Insurers faced some uphill battles in 2022, from eye-brow-raising jury verdicts and emerging AI deep fakes to an influx of new claimants seeking compensation for pandemic-related business shutdowns.
Amid the mountain of challenges, the traditionally stable underwriting arm of insurance businesses was put under pressure. In a recent report, Deloitte signaled a clear warning to insurance carriers, asserting:
“Insurers that continue relying on traditional ways of underwriting could start a negative spiral that would be difficult to reverse. They may face adverse risk selection, could drop off preferred lists of distribution partners, and may have a more difficult time recruiting and retaining skilled professionals.”
Let’s take a moment to consider the people factor in this equation.
Underwriting Needs and Balance of Technology and Personal Intellect
Automation and other digital technologies can expedite many underwriting tasks, but underwriting is inherently judgment-driven. It requires being attuned to changes in consumer behavior and what’s happening in the market. It also requires an understanding of how these factors affect coverage and price adjustments. These are things only a human underwriter can manage. Technology can only do so much.
Digital innovations such as real-time, sensor-generated telematic information can augment underwriting professionals’ abilities, but they can never replace them. These technologies are limited to relieving underwriters of mundane, repetitive tasks. Underwriting professionals can use the time they save to focus on more strategic endeavors relating to analytics and stakeholder management.
The Underwriting Talent Crunch
We’ve established that insurance firms will always need underwriting talent, but there’s another problem. Right now, businesses in all sectors are desperately short on talent. In fact, 55 percent of insurance executives see talent acquisition as a significant barrier to growth. Underwriting roles are becoming particularly hard to fill.
Consider these sobering statistics:
- A recent search on the popular job site indeed.com shows nearly 5,000 open insurance underwriter positions.
- The Bureau of Labor Statistics (BLS) forecasts a 2% decline in the job outlook for underwriters over the 2020 to 2030 period.
The BLS stated, “About 8,300 openings for insurance underwriters are projected each year, on average, over the decade. All of those openings are expected to result from the need to replace workers who transfer to other occupations or exit the labor force, such as to retire.”
So, what’s behind this talent shortage?
Several factors come into play, including a lack of interest in insurance, especially among younger generations. Many millennials and Gen-Zs have never owned tangible assets like homes or cars. Instead, they rely on temporary lodging or short-term rentals and public transport. Lacking first-hand experience in insurance, it’s unlikely they’ll naturally gravitate toward a career in this field.
Then there’s the lingering perception that insurance is “just boring.”
Why Outsourcing Underwriting Support is a Sensible Strategy
With an estimated half-million insurance workers expected to leave their jobs in the next few years, firms need to reassess their staffing strategies.
Outsourcing underwriting support is increasingly being recognized as the way forward.
Tapping into the pool of skills offered by a reputable Business Process Outsourcing (BPO) partner can save you the time and money involved in recruiting in-house resources. With this support, you can allow your in-house underwriting professionals to focus on more exciting work and explore a more rewarding career path in your firm.
Underwriting Support Services from Covenir
At Covenir, our underwriting support team can do just about anything – even on short notice. From full policy processing to endorsements, new business, or special projects, we’re here to help your operation run smoothly.
Our clients rely on us for:
- Taking care of day-to-day policy renewals, endorsements, cancellations, and reinstatements in their systems of record.
- Preparing legal compliance notices in line with state regulations.
- Updating digital and paper-based policy records.
- Engaging with policyholders via phone, email, and chat to answer their queries and action their requests.
- Providing support with retention and cross-sell campaigns.
- Generating and distributing policyholder notices.
- Supporting expansions into new product lines.
- Performing quality control and new business acceptance reviews.
We can service both personal and commercial lines with our 100% onshore team. We strive to balance being technology-centric and human-enabled. Our clients trust us to integrate with their teams, systems, and processes.
Ready to achieve more in less time – without sacrificing quality or results?
To learn more about how our underwriting support services can take your firm to the next level, contact us at (508) 471-5031 or info@covenirbpo.com.