Kiln’s Chief Executive Edward Creasy in his speech to the Insurance Institute of London (IIL) this week, sent a strong, and much needed message. As reported on the Lloyd’s web site (www.lloyds.com) , he said the insurance industry has to “shed its inferiority complex and sell itself as an attractive career choice if it is to succeed in the battle for talent.”
“Some of the observations I have read and heard about make our industry a dull place to be,” he stated. “We should not be shy about telling the world what we do. Let’s get rid of the EC3 inferiority complex.” To those not familiar with the City of London, EC3 is the postal zone in which the vast majority of London’s insurers and brokers, notably Lloyd’s, have their headquarters.
Creasy also addressed an ancillary concern – how not to alienate those who are already working in the industry. “Are we doing enough to get the most out of the people we have already?” he asked. “The skills shortage can be reduced if we nurture our people and build succession planning into the business. When a company is clear about its future then it knows where to get people, and quite often that is right under our own roof. We have a tremendous pool of talent at Lloyd’s and we should not forget that.”
Dan Glaser, Managing Director of AIG Europe, gave his support. “It’s true, this market has an inferiority complex,” he agreed. “Insurance is one of the most exciting and dynamic careers that an individual can have. It’s got a bit of everything; negotiating, accounting, law, product development.”
Lloyd’s also cited the remarks made by CEO Richard Ward at the Xchanging Conference in Brighton, who stated: “I am not being over dramatic when I say that we are facing a workforce talent war. In the future, it is likely that the lack of talent will become a new corporate risk factor. Demand will exceed supply, creating a new valued market for skilled people. The power shift from employer to employees will change the entire idea of human capital, making it a strategic asset companies will compete for.”
However, the Lloyd’s Graduate Program, the LMA graduate portal and the CII talent initiative suggest London’s insurance market is aware of the problem and is trying to do something about it. (See IJ web site Oct. 5 & 8).
Creasy also pointed out that Lloyd’s needs to extend its reach into local markets in order to underwrite specialized business. “We need the right platform, the right expertise and the right locality,” he explained. “If that means Lloyd’s becomes more international then that’s fine by me.”
Creasy also believes that the insurance cycle will be different in the years to come as increased regulation means the market is being watched more closely. “The Franchise Performance Directorate will ensure that some of the irrational underwriting approach of the late 1990s will be very difficult to repeat over the next few years,” he added.
He echoed a specch given a few days earlier by Clem Booth, Allianz Board Member, who told the IIL that cycle management was one of his five challenges facing the industry.
“For the third year running cycle management is the most important challenge for the industry, according to the Lloyd’s Annual Underwriting Survey,” Booth noted. “But has anything changed? Well, the fundamental difference is that the peaks and troughs will become much closer. The peaks will be lower and the troughs may to some extent disappear due to better transparency and regulation. It is an interesting future, one where the massive spikes that occur after external events may not be so prevalent.”
He indicated that efficiency, regulation, climate change and customer values are the other challenges the market faces.
Booth also reminded his audience that “the customer is in the driving seat, remaining the preferred partner is key. People can do on the Internet what in the old days would have involved getting a broker in. So we need to add value. All industry participants must re-earn their right to exist. There is no prize for second place.”
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