Despite the insurance industry’s recent record-breaking wave of mergers and acquisitions, virtually every company is facing a potential demographic crisis. The average age of an insurance agent is 59 years old and over 400,000 employees are expected to retire within the next decade.Unfortunately, there’s no cohort of young people waiting in the wings to step into those positions, or at least not one large enough to fill the looming talent gap. Only about four percent of millennials express interest in entering the insurance industry, which makes it all the more critical that companies implement talent retention strategies to avoid any disruption of services and a potential loss of institutional knowledge. Here are some practical tips to retain talent.
How to Retain Talent in the Insurance Industry
Emphasize Succession Management
While companies across many industries routinely list talent retention as one of the most critical challenges they face today, many of them are not making good progress toward addressing this problem. Even worse, turnover remains so prevalent that a recent Glassdoor study found that over one-third of companies expect their new hires to quit within their first year. It’s no wonder, then, that a 2016 Deliotte report revealed that about half of all executives surveyed didn’t think their companies had the people in place to meet their companies’ leadership needs.
To avoid the potential talent gaps that could result from these shortages, the insurance industry needs to invest heavily in succession planning. Identifying high-potential employees and engaging them earlier is an important first step in this process. Rather than relying upon current managers to select the best candidates for promotion or new responsibilities, companies need to institute a thorough assessment process to help identify and develop high potential employees.
Employees who are engaged in learning and development programs also tend to be highly engaged in their work. While they may be learning a great deal on the job, it’s important to offer them the opportunity to learn new skills that lie outside their typical responsibilities. Training that simply focuses on helping people improve performance in their existing roles doesn’t help them work toward future career goals and could well undermine talent retention.
Developing a professional development plan at an early stage allows employees to see what opportunities might be available to them and identifies potential interests and areas of need. These plans also reveal what type of learning tools are most effective for an employee’s development. This is especially important for the insurance industry turnover rate, since many training methodologies in use today were developed for a completely different generation of learners and could be frustrating for newer employees. Diversifying training resources to accommodate varied learning preferences makes it easier for employees to find an approach that works for them and allows them to build the skills they need for future roles and positions.
Address Pain Points
Maintaining a healthy work-life balance is important for many of today’s employees. While salary is still a key consideration for them, schedule flexibility, virtual work-from-home arrangements, and generous vacation are also important employee retention techniques that can impact whether or not someone remains with an employer. While it usually isn’t possible to cater to every employee’s specific needs, collecting feedback using employee engagement surveys and during periodic coaching and performance review discussions is important for evaluating morale and engagement. If the same concerns keep coming up consistently, something should be done to address them before they cause people to leave.
Fortunately, the insurance industry already seems to be taking steps to address potential pain points and improve talent retention for incoming employees. Many companies have turned to virtual teams to provide greater flexibility for remote employees. Although the industry struggles to attract millennial job candidates, more than 70 percent of these employees plan to remain within the industry once they take a position. Among this group, healthy work-life balance ranks among their main reasons for staying, which suggests that insurance companies are doing a good job of addressing potential pain points.
Build Brand Identity
One of the primary characteristics of millennial employees is their desire to work for companies that reflect their values. They expect companies to be diverse and be socially responsible, both on the global stage and in their local communities. If companies want to attract and retain these employees, they need to find ways to promote the organization’s values in ways that are genuine and impactful if they’re to reduce the insurance industry turnover rate.
Fortunately, the core mission of insurance companies is well aligned with the desire to make a difference in people’s lives. With a new generation of customers seeking insurance services to protect their investments, their property, their health, and their families, there are ample opportunities for companies to emphasize how working within the industry can help those people build a better future. Building a brand identity that makes the company more appealing to its employees is among the more innovative employee retention strategies in use today.
Talent retention is expected to be one of the biggest challenges facing the insurance industry in the coming years. With so many experienced employees transitioning into retirement and few incoming hires to replace them, insurance companies must take proactive steps to attract and retain high-potential employees if they’re going to continue to thrive and grow in the future. By implementing a few simple measures, they can begin to position themselves as an appealing long-term destination for new and existing employees.