The insurance talent time bomb and what to do about it

Talent has become one of the biggest priorities in the insurance industry in recent years. With many experienced professionals approaching retirement, there's a growing skills gap that needs to be filled.

In a crowded market, skilled employees can give insurance companies a competitive edge. They bring fresh perspectives, creativity, and expertise, which can lead to improved products, services, and customer experiences.

So how do insurers attract young promising talent to the industry? How do they keep their current employees motivated and well equipped for the digital age?

In our debut episode of the TEC Talks podcast, TEC sits down with Claire McDonald, executive board member of HDI Global, to explore how the industry can tackle that ticking talent time bomb.

Mentioned in today's episode:

• The ISC group for women in insurance

• iCAN: The Insurance Cultural Awareness Network

• Discover Risk workshops by the Chartered Insurance Institute

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Full episode transcript

[00:00:00] TEC: Hi, I'm Tom Chamberlin, VP of Customer and Consulting at hyperexponential, and your host, otherwise known as TEC. In this episode, we're talking to Claire McDonald, who's a member of the executive board at HDI Global. So let's get straight into it. To kick us off, Claire, we have recently surveyed a number of leading insurance companies to understand their shift in priorities over the past five years, and saw talent as been one of the biggest increases in priority.

What do you think sort of driven this more recent focus on talent for both hiring and retaining, and why do you think it perhaps wasn't such a big priority in the past?

[00:00:43] Claire McDonald: Thanks Tom for the question. Yeah, I think there's a number of things that have changed over the last few years, and I think Covid is in the mix there as well. But I think if you look at most insurance companies, if you look at the age profile of most insurance companies, It has been gravitating towards a higher age bracket generally over the last few years.

So we're seeing people retire, but we've had, our young people have now got, I think, so many more options and some of which seem to be more attractive and exciting than insurance, let's face it. So I don't think we're necessarily getting the same people choosing things, choosing insurance as an option. I think also, Now until recently, the apprenticeships, the graduate schemes, they all seem to die down.

You know, stuff that was there in the eighties, nineties, early two thousands, I think post economic recession, we saw some of those schemes go out the window. So we haven't seen the people coming through, and I think we've got quite a bit of a shortage of people in their twenties and thirties. Certainly those are the the age groups that I'm seeing that are really going at a premium where it might be like second or third jobber.

Where, you know, normally in the past there was probably quite a few and, and there just isn't so, so people are looking for people. The market conditions have been good over the last couple of years, particularly on the insurance company side of things. So companies have wanted to expand and to grow. The people have not been there for them to hire.

There's a shortage. And then in addition to that, we've got many people who have decided to either go part-time or do different career choices post covid. It's caused some people to reevaluate what their. What their working decisions look like. So I think it's a combination of all of those different things really.

[00:02:28] TEC: Yeah, that, that kind of makes sense. I, I wonder what would happen if we'd looked back a sort of bit further times when sort of you and I were joining the industry. I definitely remember, as you said, those graduate schemes. In fact, I was kind of part of one at

[00:02:40] Claire McDonald: When I was on an A level training scheme, probably quite a bit before you. But that was what attracted me to the industry, was to join a job at 18 where there was a clear training program. And, and I felt, you know, and progression was linked to, you know, your exam qualifications, how well you performed on the job.

And I felt I could see a structured career path that gave me, you know, incremental salary as well, and that, that I would be invested in. You know, it's that sense of investment, isn't it? And I think a lot of people are looking for that.

[00:03:13] TEC: Right, right. Yeah. They, they, they spend. Of time training you, as you said, you get your incremental increases. I, I trained as an actuary, so there was actually quite a formal way through the, the, the, the sort of career path and quite clear sort of set boundaries. You passed this exam, you get a bit more money, you get to this level, et cetera, et cetera.

And also as part of that scheme, you got pushed around different areas. So I worked in a bit of reserving, a bit of pricing and, and all over. And there, there was a lot of opportunity to do that. I mean we, we've, we've both benefited from this and it seems strange then that. Companies have decided that they're not gonna continue to do it.

Is is it a budgetary thing or is it..?

[00:03:48] Claire McDonald: Particularly in the UK, I think it's good. You know, the apprenticeship levy. and, and what that’s meant. That has meant that we're now seeing the return of apprenticeships. But I think the other thing, now, obviously we've gotta now compete, you know, amongst other opportunities.

And the internet shrinks everything, doesn't it? You know, in the days I was applying for job, I, I got it through the career center. There wasn't an internet and, and there wasn't a way of finding out, but now the internet shrinks things as well and makes so many other opportunities so, so, so much more easily visible that we, we are now competing, you know, for that, for that resource pool.

[00:04:29] TEC: And is it just, is it that are, are other industries doing better? Cigarettes advertising these potentially more interesting looking, exciting kind of industries. And the the funny thing is right, insurance is genuinely interesting. You and I are both here and, and have thoroughly enjoyed our times, but people don't necessarily see that un until you're in it.

[00:04:49] Claire McDonald: I think yes and no. I think, I think if we talk about, if we talk about corporate insurance, specialty insurance, some of. Some of that sort of stuff then yeah, it really is interesting. But there we have to accept also there are parts of insurance that are probably quite not so interesting for, for a new graduate.

And I'm talking, and I don't mean to to dismiss any of these roles because you know they are important roles. But you know, the career opportunities practic within a call center. Or, you know, something within, I, I dunno, life and health or personal lines. You know, the, perhaps the bandwidth in terms of the career opportunity is not the same.

But having said that, that's probably what most kids might think of when they think of insurance. Most kids don't think about insuring airplanes or or refineries or satellites. They think about assets that are closer to home, and if they know somebody that perhaps works in insurance, maybe it's somebody working in those and that doesn't seem so attractive.

So I think, I think banking and some of those areas have always appeared to be a bit more sexier. Frankly, I don't think they are.

[00:06:00] Claire McDonald: I think insurance is actually a lot more beneficial in terms of overall good to society and the spreading of risk and you know, enabling companies to do new things. But do I think that we really get that story out sometimes?  No.

[00:06:17] TEC: No, no, it's,  I think you're right and we can come onto sort of a few areas where we've seen that sort of promotion happening a bit, but I'm just reminded actually of a past colleague, both of ours Carsten Scheffel who very much loved his industry and, and I was also asked that question, why insurance and why do you find it so fascinating?

He said, well, actually you don't, you experience lots of different industries, and this is to your point, it's like for large corporate specialty type of stuff in particular you do so because one day your. Visiting a, a pipe manufacturer for a massive oil rigs at another day, you are doing something on the aviation side.

And genuinely, even, even when I was coming in, you know, I was, I trained as an actuary, but if I'd just known more about the underwriting side of things, particularly stuff like entertainment, I had no idea this, this, even, this line of business existed when I was, when I was joining. And even then, some of those roles were not immediately obvious.

And, and I think you're right, unless you know someone in the industry. And, and they can sort of bring you into it and show you what it's like. You, you have no idea. And that's actually something in, when we were both to ambulance, they did with a, with a local school.

[00:07:23] Claire McDonald: So the last couple of years the association, I'm involved with IWIN, which is Insurance Women's Inclusivity Network, which is part of the part of the guild. Insurance Guild, there's the Lord Mayor's appeal every year, and it's about, it's about encouraging girls from diverse sort of socioeconomic backgrounds to consider jobs in the city.

So these are schools generally in London or around London for whom picking, you know, we've got a lot of people on our doorstep and they don't think that the city is for them. So it's about breaking down that barrier. So, you know, one of the things that the CI does, they have this fantastic game. So if anybody's watching this from a school, get in touch with George Tsounias at CI, you'll find him on LinkedIn, and he's got this game called Discover Risk.

And we did it, you know, as part of the weekend. B. We had a class of, of, of sort of four 15 year old school girls come down from, I think it was like, Hartford Sheway. And, and we ran this game with them. And it goes through like five different scenarios and tries to get them to think about risk. You know, what's the risk in this, what could be insurable, what might not be insurable.

And, and it's a really, it's a, it's a really fun couple of hours. But it really just shows you where the risk can be in different things. But it has an entertainment scenario, for example, as a movie scenario, as a chocolate company, as an oil company. Um, but it just goes through different things. So I'd put a shout out to them if any schools are watching this and, and they wanna do something about, you know, getting their kids interested about the prospects of, of what insurance can offer.

[00:09:06] TEC: I think that's, I think that's a great idea. And I'll see if we can, I can use my, my wife's network as well to push it out a little bit to schools because gen genuinely, as you said, even, even in the city around, well, around London, these kids would not normally be coming into that square mile. They don't…

[00:09:22] Claire McDonald: And we need them.

[00:09:23] TEC: I couldn't, I couldn't agree more. You know, the, we've we saw this with, Lilian Baylis School, which, which we did, and we brought 20 to 30 kids into the, into the, office a couple of times and did something similar along what you were talking about, just explaining how insurance works, what it is.

But we had people there from, from it, from underwriting, from claims, from all these different areas. And the kids were, quite frankly, jobs math go well, they, they had no idea. All of these different things existed within it, and I know as a direct consequence of that, some kids have actually gone on to have some careers now in in insurance, which.

[00:09:59] Claire McDonald: Yeah, well one works for our old employer, so

[00:10:02] TEC: Yeah, absolutely. I think you were, you were mentoring them as well. Right. But it, but it's really great and  I actually put mine off, unfortunately, my mentee went and became an accountant. that's how, that's how exciting it was for him. But then again, it, it comes back to that thing.

It's like, unless you know someone in insurance or have been introduced in this way, You wouldn't think to apply there, you would, you, you just would, you would not tick it off your list of things to do and wonder what more we can also be doing to, to, to promote it further. Because it, it does seem like it's happening, but it's, it is in pockets of places, rather than as this kind of mass industry that we're really attracting all of these people.

[00:10:38] Claire McDonald: Well, I think, I think it's incumbent on us as, as people that probably got extensive networks to, you know, multiply. Events that we know of about, you know, networking opportunities, other things that are happening and, and to try and get, I mean, I've got my son at uni, so this event next week, I said to my son, who's your placements director?

You know, cause he is studying business. Um, and part of that course is compulsory placement. I said, right. I said, who's your placements director? Cause I, I would like to email them with details of this event. So, I mean, we've, you know, a range of us have probably got university aged children, probably doesn't take much to get a contact for a placements director or a careers mentor that's at some of these universities.

And start sharing some of this stuff with these, with these people that at least the students when they're, when they're starting to look for a job, can say, okay, well I've heard about insurance or I've heard about a particular facet in insurance. and, and that actually seems interesting to me because I think the more we get, the more we share what's actually going on.

And as you said there, there's quite a lot of activity going on. I don't think, I don't think networking. Networking has come back post covid with a vengeance. Right? And people want to connect and people want to get together. And I think there's also a lot of young, young men and women that wanna wake up from those covid years.

You know, that's, that's, you know, good two, three years out of their lives that they've lived in a weird way. And, and, and they, they wanna get back into it fullheartedly and, and. I think there's a, as I said, there's lots of events and lots of things going on, so, you know, look in Eventbrite, look in other sources, but look in LinkedIn.

But you know, in our age we can certainly act there's multipliers and use our contacts within either educational or university to, to get that message out there. Cause I'd love to see more people, you know, looking for these, looking for these jobs. Cuz as I said, I think it's a fantastic career. You, you can have in insurance, you can do lots of different things.

We've both done quite a lot of different things and it's not a, it's not one job till you retire sort of concept. There's, there's lots of different things you can do along the way, which I think makes for a rewarding working life.

[00:12:56] TEC: Yeah. Absolutely. Absolutely. And I think now with, with all the return to work stuff, you know, this is, this is probably more now on the on, on retaining people once they, once they're actually in, but. There was, there was a big resistance initially for everyone to be going back into the office and people were quite happily working remote.

But I've been chatting to quite a number of underwriters recently, and on the junior side, they, they value so much this being in the office and sometimes as, as sort of more senior members of the team that's forgotten that you probably went through your career sitting next to people like you. You, could you ask any senior underwriter in the industry?

Name some of the people who influence you. They, they, they will talk about people who they sat next to and just sponged information off and built that network with them. I'm glad to see we are, well, I'm, I'm, I'm absolutely with hybrid working, but sometime in the office as well to have those sort of connections and then take advantage of these, of these networking things as well.

It's, it's really good to see that we're, we're doing that.

[00:13:53] Claire McDonald: I think we owe it to the youngsters, don't we? You know, we don't wanna leave them at a disadvantage. I think it's a question of paying it forward a little bit, really, isn't it? That. There's no point knowing everything that, you know, if, if when you retire, nobody else knows it. So a healthy combination of being in the office and being out of the office or managing your day appropriately, that you can still invest time in other people.

I think, yeah, it's really important the more senior you are.

[00:14:22] TEC: And do you think we're doing. Enough, you know, if, if we're getting slightly better now, we're just starting to get some of the younger talent in, are, are we doing enough to retain them at that sort of early career stage? I, I've still seen some people who do a year or two and then pop off to go and do something else, which is obviously then disaster.

We've done the hard work getting them in, but are we, are we doing enough to, to keep people interested?

[00:14:46] Claire McDonald: I think you could a bit more, you know, it's understanding. What is it that motivates that individual? Is it career progression? Is it, you know, for some people it will be salary, but for most people it's a sense of full momentum. And how are you delivering that? And is that you are finding other opportunities within your organization to keep that person interested?

You know, I know for me, I would've definitely left, I mean, our previous employer. After eight years, if they hadn't of said, actually, we don't want you to leave. Why don't you think about doing this? And, and it wasn't something I necessarily thought about. So I think as an employer, we've gotta understand what the individual's actually looking for.

The individual may not be fully aware of what the range of opportunities might be or what might be a best fit for their skillset. So mentor, talk to people. And try and match them up. I think, I think being a manager is a matchmaking service often, you know, because you have to try and find the right people in the right homes at the right time.

And sometimes that may not be a job that they've ever thought about doing. I mean, I had a colleague once and and they thought that underwriting was the place for them actually. I was explaining, well, what is it you like about your current permanent change? And I'm not sure you're gonna get that from underwriting.

You know, actually this person's now a distribution and that's been a really good fit for them. So I think sometimes it's, it's okay, what is it you like? What is it you're looking for? Okay, have you thought about this? Have you thought about that? And you know, and a few years later, that person's still with the organization.

Another thing that my company's do doing recently, which I really loved, is we've launched like this international young professionals network. So they're visiting different offices as a group. and there's probably like 20 to 30 in terms of age range, you know, it might be first or second job. But again, it's about trying to encourage that, that networking within an organization, encouraging that loyalty, that feeling of investment in, in them and, and that we value, we value them.

And I think, you know, that all helps in terms of the retention levels.

[00:16:52] TEC: Yeah, nothing you touched on before the, the investment side. It doesn't even cost too much to do things like this. And they're, they, they love the fact that their employer has done that and. Taking the time to do it and you will retain it for a lot longer. It's, as you said, it's…

[00:17:05] Claire McDonald: And they’ll feel special and they are special.

[00:17:07] TEC: I'm just, I'm so glad to hear that employees are, are doing more of that now and I mean even, even in paca they were doing a fair amount of it, but I think there's still a lot, as you said, as well placed on the manager and a lot of responsibility and making sure, as you said, you, you are matching them up and people are getting developed in the right way.

And actually development conversations are development conversations. I've definitely not had that all the way through my career and there's been some points where. Development conversations happen once a year. Cause you've gotta fill out your plan so that it can tick a box.

[00:17:34] Claire McDonald: Having said that on the, on the development side of things, Believer, you have to own your own development, right? It's not gonna come on a silver plate and be handed to you that here's your next opportunity. You've gotta work for it, you've gotta earn it, and you've gotta push for things.

[00:17:47] TEC: Yeah, you own your own development, but you are certainly enabled by your manager to, to, to go on that path. And I, as you said, I've, I've found an interesting career as well. I've shifted from actuarial into. Strategic role and then out into underwriting and got to experience all of these cool different things.

But that was, that was off the back of conversations with people who helped guide me and helped understand where, where I could sort of add some value and where I actually really enjoyed working. And I never dreamed as when I was, sort of head of pricing where I actually going into underwriting. But that was an amazing experience and, and something I wish I'd done some earlier, but.

[00:18:21] Claire McDonald: I went from chief underwriting officer into head of operations. I think putting one freebie out there really for, for anybody in a manager, you know, recognition that comes for free, you know, that doesn't cost anything. And quite often is one of the things that people are, are looking for is some sort of recognition, some sort of degree of thank you or appreciation or just being noticed.

Um, and, and that's, that's at a low cost to an organization. If people are leaving your organization because they feel not seen or not visible or neglected, then you really haven't got too much of an excuse for that one.

[00:18:58] TEC: Absolutely. We, we, we've got a really cool thing going on at, our place where we have an HR system, which is called Lattice, and you can give. Public feedback or private feedback if you like. And we're heavily encouraging everyone to get peer to peer upwards, downwards feedback. And this pops up as a, as a message.

And you, you see it and it's happening sort of throughout the day. It's like, this person has just been replaced by this person. Oh, that's, that's actually really nice. And it doesn't take long. And as you said, it's just, it's that feeling noticed and you don't need a kind of, oh, take you off a big extravaganza for, well to celebrate.

You've done the fact that this, it's just no a, a pure thank you, and that was really great. You, you do smash this meeting and, and added a lot of value and that, that, that can again, cost next to nothing to do. It makes a huge difference. So I'm, I'm all for this

[00:19:43] Claire McDonald: And let's face it, we, we might not think it, but not everybody wants to go for dinner or lunch with the boss.

[00:19:49] TEC: probably true. Although, although we are probably the exceptions.

[00:19:54] Claire McDonald: But even still, you know, I think some people might go, no.

[00:19:58] TEC: I, I could get that. But yeah, just as I said, it's, it is the simple thing sometimes that, that, that can make that huge bit of difference and, and people then wanna stay and, and, and wanna do more. I was also thinking the other day around technology and having access to. The right tools, and, and again, this is, this is part of your job satisfaction thing and insurance sadly, has been a bit of, a bit of a laggard in, in technology adoption, particularly at the, large corporate specialty type of end.

And I'm wondering what your kind of thoughts are on how much sort of technology and sort of been having access to the latest tools and equipment's gonna help retain as well.

[00:20:33] Claire McDonald: For, for me it's about trying to be more efficient around the backend processing. So post bind, that sort of activity, you know, the more we can digitalize that. And make that sort of like a standard process, the better for me on the underwriting side of things, it's about how do we augment or supplement the brain power, because from my perspective in the book, you know, that my company writes it is the big ticket stuff and, and as good as computers are, they're still not quite matching up with the human brain and how the human brain can take, you know, maybe 20, 30 years of experience in this sector.

Things that they've seen. And because the, the computer can only look at what's happened in the past to a certain extent, and you, and they're trying to use that as a predictor of the future, but I still want that human engagement in the mix there. So for me, if it can simplify some tasks, like, you know, we've rolled out software.

In our organization that enables policy wordings to be compared. You know, click of a button and you can see what's different between last year's wording and this year's button, right? Cause I don't need every underwriter to read every single line and try and work out where the brokers moved. Clause A from that was previously on page 27 and is now on page 35.

Yeah. And if the clause is the same, I don't, I don't need the human investment in that. So I think that's really nice when you can make things like that efficient equally, you know, we're looking at how we look at risk engineering reports and can we, can we be smarter about that in terms of how do we pick up the differences or the highlights or the things that we want a person to actually look at versus, versus letting a machine do it.

So for me it's how do I think it is quite exciting, the prospect of augmenting or supplementing the underwriting process. But certainly for the large ticket items from, from my perspective, I wanna keep the people involved.

[00:22:27] TEC: I mean, absolutely. But underwriting in particular, and insurance in general is, is is a relationship driven industry and you are not going to lose that. And that's absolutely here to stay. And, and so and so it should. As you said, technology should be here to supplement and augment and take away those admin type of tasks where actually you don't want a senior underwrite having to key from your pricing system to your policy admin system, or as you said, compare to slips when a computer can do just as good a job

[00:22:56] Claire McDonald: And also to your point earlier, maybe younger people coming into the industry are also less tolerant of some of that stuff.

[00:23:03] TEC: hundred percent, a hundred

[00:23:04] Claire McDonald: Where it's more, more admin based, you know, because they've grown up in a world where Excel has always existed. You know, unlike, you know, me with paper and pencil and lucky if I got a scientific calculator, but they've, they've not known anything else in their lives other than, than Excel.

You know, my son's been doing an Excel course as part of his uni course. He can do lots of things with Excel. I have no clue about what to do. You probably got better idea than me cuz that's, you know, that's what you are, you are getting involved with, you are getting a bit more involved in that side of things.

So these, these, these kids are coming out of uni. Or school with a very different skillset in terms of how to analyze and process data. And I think then organizations do need to sort of catch up a bit because if, if they effectively, you know, going from 2020s and they're going back to like 2010 or 2005, they're gonna feel that in, in much more way than perhaps other people would of a different generation.

[00:24:01] TEC: Completely. I mean, my kids, my kids are completely digitally. You know, but my, my daughters still get surprised when she like pods, my computer monitor and goes, why is that not touchscreen? Everything is, everything is touchscreen and, and easy and super slick and workflow. There's no way that generation is going to be digital in their personal lives and analog at work.

[00:24:22] Claire McDonald: And it's a question about tolerance, isn't it? It's a question about tolerance to live with that, with that setup at work. So yeah, we've got some jobs to do, I think.

[00:24:31] TEC: I think so, but it's, it's moving in the right direction. And remember the, these are also, this generation of kids are also gonna be the future risk managers. And they're gonna be the ones who are working with insurers. And again, if, if they're in a situation where they're not able to be digital and communicate in that sort of way and actually streamline workflows and policy admin and all the rest of that, that's, they're just not gonna stand for it.

And I see companies who are sort of up and coming. Convex is an interesting example. They. They, they, they were tech first and okay. They, they're a new startup, effectively four years old, I think now. And they went, we're gonna do this in a technological type of way. We're gonna build out our tech stacks and, and do it as, as we, as we really want to.

And I saw an interesting presentation with, was actually a panel debate with Stephen Catlin and the other panel members were talking about actually the difficulty of, of attracting the right sort of talent for work. And, and the team of Catley just sat there, went, yeah, we have no problems. Let the sun back down.

And it's, and it's like, huh? And, and, and he's, he's, he's right that they, they were oversubscribed for a lot of their jobs. And, and the reason he gave sort of later was, well, we've got the technology that people want to be working on. So this works really nicely for us.

[00:25:41] Claire McDonald: You know, to to that point. Yes, you can do that in a startup, but it's unrealistic also to suspect in, in, in many companies, you know, that are 50, a hundred years old or even 20, 30 years old, that there isn't a limit of legacy and, and that we're all on this journey, but there's only so much you can spend on any given year to change up your legacy picture.

And if you, I mean, if you start off small and you're building your tech stack from a small base, but a lot of, you know, we've seen an awful lot of mergers and acquisitions in the insurance industry. So most insurance companies are quite big. So therefore, if you talk about change in the, the tech stack and you've now got a change in 20 countries as opposed to one, it's a different proposition.

And it comes with a different digit price tag on it as well. And to how much are your customers prepared to take a price increase to cover that? changeover? Probably not.

[00:26:40] TEC: No, that is a difficult thing and I guess it shows are trying to transform, but it, it, it will take a while and, and perhaps in some areas might not be possible. I genuinely, one of the lines of business I used to work on, I think it had seven different policy admin systems. That's for one subline of business.

That's, it's just absolutely insane sometimes. And that, that just can't, that, that, that can't continue because otherwise people are just not gonna wanna work on it. And I, I've, I've seen, I've seen these sort of utopian sort of states where actually. I was talking about the other day, there's a line of business with one of our clients who basically they get their information from the broker, it copies in an rpa, which unpacks the data, puts it straight into the pricing tool, and then a message gets sent to the underwriter.

You can click on the link, goes straight in, all the data's there ready to go, and then there's live data at the back and peer review's all done sort of internally. And it can be done. Cause I've, I've seen it, but obviously it takes it, it does take some, some effort to get there, but, If you are not on that journey, I imagine that in a few years time that others have, have made that a little bit further, that that will have an impact on, on retaining tm because they're not going to wanna sit there and still be double keying, triple keying and, and, and will go to places where it's, where it's better.

[00:27:51] Claire McDonald: Well, nobody wants to do something that's pointless.

[00:27:53] TEC: Yeah. Yeah, absolutely.

[00:27:55] Claire McDonald: I think generally, we all come to work to try and make a difference or do something that's actually meaningful. You know, if you're recording the same data two or three or four times, then you're probably querying, okay. You know, to what extent am I making a difference here or.

Could a robot not do this for me? To your point about the RPA scripting?

[00:28:14] TEC: Absolutely. And given, given then all of this, all of this, there is still some repetitive work in there and stuff. Um, we, we are a hard working industry. Do, do you think we have as an industry a good, a good work life balance compared to others or hard to tell?

[00:28:29] Claire McDonald: I think we do. I think, I think there's a number of things here. I would say. I'd say insurance is pretty stable from a security perspective. That's a nice thing to have. Right, and And something that we probably took for granted before Covid, and I think we saw in Covid that pretty much the insurance sector was relatively unaffected.

We all were able to work from home. Pay kept going as before. a good thing with insurance is, you know, companies need insurance when they're, when they go through economic recession cuz they might wanna buy more coverage, because they can't afford the self-insured retentions equally, you know, when, when we're in a boom that companies are expanding, they wanna buy more insurance or new companies are setting up.

So regardless of of the economic cycle, We seem to be one of the industries that remains relatively stable and I think job security comes into that work life balance because if you are not worrying that the sector that you are in is gonna become obsolete or you're not worrying that the company that you are working for isn't sound, and I think there's good governance and good regulation generally within the insurance industry, then I think that's something that we take for granted that we don't worry about on a day to day basis.

And that other people in a lot other industries, Have to worry about that hospitality sector as an as, as, as a case example. And then I think in terms of worklife balance, yeah, okay. There's gonna be moments where you have to work late or you might have to do the extra hours, but generally, as a rule, it's pretty civilized in insurance.

You can, I mean, I've, you know, I've brought, I brought my son up and, and you know, I can honestly say I've not, not made it to any of the important things in his life that I needed to be at. And I think there's some industries you, you might not be able to say that. So it's not. It's not a drop at the hat.

It's, it's, you know, most things you can have some control over your diary. Most companies are offering flexible hybrid working post covid. That's also another good thing in terms of making that work-life balance, you know, really work for you. So I think we've got a lot to be grateful for, actually. And I think it's, it's one of the better ones.

[00:30:40] TEC: Yeah, I, I couldn't agree, but I, I've really loved this and been able to enjoy life and as you said, raise a family, balance, balance, all of these things. But yeah, working hard, all the same and, and, and making a difference in, in what we're doing. It's, it's nice. I, I hadn't actually thought recently about the.

About the stability side, that that definitely shouldn't be underestimated. It. It is very nice knowing that we are. I guess that that completely against the cycle of, of, of the sort of finance side. You know, insurance is gonna be here because we, we are gonna need insurance. And, and, and that's, and that's, that's a nice a, a nice comfort blanket I guess for, for, for what we're doing.

Just before we, wrap this up, a couple more things. If there's something in the industry that you could maybe, maybe, so we've been talking about, it can just immediately change to, to, to make it all for the better wave of magic wand. Where Well, what it's such a thing with possible, what, what, what would it be?

[00:31:31] Claire McDonald: I would love to see a lot more women in senior leadership roles. You know, it's as 2023. The balance is a long way off. So, you know, for, for my side of things, you know, sometimes you see more risk managers that are, that are women. You see more women going into risk management. But you're still not seeing the change at the top of insurance companies.

We are half of the population. I would also like to see as part of that better retention strategies, particularly for women going through, going through various different stages of life, be that family, be that menopause, be that caring obligations. Because coming back to the question that we started off at the beginning of this conversation, the talent gap.

You know, we can't afford to lose 15% of women through menopause. At that age, we can't afford to be losing, losing the, the mums that, that go off to have children and then don't particularly wanna come back or feel like they can't somehow balance that career with their sort of caring obligations, if you wanna put it that way, if it's not equal within their household.

So I would love to see us, you know, being really active around that sort of returners and, and understanding the sort of different dynamics of, of that gender profile so that we could. Keep the 50/50 that we have as generally as intake and try and, and try and have that really come up through the ranks in a way that we haven't got at the moment.

So I'd love to see that cuz I think we've got a lot to lot to bring to the table and, and I've seen too much female talent get lost along the wayside in my 36 years in insurance.

[00:33:10] TEC: Yeah, the, the, the inclusivity and, and making sure that's part of all the journey before people drop off. Yeah, I'm still genuinely shocked we're, we are in 2023 and still talking about this, and it's still an issue. We still need to be pushing it there. There's no excuses for companies anymore. There's, there's, it's out there. Everyone knows this should be done and it's, it's frustrating that it still is not in the right place.

[00:33:33] Claire McDonald: And the frustrating form for me is, oh, we couldn't, we couldn't find any women for this job. Do you know what? There are quite a few of us out there, so just look a little bit harder. So at least have shortlists, you know, that have got some gender representation on them or, you know, something. But, at least look, you know, that you, if you presented with, I know an all male shortlist for a particular senior role, ask your recruiter to work a little bit harder.

[00:34:01] TEC: Absolutely. Yeah. Again, no excuses. Cool. So the last thing then I can ask the same question to ever really. What, what do you think insurers rein, insurers MGAs need to be doing now to prepare for, potentially inevitable softening of the, of the market? What's, what, what's the sort of top thing they should be thinking about and doing?

[00:34:21] Claire McDonald: First of all, I like to try myself, tell myself it's not cause otherwise it gets too depressing. I would like to hope though, I mean being serious about soft. Right. This particular market cycle, I don't think it does any favors. This, this rollercoaster that we all seem to go on, you know, every few years.

I don't think it does the client any favors. I don't think it does the insurance companies any favors. So I'd like to see that maybe the, the hills and the troughs weren't quite so steep each time because. The hill is a direct response to the trough that you're just coming out with. And, and then you sort of like have to try and, you know, you have to try and recover the, the money that you've lost or, or money that you haven't quite delivered on in terms of, you know, shareholder value over that next period of time.

So I'd love to see it even out a bit more, but I think from, from an underwriting perspective, an insurer perspective you know, certainly what we are talking about now is training. It's training it's skills. It's, you know, oh, have we really, you know, have we really got our underwriters as equipped, equipped as best they can be?

It's about data. So you know, at what point are you in the market cycle? Do you really know? So are you not, you know, nobody wants to be naive capacity. Nobody wants to, you know, you don't wanna be the first to start that ball rolling. So it's really about, you know, do our underwriters really know where we are in the market cycle?

Have they got the tools and, and the information to, to hand that helps them navigate? Because I, I think I call it the shoulder seasons, you know, it's almost like the top and the bottom of a market cycle or the easy places. Knowing when to maybe give a little bit, but don't encourage the avalanche on the way down.

And equally, when is the point to turn to come up? These are the tricky bits to navigate, and this is where underwriters earn their money because at the end of the day, we all want a sustainable result, and we've all got demands from shareholders. They don't change very much year on year, regardless of the market cycle.

So I don't get a, you know, well the, well the shareholders want a lower dividend because you're going in the softening market. That's not what happens, you know, they're expecting the same amount of dividends. So we have to try and, you know, do good, really good risk selection. I understand which accounts we're prepared to walk away from, at which, which, which prices.

And so that comes down to data, information, and training for me.

[00:36:51] TEC: And yeah, the, the skills and the training is, is, is crucial. Most of the underwriters won't have experienced a softening, well, a hard to a soft market. They'll experienced a soft and then eventually hardening, but not the other way. And as you said, no way to give a little or not give a little, and, and trying to, trying to stop the avalanche.

[00:37:09] Claire McDonald: And for which accounts, you know, the risk selection part comes into it, you know, which accounts do we wanna flex on, and which accounts do we actually say sorry, but, but this is a no go for us. And, and, and we're prepared to come away.

[00:37:24] TEC: It's very sensible. Yeah.

[00:37:26] Claire McDonald: because there's no amount of premium compensates for a major loss.

[00:37:30] TEC: Completely. Yeah, that's absolutely right. Brilliant. Claire, thank you very much. This has been an absolute pleasure talking to you and yeah, thank you very much for your time and, your, your insights into the industry.

[00:37:40] Claire McDonald: You are very welcome, Tom. Thank you.

[00:37:43] TEC: Massive thanks to Claire for that. That was a brilliant conversation. So much valuable stuff to take away. And fortunately, we'll be speaking to lots more brilliant people at the cutting edge of the industry throughout this series, so do stay tuned and well, that concludes our first episode of TEC Talks.

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