale. Insurance firms that embrace such ideas would appear progressive and modern, which could appeal to millennials and Gen Zers who choose tech-focused workplaces.
We anticipate a continued high need for expertise in data analytics, cybersecurity, and digital marketing. According to RSM US Financial Services senior analyst Marlene Dailey, “data-related skills in particular will be paramount for various business functions of insurers.”