Evolving Trends in the Insurance Industry
In addition to digital and technology adoption, we’re seeing other trends that will also be impacting consumers and our industry significantly.
- Hard Market and Rate Hikes:
If you’ve been in the industry for any length of time, you know it’s cyclical. We are currently experiencing a hard market unlike any other we’ve ever experienced as we exit an unprecedented (at least in our modern lives) pandemic. Supply chain issues, labor shortages, inflation, inventory shortages – they’re all contributing to alter our industry’s delicate balance.
As noted in the Liberty Mutual report, these factors are going to impact consumers over the next 12-18 months, and it will be the responsibility of agents and carriers to explain and guide customers through these changes.
“As the U.S. economy enters a difficult period, it’s essential for agencies to show their value as trusted advisors while also creating streamlined customer experiences. Digital is a key part of that. It can also be a helpful growth lever – our research found that highly digital agencies grow on average, 70% faster than other agencies.”
Talent Acquisition and Work Style Changes:
The U.S. Bureau of Labor Statistics expects over half the insurance industry workers to retire within the next 15 years, leaving a significant gap, as only 25% of the insurance industry’s workers are under the age of 35. The next generation is increasingly expecting employers to be more employee-focused and flexible with work options. Gen Z’ers have proven they prefer employers who are purpose driven and inspire meaningful people-oriented work.
“71% of Gen Z’ers said they would take a pay cut to do meaningful work. When job hunting, more than 60% look for a company whose values match their own and has a purpose that goes beyond just making a profit.”
Asher elaborated, I’m sure you've read the headlines on the ‘great resignation,’ how hard it is to find talent. Honestly, across all industries, we're seeing a huge focus on how we bring new people into the workforce. Quite frankly, the independent agency system was already facing that before many of those trends began. If we look at the percentage of agency staff that are nearing retirement, it is very high, so there is a need to bring in new talent.”
Diversity and Inclusion:
The demographics of the country are rapidly evolving. Population forecasting from the Census Bureau shows a dramatically shifting and more diverse population moving forward. Agents should prepare to be able to reach and conduct business with everyone in their communities in a way that best serves those people. It can be challenging for a small retail location, to be able to identify, communicate with, and gain trust with the diverse population in their agency’s reach, unless they’re adopting and taking steps to implement effective strategies. For agencies also focused on growing and attracting new talent, it should be noted that “83% of Gen Z candidates said a company’s commitment to Diversity and Inclusion is important when choosing a job.”
“We're leaning into this topic because we think diversity, equity, inclusion is going to be an increasingly important part of an agent's culture, how they think about the employee experience, and how they think about hiring,” Asher added. “Representation is really critical to our future, again, just because the more we can meet the needs of the communities in which we work and serve, the better off we will be.”
The insurance industry is going through a period of significant change, with evolving trends that will shape the way agents do business and interact with customers. The hard market and rate hikes, talent acquisition and work style changes, and diversity and inclusion are just some of the trends that will have a profound impact on the industry.
As agents navigate these changes, they must remain adaptable, forward-thinking, and committed to adopting digital tools to streamline customer experiences and drive growth. It is an exciting time of transformation for the industry, and those who embrace these trends and challenges are well-positioned to thrive in the years to come.