The Insurance Agency Workforce: Evolving Into The Next Normal

Financial services professionals provide insights on state of the industry, employment trends and technology

DENVER, April 22, 2022 /PRNewswire/ — Vertafore^®, the leader in modern insurance technology, today released its annual insurance workforce survey report, titled “The Insurance Agency Workforce: Evolving into the next normal.”

Based on responses from more than 1,300 insurance professionals, the report includes insights on how independent agencies and MGAs responded to the Great Resignation, what attracts individuals to the insurance industry, factors that can keep employees in seat and how workers feel their agency is responding to technology modernization.

The Great Resignation

If 2020 will be remembered for the widespread shift to remote and hybrid work, 2021 will certainly be remembered for dramatic shifts among workers themselves. In 2021, an estimated 38 million U.S. workers left their jobs. Many accepted new positions, but some left the traditional workspace entirely.

Employee turnover in the insurance industry was estimated to be 11.9% in 2017: a retiring workforce and an attractive labor market outside the insurance space accounted for a large portion of this percentage. However, the current survey results suggest that, for agencies of all sizes, the employee turnover rate has grown to 20%. Vertafore saw this information from both sides. 20% of agency employees said they had changed jobs in the last 12 months; 20% agency owners said they had either “slightly more” or “significantly more” employees leave.

The insurance industry has traditionally enjoyed low turnover rates, but these results indicate a shift that may catch agencies off guard. Compensation, technology, remote work, benefits, and office culture are on the table and may be drivers for job searching.

The Search For Job Satisfaction

Like the prior year’s survey, Vertafore asked insurance professionals why they might leave the industry. And the answers remained similar year over year: a majority of respondents named “retirement” as a reason for leaving the insurance industry.

Repeating last year’s trends, “compensation” and “work-life balance” followed retirement. This data makes sense—2021 was a year when “work-life balance” trended in employment conversations around the world. Agencies benefit by looking at employment factors that lie outside the normal compensation/schedule equations as employees will likely continue to search for jobs that make them happy.

Remote Work Is The New Employee Benefit

In its November 2020 report, the McKinsey Global Institute analyzed the potential for remote work in insurance and financial industries and they concluded “three quarters of activities in the finance and insurance industries can be done remotely without a loss of productivity.”

Even as the pandemic eased, remote work was still top of mind in 2021.

• Most agencies were remote at least some oft he time. Few were entirely in the office or 100% remote.
• Among respondents who changed jobs last year, more than 1 in 4 said they left for remote work opportunities.
• Nearly30% of all respondents said more remote work opportunities would make them more likely to stay with their current company.
• The amount of remote work correlated with an agency’s size. Smaller agencies reported more time in office than larger agencies.
• More than a third of agencies said they added remote work as a retention tool.

Technology Optimism And Implementation

Vertafore asked insurance professionals a series of questions to gain insight into their views on insurance technology. They wanted to know what technology insurance professionals use (and don’t), how they feel about that technology, and if their solutions are truly meeting their needs and expectations.

The results? The trend from previous years continues—nearly 80% of our surveyed insurance professionals said InsurTech has had a positive impact on their agency, such as increasing efficiency and strengthening relationships
with clients.

These responses also reflect the top answers when Vertafore asked respondents to pick which modernization trends they think are most important for agency growth: improving efficiency and engaging with clients was the most common answer.

Findings from Vertafore’s fifth annual report include:

• One in five insurance professionals reported changing companies in 2021, and financial considerations such as salary and bonuses were key drivers.
• In the face of staffing challenges, nearly 80% of agency owners and principals reported making changes to retain their employees, including increasing compensation, offering flexible schedules and adding remote work options.
• As in previous years, most respondents (78%) would recommend a career in insurance. However, that number dipped by 7% compared to 2020.
• Women made up more than 60% of all respondents but comprised less than 30% of those who identified as an owner or principal.
• While three-quarters of survey-takers felt InsurTech has had a positive impact on their agency in the past two years, more than half also said their agency could do a better job staying up-to-date with tech advances.
• Insurance professionals want more time in their day to work with clients and identified automation and client digital engagement tools as the two most significant modernization trends for agency growth.

Survey responses show that the insurance industry is populated with people who are committed to their clients and community. While insurance was not immune to the Great Resignation, many agencies have been proactive about making changes to keep their talent. And insurance professionals are optimistic about technology advancements, but also feel their agencies have room to improve.

2021 was a complicated year for the insurance industry. Agencies were tasked with finding ways to keep employees safe and to get work done. Remote work became the norm for many and will likely continue to be an important employment factor throughout this year as well.

About Vertafore

As North America’s InsurTech leader for more than 50 years, Vertafore is modernizing and simplifying the insurance life cycle so that our customers can focus on what matters most. Vertafore’s solutions provide end-to-end connectivity across the distribution channel, improve the client and agent experience, unlock the power of data, and streamline essential workflows to drive efficiency, productivity, and profitability for independent agencies, MGAs and carriers. For more information about Vertafore, visit www.vertafore.com.