The Changing Industry
By Jeffrey R. Hughes
CEO, GAMA International
Staring across a sea of insurance industry folks, something is strikingly clear: it is a homogenous mass of old white men. For this planar industry to survive, awareness of an evolving three dimensional world is of utmost importance. The insurance “ Old Boys Club” has to cater to a variety of ages, genders and races to accommodate distribution management growth.
A 2010 article in the New York Times estimated that 50 percent of insurance agents in the United States and 70 percent of claims adjusters are over the age of 45, a number that will only get worse as the population ages 1. In Canada, women hold only 24.3% of senior officer positions in insurance and financial services firms. Shockingly, as of March 2011, 30% of financial services companies had zero women in senior positions 2. Now that more women than men are graduating from higher education, this inequality seems archaic.
Consider that minorities occupy a mere 10% of agency head positions in the United States despite making up a 25% percent of the population 3. Though the game is changing, the dice still remain in the same hands, creating a problem as they all approach retirement age. Generation X and Y must be trained and recruited to fill their positions, to keep the industry from becoming obsolete.
In order to continue to be successful, we need to recruit the best and brightest to our industry. A big part of that successful recruitment should include an examination of the current workplace. The number of insurance companies in the US and Canada recruiting inexperienced sales representatives has sharply declined over the past few decades. Now that many in the industry are retiring, the need for new and youthful sales representatives is growing. How can we appeal to them? How do we transition agents into management positions? How do we create a gender neutral environment? All these questions must be answered so the next generation of advisors can rise up and fill the shoes of the Baby Boomer generation.
1 The New York Times: Costonis, Michael and Salkowitz, Rob. The Tough Match of Young Workers and Insurance. June 12, 2010. http://www.nytimes.com. April, 2011
2 Investment Executive: Harman, Megan. Good News, Bad News for Women in Canada’s Financial Services Industry. March 3, 2011. http://www.investmentexecutive.com. April, 2011
3 LIMRA. Krozel, Kathleen. Leading Indicators: Sales Leadership and the Future of Agency Distribution. 2010: Windsor, Connecticut. (p.21)