Underwriters Loyalty To Your Company
I recently read one of those garden variety diatribes bemoaning the fact that employees do not exhibit the same degree of loyalty to their employers as their predecessors did in the “good old days.”
Before delving into what insurers can do to remedy this situation (at least where underwriting professionals are concerned), let us first consider the pathogenesis of the less-than-loyal mentality.
My parents lived through the Great Depression (the one in the 1930’s!).
Parents who survived the Great Depression and later flourished, relatively speaking, within their economic class, sent their offspring a crystal clear message:
“Get a good job, work hard at that firm for 40 years, keep your ‘nose clean’…and the company will take care of you.”
Is it any wonder, then, why baby boomers – as they head off into the sunset – are the standard by which employee loyalty is (still) measured?
My kids’ generation saw people like me work long hours (often for free), bring their work home all the time, travel way too much and generally let their job dictate their lives.
They asked “was it really worth it?”…and soon became the first generation to question the way their folks let their jobs run roughshod over their lives.
They are steadfast in their belief that lifestyle is more important than anything else (and when we use “lifestyle” in this context, we are not referring simply to wealth accumulation).
This is about not letting their jobs cut too deeply into their personal lives, living where they want to live geographically, having maximize flexibility in their work schedules and environments, seeing that their employers genuinely supporting their professional development, and so on.
Clearly – and I think this is becoming widely appreciated now – hiring ideal candidates as new underwriters and keeping them satisfied will present a much greater challenge going forward than it did in with prior generations.
The loyalty insurers covet from their underwriters is a two-way street.
If you want to inspire this loyalty in underwriters, you have to take proactive steps to demonstrate that you hold them in the same regard as you want them to hold your company, your shop and you as chief underwriter.
Obviously, there are many facets to this such as competitive compensation and benefits, appealing working conditions, flexible working hours, freedom to work from home, business-casual dress code in the office…and a genuine sense of job security.
Another major component is a robust commitment to support their professional development.
Many small and medium-size insurers are not positioned to hire new underwriter trainees off the street. They replace retirees and others who leave by recruiting fully trained underwriters. This has been more challenging in recent years, in part because we did not develop and mentor underwriters as effectively in the 90’s as compared to prior decades.
Another issue here is amenability to working from home.
I know companies that have been stymied when trying to recruit experienced underwriters because they have persisted in mandating that all underwriters must work in the home office. This means many potential candidates would have to relocate.
Which, in turn, is a common roadblock, in part because many underwriters are in two-income families. Their spouses/partners do not want to give up the jobs they have and/or, given today’s economic climate, worry about finding equivalent opportunities in a new community.
Most companies that hire new college grads have initial training programs sufficient to assure that these novice underwriters become productive within an acceptable interval.
Unfortunately, the same cannot be said about how many insurers provide for the ongoing professional growth and development (hereafter called PG+D) of experienced underwriters.
When underwriters see opportunities for PG+D lavished upon actuaries, IT personnel and others, they expect similar consideration will be extended to them as well.
There are a number of ways in which insurers can provide for underwriters’ PG+D in the company environment.
Allowing underwriters to do more than “just” underwrite is an obvious example. The importance of this was recognized four decades ago when I started my underwriting career and I sense from discussions at study groups, etc., that even more is being done in this regard nowadays.
Most companies provide monetary support for underwriters who commit to pursuing appropriate credentials. They pay for textbooks and other fees. Many tack on a reward when underwriters earn designations, such as a bonus or a trip to the conference where the designation is formally bestowed. Others are more tight-fisted in this regard (which is hard to fathom considering the modest outlay per person).
The substantial majority of underwriters live within reasonable driving distance of a local or state/provincial underwriting association. Many companies will support their participation in these groups albeit often to an extent that is clearly inadequate (especially when contrasted to the support they give other professionals in the same circumstances).
We have seen too many occasions where companies discourage underwriters to take on leadership roles in local/state associations.
If they expect underwriters to buy into the notion that employers genuinely care about their PG+D, they should be doing just the opposite. Clearly, speaking from substantial personal experience, I know that these association leadership roles are not so demanding as to impact underwriters’ productivity.
Which brings us to the knotty problem of continuing to learn and thereby grow their prowess as technical experts in our unique, multidimensional and poly-disciplinary profession.
In industry surveys, upwards of 90% of chief underwriters say they provide continuing education for underwriters.
Then, when you look past the rhetoric, what you all-too-often find pales by comparison with what should be considered the minimum for underwriter PG+D.
Many companies cobble together a heterogenous mix of widely spaced in-house presentations or case clinics, a few reinsurer webinars, a subscription to On the Risk and call this hodge-podge their “continuing education program.”
Problem is, this simply does not equate to legitimate continuing education akin to what medical directors, actuaries and others have (company-funded) access to.
Underwriters can see that “cobbled programs” are just a “band aid” approach when it comes to employer commitment to them as professionals.
The majority of insurers participating in our CE program enroll year after year.
When we ask what the drivers underlie their willingness to do this year-in and year-out, the most prevalent response is that their underwriters look forward to the courses and would be outspokenly disappointed if they did not continue.
I have seen underwriters’ resumes where they cite participation in our CE program as one of their professional achievements.
I recently spoke with a chief underwriter who had enrolled his underwriters in the past but says he does not intend to do so next year. He said this was because the (staggering) sum of $5000 for 12 courses for his 22 underwriters had now become “beyond budget tolerances.”
This outlay amounts to $416.66 for one underwriter.
If this is – bizarrely – too steep of a commitment to the PG+D of an underwriting professional, what message does it send?
There is no new business department budget that cannot “afford” what its takes to make a serious contribution to underwriters’ PG+D.
Rather, there are chief underwriters who are either ambivalent or refuse to speak up for adequate PG+D resource funding at budget time.
Remember, loyalty is a two-way street.
If you want to inspire it in your underwriters, show them you care about their professional growth and development, with a commitment equivalent to that provided for other professionals in the company.
This is an unabashed win/win.
With a huge ROI.