We have a serious issue to address in the insurance industry.According to the U.S.Bureau of Labor Statistics, the industry employs 2.2 millionworkers, and that number is expected increase with 200,000 new jobsby the year 2020. This should be great news,except that nearly 50% of the industry'sworkforce will retire in the next 15 years—and there isn't enoughtalent stepping in to fill those shoes. If the insurance industrydoes not work to recruit top talent now, it won't be ableto offset the impending skills gap.

An aging workforce isn't the only driver requiring insurance torecruit new, fresh talent to the industry: Property andCasualty insurers in particular are in a period of flux as theyface significant challenges to traditional business models anddeclining investment returns. As a result, carriers are recognizingthe need to leverage data and analytics—and to hire the talent towork with these analytical tools—to improve overallprofitability.

The need to fill positions is exacerbated by timing—this problemis hitting at the same moment that carriers are retooling theiroperations to become more profitable, which will require data andanalytics talent within IT, actuarial and underwritingdepartments.

At a time when demand exceeds supply, what are some stepsthat secures top talent?

Related: Read "What's YOUR Succession Plan?"

Recognize the Need for AnalyticsTalent

For many years, insurance companies built their businesses andensured profitability by focusing on successful investmentstrategies. The recent financial crisis changed that as investmentyields became more unpredictable than ever. As insurance carrierslook to the future, they've been re-organizing their businesses toensure profitability from their operations rather than relying soheavily on investment yield.

Now, the incorporation of analytical tools has become thestandard amongst carriers in order to stay profitable. In a recentDowling & Partners Research report, the useof tools such as predictive modeling is still a "competitiveadvantage for insurers that use it, but it is beginning to be adisadvantage for those that don't."

A research study by analyst firm SMA furtheremphasizes how carriers are increasing their technology investmentsto improve overall performance. As underwriting is often consideredthe foundation of growth and profitability, it's not surprising tolearn that the top area for technology investment in 2013 was dataand analytics initiatives that support underwriting, with 55% ofinsurers increasing spending in this area. Other investmentssupport marketing (46%) and claims (37%).

In fact, when Accenture polled more than 550 North Americancommercial lines underwriters, 72% of respondents cited thatmaintaining underwriting discipline and pricing was their topchallenge. And half of the underwriters surveyed said they needbetter access to intuitive tools that provide data and insight atthe point they need to make a decision.

Develop Talent with STEM Education
Despitethe growing dependency on data experts, the question remainswhether there is enough qualified talent out there to fill our openpositions. The insurance industry is not alone in this need torecruit the top talent available—we're competing with lots ofindustries for workers who have degrees in science, technology,engineering and math (otherwise known as STEM), and we'renot in good shape as a country. Across all industries, we will havea shortfall of 3 million positions requiring college degrees thatcannot be filled by 2018.

As we recognize that we are competing for a limited pool oftalent, take steps to develop and encourage STEM education. Thereare a variety of organizations and programs, such as Change theEquation, which aim to connect the dots between STEM educationand building the workforce pipeline. When looking at the list ofparticipants in initiatives like this, the insurance industry islargely absent from this effort, especially when compared toinvolvement from other sectors.

With many jobs to fill within the coming years, it behooves theindustry to take a more active role now in building a strongeducational foundation for our future workforce. Valen has begun aninitiative, called Tomorrow's Talent Challenge, to help the insuranceindustry work collaboratively to reach the next generationworkforce. The Jacobson Group, which has an EmergingTalent recruiting program, also partners with Valen to coordinatean industry-wide effort to attract new talent.

Showcase IndustryStrengths
As we know, insurance is comprised of muchmore than sales positions. Showcase what the insuranceindustry has to offer by correlating the personal interests ofyoung professionals with related career paths. For instance, theindustry employs claims adjustors who assess customers' policies(ideal for someone with people skills), appraisers who offerassessments (for those who don't want to be bound a desk job),investigators (for those who are resourceful in gatheringinformation), as well as underwriters and actuaries who can pullfrom their interests in business and finance to assess data.

Remember that exposure to the insurance industry is extremelylimited for many young people. Paying high premiums or having towait for long periods of time to reach customer service can lead tonegative impressions of the industry. As such, be sure to emphasizethe various positions within the industry as well as other keytraits that make insurance so appealing, such as job stability,family-friendly and flexible work hours, and great benefitspackages.

Coach and Mentor Emerging Talent
Runningsuccessful internship and mentorship programs is a great way togain a positive reputation amongst your community. This is a chancefor your business to showcase a real "day-in-the-life" of variouspositions, but it also gives back to interns in a positive way byteaching them entry-level skills needed for a permanent position atany insurance company.

This is something that the financial industry does reallywell—take a peek at any "top internship programs" round-up and you'llnotice that many of the companies listed are in the finance sector,such as JP Morgan Chase, Ernst & Young and Merrill Lynch.That's because their programs often provide hands-on experience forinterns allowing them to weigh the pros and cons of a positionbefore pursuing it further. Also, many successful programs allowinterns to dive into tasks that start off easy, with room toeventually take on more challenging tasks that require students toutilize the skills they've learned at school or at a previousjob.

While some may think that internship programs are time-consumingto run, consider the fact that interns are potential hires thatyou'll make once they graduate or complete the program. Invest inthe personal development of your interns and take an active rolewith training now, and you'll soon see the rewards of yourmentorship and guidance.

Broaden Your Reach
In the midst ofheadlines about healthcare reform and disaster relief, now is thetime to educate youth about the opportunities within insurance.More than 40% of college graduates are unemployed and another 16%are in part-time positions. This means that there is a need byinsurance to fill in jobs at the same time that many people arelooking for work.

Don't limit yourself with recruiting efforts. The NationalCenter for Education Statistics estimates that less than 1% ofcolleges are reached through traditional campus recruiting, whichleaves thousands of candidates overlooked. Also, considerbroadening recruiting requirements to consider those withassociate's degrees for your internship programs as there arepeople of various degree levels who are eager to participate. Alook into the life of an insurance company may be exactly whatpersuades them to earn a bachelor's degree or secure theircredentials.

As young professionals are more diverse and technology-savvythan ever, the pool of talent is there. Foster a company culturethat encourages people to explore insurance by taking an activerole in education programs and internships. The responsibility lieswith us all to start thinking strategically now in order to avoidfuture crises.