More than three-fourths (78%) of U.S. insurers expect modest revenue growth during the next 12 months, and about half (49%) plan to increase staff.
However, it seems many companies are “hiring to backfill key positions and bring in new talent, rather than hiring for growth, given revenue expectations,” according to Jeffrey Blair, senior vice president at The Jacobson Group, commenting on the labor market study for the third quarter conducted by the executive search firm and Aon.
The survey showed that 11% of carriers plan to decrease staff, up from 7% in January but down from 14% one year ago. That leaves about 40% planning no additions or cuts.
Carriers that are adding staff say the primary reason is they expect an increase in business volume (36%), or an expansion of business or new markets (34%).
Commercial lines property/casualty (P/C) insurers are the most optimistic about increasing revenue with 84% expecting growth, compared to 65% of personal lines P/C companies and 75% of P/C insurers writing both, according to the survey. Also, 82% of life/health companies expect an increase in revenue.
In the Jacobson/Aon January report, a slightly smaller percentage of companies — 72%— said they expect revenue growth during the next 12 months.
The most common reason carriers cite for reducing staff is automation, followed by areas being overstaffed and reorganization.
The study reveals that the average six-month voluntary turnover was 5.3%, or 2.3 points lower than the 12-month average of 7.6%. The average six-month involuntary turnover was 3.4%, 0.2 points higher than the 12-month average of 3.2%.
Low turnover is both good and bad, according to the experts.
“Lower employee turnover, both voluntary and involuntary, is a positive trend that may indicate more stability for carriers but also make recruiting for certain positions more challenging if incumbents are not actively looking to leave their current employer,” noted Jeff Rieder, head of Performance Benchmarking, Strategy and Technology Group, Aon.
Technology, underwriting and claims roles remain the industry’s greatest need, according to the report.
According to a Bloomberg analysis of Bureau of Labor Statistics, data office and administrative support occupations in the finance industry — including customer service representatives, bank tellers and insurance claims processors — are projected to experience some of the largest employment declines over the next decade, in part because of artificial intelligence (AI).
The national and regional carrier participants in the Jacobson/Aon survey represented about 10% of the industry employment sector and were primarily from the property/casualty sector (79%), followed by life and health insurers (21%). The average number of employees was 1,807, with 31% having more than 1,000 employees; 42% having less than 300; and 27% having between 300 and 1,000.
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