NU Online News Service, Jan. 15, 1:37 p.m.EST

The U.S. property and casualty insurance industry has a problemattracting talent and fails to make the coordinated effort neededto find a remedy, according to McKinsey & Company.

The management and consulting firm said that while there isuniversal agreement within the industry that there are problemsattracting talent that needs to be addressed "before they getworse," the industry's attempts to remedy the issue "have beenfitful and disjointed."

McKinsey went on to say that if it fails to remedy the problemit will "eventually compromise carriers' ability to compete againstorganizations outside the industry."

But there are some advantages in place that if correctlymarketed, should bring needed talent to the industry, the firmsaid.

The report released yesterday titled "Building a Talent Magnet:How the Property and Casualty Industry Can Solve Its People Needs,"was sponsored by The Risk Foundation.

After a four-month review involving interviews with leadinginsurers and brokers, McKinsey measured their opinions againstdemographic data to determine the challenge the industry faces. Italso reviewed the state of education and discussed the situationwith faculty and graduates.

McKinsey concluded that "the resulting picture is not a prettyone."

Tanguy Catlin, associate principal with McKinsey, said in aninterview that one major hurdle the industry needs to overcome isthe perception that it is "not sexy or exciting."

To do that, he explained, the industry will need a unifiedvoice. However, while many in the insurance sector agree with theconcept, regulatory and cultural factors pose problems, accordingto executives interviewed by the firm.

"The industry has never been able to collaborate," said Mr.Catlin. "Unless they collaborate, it is unclear how they willovercome the talent challenges."

Other very competitive industries--the hospitality industry, forinstance--have overcome their competitive issues by developing amarketing association geared toward the single purpose of bringingtalent into the industry, he said.

Mr. Catlin noted that while there are a number of insuranceassociations that make attracting new talent a part of theirmission, it is only a minor part and lacks the scale equal to thechallenge.

Among the report's conclusions:

o The property and casualty insurance industry faces threechallenges in attracting high-quality talent: a poor reputation, alimited understanding among high school and college students of theindustry's career opportunities, and a limited pool of trainedtalent.

o There is cause for optimism. The industry's risk managementjobs offer many of the qualities--including stability and socialrelevance--sought by young Americans. The industry's schools ofrisk management and its professional associations provide a readyplatform for attracting and developing these young job-seekers.Finally, the economic downturn has made some previouslyinaccessible high-quality talent available.

o Coordinated actions are required. To take advantage of thesepositive factors, the industry's main participants--insurers,reinsurers, brokers and agents, professional associations andschools--must act with a unified voice to improve the industry'sreputation, build awareness of the industry's opportunities, expandthe number of insurance and risk management degree graduates, andimprove education and training.

o The work involved will be neither easy nor quick. The industrywill need to collaborate in unprecedented ways. It will take yearsbefore significant results will be realized. The potential payoffof upgrading talent will, however, offer a good return on theeffort.