Several trends, challenges and opportunities continue to impact retail agencies and brokers. While some have been part of the insurance landscape for years, others may require a closer examination to address.
Are we still in a hard insurance market?
“We expect a lot of pressures driving up premiums to ease in 2024 but not subside.”
– Alan Dobbins, Director of Insurance, Conning
It’s a mixed bag: the current hard market for insurance was caused by global weather, political issues, and high interest rates, and it won’t disappear in 2024. Experts like Dobbins see signs of potential improvement for 2024, but don’t let down your guard. Dobbins added that inflation will continue to make property replacement costs skyrocket. Similarly, on the casualty side, claims costs will also rise as social and legal pressures increase.
Will the insurance talent crisis continue?
39% of workers are afraid of obsolescence in the next 5 years.1
Attracting, hiring, and retaining talent has been a challenge for the insurance industry for decades. Many still view it as a “stodgy” industry with limited opportunities, and retail agencies are working to reframe this.
However, this isn’t the only problem. A survey of over 30,000 workers worldwide found that 39% fear their jobs will become obsolete in the next five years.
To attract and retain talent in the insurance industry while revitalizing its image, retailers have a lot on their plates:
Organizations must communicate the diverse and challenging roles available and establish strong career paths to combat fear of obsolescence. Other strategies to stand out include enhancing talent through upskilling and allowing for flexible work.
Retail agencies that build and develop strong teams will be more effective at attracting and retaining talent. Stronger teams comprised of individuals with deep insurance expertise will be a competitive advantage.
Will insurance agents be replaced by technology?
Insurance is bought, not sold.2
InsurTech has long been seen as a threat to insurance brokers, but it hasn’t yet disrupted their client relationships in a significant way. While it has reduced some friction in the small account space with faster turnaround on submissions, it has not become the disruptor brokers feared just a few years ago.
Your clients are still looking for high impact advice on risks – and their preferred partner is a human being, not technology. Market conditions, increasing complexity of risk, and the need for guidance in navigating the insurance marketplace will strengthen buyer/seller relationships. Brokers with deep insurance expertise, who specialize within lines of insurance or industries will have an advantage over generalists, especially in the middle-market and large account space.
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