More than 130 professionals representing insurers, trade associations, higher education and research are meeting in Atlanta this week to brainstorm ways the insurance industry can attract, train and retain the next generation of leaders.

The Insurance Education and Career Summit, hosted by The Griffith Insurance Education Foundation and facilitated by Demmie Hicks of DBH Consulting, centers on 3 days of small-group working sessions to define obstacles, initiatives and first steps the industry can collectively take to address the talent drain that is already underway as seasoned insurance professionals retire.

The event is unique in its inclusion of academics, advisors and more than a dozen risk management students from universities including Ball State, the University of Georgia, Olivet College, Florida State University, Eastern Kentucky University, Temple University and Mississippi State.

In the first 2 days, participants honed in on three major obstacles to successful recruitment and retention: the industry's poor reputation with the general public, a lack of unified resources to address the issue, and a lack of a unified approach to solve the problem.

By the end of the second day, the working groups had focused on three initiatives: developing a campaign for a unified message, creating a centralized hub for recruitment information, and determining what marketing research is needed to achieve these goals. The development of actionable first steps was to follow on the final day.

Although most carriers and industry associations are already pursuing their own initiatives to educate, recruit and train young people, there has been little or no cross-industry collaboration to address the looming talent gap.

Liz Haar, president and CEO of Accident Fund Holdings Inc. and chair of the Griffith Foundation career advisory council, noted that three of her company's top executives with more than 25 years' industry experience recently retired, with underwriters, claims adjusters, nurses and others to follow within the next 3 to 5 years. And although the talent drain caused by retiring baby boomers is not exclusive to the industry, insurance's “misunderstood” reputation means fewer recruits are coming into the business to take their place, she said.

Using numbers from the U.S. Bureau of Labor Statistics and other sources, Steven N. Weisbart, PhD, CLU, senior VP and chief economist for the Insurance Information Institute, presented a sobering snapshot of hiring in the insurance industry. Among the findings:

As of May 2011, property-casualty insurance hiring was down 6.8 percent since the start of the 2008 recession, compared with an overall U.S. employment decline of 5.2 percent
Claims adjuster hiring from 1990 to 2008 grew only about 1.5 percent per year, with more than 8,000 jobs shed since 2008
From 1990 to May 2011, employment in U.S. agencies and brokerages was down by 37,900 or 5.6 percent
Google, Apple, Disney, the U.S. State Dept., Amazon and the FBI top the list of 150 places where young professionals (with 1 to 8 years of experience) want to work. Insurers Berkshire and USAA came in at Nos. 61 and 81, followed by Liberty Mutual (126), Travelers (128), New York Life (130), Hartford (135) and Munich Re (143).

Tanguy Caitlin, associate principal with McKinsey & Co., discussed the findings of a recent McKinsey study commissioned by The Risk Foundation, saying it painted a “relatively grim picture” of attracting talent to the property-casualty industry.

The report found three primary reasons why insurance can't attract talent: poor reputation, limited understanding among high school and college students of the industry's career opportunities, and a limited pool of trained talent.

“Although there are lots of good risk management schools with almost 100 percent student placement, they can only provide 10 to 15 percent of the talent needed in the industry,” Caitlin said.

Complicating factors include a rapidly aging U.S. workforce: Over the next decade, employees aged 55 and older will increase 25 percent while the percentage of people aged 35 to 45 will remain flat. The problem is even more acute in insurance, where agents and brokers are affected the most, Caitlin said. And because the situation is similar in banking and other financial services industries, competition for replacement workers will be fierce.

Caitlin pointed to accountants, nursing and teachers as industries that successfully addressed the talent gap by initiating cross-industry collaboration and investment to attract young talent. One benchmark is www.startheregoplaces.com, a website created by the American Institute of CPAs, which is designed to educate young people on opportunities in the field. Over the past 5 years, AICPA also revised its certification process and curriculum to increase its levels of professionalism, a move that resulted in a 35 percent increase in hiring, and an increase of 80 percent of schools teaching accounting, Caitlin said.

And there are signs of hope for attracting talent in the insurance sector, Caitlin said. “Insurance's value proposition fits well with what Gen Y wants, including a good work/life balance, the chance to explore interesting challenges and make a positive impact on society,” he said.

Another plus are the many good schools offering risk management programs and robust industry trade associations, which could help with recruitment. Additionally, an economy which hit banks and other financial institutions harder than insurance may actually create a deeper talent pool for the insurance industry, he added.

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Insurers, Academics and Students Tackle &ldquo;Talent Gap&rdquo;

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Insurers, Academics and Students Tackle “Talent Gap”