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Market Insights H1: Claims & Underwriting Operations 2022

  • Publish Date: Posted about 1 month ago
  • Author:by Sam Crayk

​I currently manage the team responsible for Claims, Underwriting and Broking Operations, Regional, and Personal Lines at Eames Consulting and have personally focused on Claims and Underwriting Operations recruitment for over 8 years, partnering with clients across the Lloyd’s and London market.

I have explored and shared my insights on the availability of talent, working through COVID, approach to flexible working, culture, in-demand roles and skills, and more for H1 2022.

Availability of Talent:

Following several significant CAT losses, some positive results from the Lloyd’s remediation and decile 10 work, and the general improvement in rates and hardening market conditions experienced in the last few years, we saw a number of carriers exit underperforming or capital-intensive classes, realigning their strategy and redistributing capacity. This resulted in some ‘profit making’ classes being very much in demand. We also saw a handful of new entrants “the class of 2020” bringing additional capital into the market, as well as continued scale ups. Naturally, new entrants were keen to attract market names with legacy free balance sheets and freedom from the corporate bloat that many firms have suffered with, this resulted in movement at a senior level and some significant remuneration uplifts to attract them away from established books.

More generally across the market, I believe that rather than it being a candidate short market, it’s more of a skill shortage within certain functions/classes. In some organisations, there seems to have been a lack of investment in emerging skills, as well as the development of internal talent. Data/MI skills are a specific area that we’ve seen high demand, but short supply. There has also been a lack of succession planning in some classes/functions, with some organisations finding it hard to replace the knowledge leaving the company with internal options.

Due to the above, there is a lot of competition for good quality candidates. Within the claims and operations side specifically, candidates are in high demand and tend to explore multiple opportunities concurrently, sometimes having 2-3 offers on the table. This results in employers competing for talent, driving up salaries for certain skill sets. Whilst previously I would expect a 10-15% increase on the package being the norm, we’ve seen as much as 40% in some classes/in-demand roles. All the above makes for a very challenging market, and historically we’d see this demand in pockets of the industry, rather than across multiple functions as it is now. There has also been a strong shift towards counter offers to retain good talent. We're seeing more counteroffers this year than I think we've ever experienced, resulting in some bidding wars between companies for top talent. This is only adding to the increase in salaries, and I think it’s going to be interesting to see what happens when the market inevitably turns.

It’s important that as an industry we’re focused on bringing in new talent, as well as being more flexible on people outside of the industry with transferable skills. I don’t think Insurance has necessarily been seen as a viable career path, or an inclusive marketplace for a lot of people. There’s certainly a long way to go, but steps are being put in place to help change this view. London and the Lloyd’s market is an epicentre for global insurance, and I honestly think it’s one of the most exciting industries to work in.

Working through COVID

Working through COVID was challenging. Understandably, initially, there was a reluctance for a lot of people to explore other opportunities due to there being a lot of uncertainty, but after an initial lull, recruitment levels picked up and were maintained for most of the pandemic. We did also see an increase in demand for fixed-term contract work at points of the pandemic, which again I would link to uncertainty across the market and a reluctance to hire with the possibility of having to make workforce cuts in the future should there be a downturn.

Approach to Flexible working

One thing that has been interesting to watch is the change in people’s main drivers for moving roles and motivations for choosing potential employers. People’s motivations shifted towards the flexibility of working, which we’re still seeing now. It has been great to see what historically has been a market adverse to change in working practices, evolve so quickly to offer flexible working. I think as an industry we’ve made some huge steps forward and it was evident quickly that productivity could be maintained, even when working from home.

There has been a focus for a lot of our clients on return to the office flexibility, with most opting for three days in the office, two working from home, which I personally feel is a good approach. It allows the market to continue to evolve but keeps some face-to-face engagement, which ultimately is what insurance was built on. Naturally, for some roles, there’s more of a requirement for being in London offices (brokers, trading underwriters etc.), but even for these, we’re seeing a lot more flexibility. I personally feel that set days in the office for certain teams have also been very successful. Some organisations that aren’t mandating team days can find it challenging to achieve a cohesive and collaborative environment, especially when onboarding new staff, some of which have not stepped foot into the office.

Clients that offer good, flexible working policies and are set up well for remote working have also opened the talent pool to regional markets. This has helped us attract individuals from more retail personal lines/commercial lines, which has helped to bring in much-needed skill sets, in particular those with strong data/MI capabilities.

Tools and Technologies

The acceleration and increased adoption of technology due to COVID has really helped to push the industry forward, which has been essential within the recruitment process through the pandemic. Prior to COVID, interviewing and onboarding someone virtually was alien. Although we’re now seeing most processes include at least one face-to-face meeting, there is typically the option for video conferencing at the 1st/2nd stage. It’s allowing a lot more flexibility, as well as the option to bring in stakeholders in other territories into the process. It’s usual for us to be organising meetings across time zones, helping to ensure global alignment of recruitment strategies within our clients.

Streamlining Processes

With ample opportunities for candidates in the market currently, streamlining processes has been essential in securing top talent. Most candidates are in multiple processes, and I’ve seen increased pressure from some organisations to accept offers quickly. Companies with 4-5 interview stages are missing out on good talent, with those able to move quickly and sticking to 2-3 stages coming out on top. I’m still seeing some organisations hiring without meeting individuals face to face and some after 1 stage. This has certainly helped to speed up processes and brings us to the next point on culture, as sometimes people are joining businesses without having stepped foot in their offices.

Culture

Culture and an inclusive working environment are still the main drivers for a lot of the market. Aside from market reputation and looking through company websites, a lot of candidates rely on us for that information. For a candidate to understand the culture and suitability of the employer I feel it’s essential for us to understand our client’s working environment and internal initiatives. We’re asked on a regular basis what the environment is like? How inclusive is the company? What’s the strategy of the business? So our relationship with our clients is incredibly important to answer those questions honestly for the candidate. I’ve been a huge advocate of clients inviting recruitment partners into their offices, arranging for a mix of people from the business to talk through what has kept them there, future strategy, and what initiatives are happening internally. This is something we’re constantly asked about, and I’ve always found we’ve had the most success with the clients that allow us to really understand the inner workings of the business.

I have noticed that a lot of the new entrants and rapidly growing carriers/brokers etc have really worked to embed us into their business. They’re transparent on strategy, and this has really helped us go to market and attract top talent. I expect in some part this may be because we can act as a good marketing channel to the wider market, but it has really helped to ensure we’re attracting the right people to the business!

In-demand roles and skills

In-demand skills have shifted a lot over the years. During the pandemic, we saw an increased appetite for wordings individuals, maybe in part to the FCA’s test case surrounding business interruption coverage disputes. More recently, claims have been particularly busy in certain classes due to significant global events. For example, the Ukraine/Russia war resulted in an increased demand within aviation, marine, trade credit, and political risks. The insurance market is continuously evolving, so we’re very used to these shifts in appetite though.

I’ve also seen more of a focus on industry accreditations, and I believe these accreditations may become mandatory in the future. It’s now expected at an entry-level, and we’ve had some offers through with pay rise clauses included on completion of certain qualifications. This isn’t something we see too often, but for some clients, it acts as an incentive to fast-track entry-level or 2nd jobbers. Typically these courses and revision material will be subsidised by the employer, with this being transferred to a new company should the individual move during, or for a set period after completion.

If you’re a client in need of talent solutions or a candidate looking for their next opportunity, please don’t hesitate to get in touch. Contact me at sam.crayk@eamesconsulting.com