Approximately 68% of the survey respondents said they were likely to recommend the claims profession to other people. (Photo: Number1411/Shutterstock)
For the past 20 years, Claims Magazine has been tracking the salaries of claims professionals, the benefits they receive, how their jobs have changed, and what they see in the future for the industry. This year, the experts within ALM Intelligence, a division of Claims' parent company, ALM Media, LLC, conducted the survey.
Multiple Claims surveys over the last several years have indicated that a significant number of claims professionals (almost 30%) will leave the industry due to retirement. Recent figures from the U.S. Bureau of Labor Statistics confirm this finding to some extent. In 2019, there were 332,900 claims adjusters, examiners and investigators. The Bureau predicts that the industry will see a 6% drop in employment from 2020-2029 or a loss of 21,400 jobs over the decade. Auto insurance appraisers held 15,900 jobs in 2019, and the Bureau expects to see a 4% drop job in employment over the next 10 years or a loss of about 600 jobs.
While we asked the traditional questions about the number of hours worked per week, the benefits provided and annual company sales, we were also curious about the impact of the coronavirus on claims. Initially, the number of claims dropped significantly as businesses shut down due to the COVID-19 pandemic. With everyone suddenly working remotely or isolating at home due to exposure risks, auto claims dropped to the point that insurers began refunding premiums to policyholders.
There were still property claims from fire and water losses, but far fewer than normal. Auto claims were more significant when they occurred because fewer vehicles on the road allowed drivers to travel at much higher speeds, resulting in more severe crashes and bodily injuries.
The coronavirus did affect how claims were investigated. Technology played a much greater role as insurers sought to protect adjusters and policyholders. Remote adjusting took on a new level of importance as carriers who had launched apps and were using artificial intelligence for their claims found they provided a vital link to serve customers while keeping everyone safe and socially distanced.
Who's working in the industry
Seventy-five percent of the respondents worked for insurance companies, and 25% for independent adjusting firms. Thirty-one percent of the respondents were females, 67% were male, and 2% preferred not to say. Adjusters, investigators, and appraisers comprised 46% of the respondents. Individuals with the title of manager, vice president, supervisor, director or specialist encompassed 44% of respondents, 4% were CEOs or company presidents, and the remaining 6% worked in positions that supported various aspects of the industry.
In terms of age, the majority of respondents were between the ages of 50 and 70 (58%), with 30% ranging from 30-50 years of age, 6% over 70, and only 3% were in their twenties. While the depth of experience is valuable to the industry, an aging insurance workforce highlights the importance of attracting younger employees to the industry. Fortunately, many universities offer risk management, SIU, cyber risk, actuarial, and other insurance-related courses to expose students to the career opportunities the insurance industry provides.
Respondents were asked how many years they expected to work until retirement. Our findings mirror other surveys in the industry, with over 30% expecting to retire in five years or less. Twenty percent expect to retire in six to ten years, 28% in 11-20 years, and 15% will retire in more than 20 years.
What do adjusters make?
Despite the slowdown in work created by the coronavirus, 61% of the respondents said that the number of hours they worked each week remained the same compared to last year. Only 5% said their hours had decreased substantially, 10% said they had decreased somewhat, 19% actually saw their hours increase, and 5% said their hours increased substantially. While some adjusters work 70 hours a week, the median number was 45 hours, with 94% working full-time and only 6% working part-time.
When it comes to overtime, 45% said they are not allowed any overtime hours, 29% said they worked five hours or less of overtime, 16% worked 6-10 hours of overtime weekly, and only 10% worked 11-20 hours of overtime a week.
In terms of salaries, the highest company salary was $130,000 per year, the minimum salary was $42,000, and the median salary was $75,000. Independent adjuster salaries were slightly higher, with the highest salary at $500,000, the lowest at $35,000, and the median salary at $100,000.
Over the years that Claims has been conducting this survey, the benefits offered have changed a little, in part because technology has changed. The advent of all-inclusive mobile technology has negated the need for a separate GPS or navigation system, cameras and even satellite phones. Insurance coverage — health, life, dental, and short- and long-term disability — is the primary benefit provided. Other benefits include a cell phone allowance, laptop computer or tablet, travel reimbursement, and for 26% of the respondents, a company car.
The majority of respondents, 68%, said they were very likely or somewhat likely to recommend the claims profession to other people. Among the benefits they cited were that it is very interesting and never boring, it allows them to work with clients, they feel the pay structure is appropriate for the work performed and the hours it requires, and it is a dynamic career with opportunities for advancement.
Nineteen percent said they were neither likely nor unlikely to recommend the claims profession, and 13% said they were somewhat unlikely or very unlikely to recommend the industry to anyone. Their reasons for this perspective included the fact that it's not for everyone and does require a special type of person. The job can also be stressful with a lot of administrative responsibilities as well as difficult, requiring long hours with little appreciation for the time invested.
How has the coronavirus affected the claims process from the adjuster's perspective? Thirty-two percent said that it has made communication with insureds more difficult. Seventy-four percent said that new safety procedures have been implemented, 23% have seen their hours increase, and 58% indicated that their remote claims have increased.
The riots, multiple hurricanes, significant wildfires, and a worldwide pandemic have certainly made 2020 an interesting year for insurance claims professionals, and while technology can expedite the process, flag fraudulent claims and accelerate the payment process, the insights and way they represent an insurance company to policyholders should never be underestimated. The insurance claims profession is a vital aspect of the industry that will continue to evolve and presents insurers with another opportunity to serve their policyholders.
Patricia L. Harman (pharman@alm.com) is editor-in-chief of Claims Magazine.
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