Challenges with talent are affecting almost every industry worldwide, with insurance businesses no exception. Arguably less attractive to potential applicants than the more high-profile areas of financial services, the sector must adapt its recruitment processes to secure skilled workers.
However, there is not just a talent gap – there is also a growing deficit in experience as industry veterans retire.
“Unlike many other industries, the insurance workforce is an aging one,” notes Gaye Bingul, industry advisor expert for SAP’s Insurance Business Unit. “Key businesspeople with critical knowledge are retiring, and there’s a risk associated with losing them.”
Change is needed to replenish this workforce and ensure that the insurance sector is equipped to handle the digital transformation demanded by the increased use of artificial intelligence (AI) and machine learning (ML). New digital platforms provide convenient solutions for HR teams to manage recruitment more effectively, and for existing insurance employees to upskill successfully – all while reducing overall costs.
Insurers must attract more tech talent to evolve
SAP’s Insurance Innovation Survey 2023 interviewed a range of experts and executives to find the main pain points of the industry. Attracting talent was ranked as the top priority for insurers over the next three years. As well as sourcing replacements for aging staff, insurance companies need to find tech-savvy candidates who can understand and harness the strengths of AI and big data.
“It doesn’t come as a surprise that talent management is the number one priority for insurers right now,” says Bingul. “To execute a digital agenda, they must have the right team in place with the right knowledge. Because these are the skills that are going to carry the organization forward. And because every insurer is being automated, they need to do this or fall behind.”
However, when attracting talent, insurers are competing not only with other insurance businesses but also all other tech industries. Everyone wants to capitalize on tech and automation for their own benefit, making roles in these areas in high demand. Unfortunately, skilled tech employees remain in short supply, and insurance companies are often outbid in their talent search by big-spending companies in fintech, banking, and analytics firms.
“Let’s admit it – insurance has not traditionally been among the top industries that tech talent considers working for,” adds Bingul. “To attract millennials and Gen Z workers, insurers need to think a lot more strategically about HR.”
The opportunity for digital innovation in HR
Usually regarded as a back-office function, a digital-first HR strategy can contribute significantly to recruitment success for a business.
“Business strategy must align with talent strategy,” says Bingul. “Therefore, if business strategy concerns digitization, automation, and efficiency gains, talent strategy needs to go hand-in-hand with that.”
With the scarcity of digital talent, traditional recruitment processes are proving inflexible and outdated. New skills-based approaches to hiring and overall operations are increasing agility by allowing talent to move in and around the business based on where the skills they possess are required.
Unexpected events such as natural disasters frequently require insurers to change their priorities quickly. In such a scenario, sales and marketing will take a backseat to claims and customer service departments. Therefore, the more skills an employee has, the greater the value they will offer a business.
“With a skills-based approach, the insurance company can have a real-time holistic view on the skills and competencies that reside in their organization,” notes Bingul. “The insurer can then channel resources with the right skill sets to those functions and respond to the disruption almost in real-time.
“This is a game-changing, time-saving approach compared to the traditional process of opening a job posting, scrambling to find the right person externally, and onboarding new hires.”
If external hiring is required, AI can help make recruitment processes cheaper and more efficient. Applicant screening, drafting interview questions, and compensation discussions are all time-consuming processes whose costliness could be slashed with the assistance of AI tools. Automation can filter potential candidates far more quickly, while suggesting challenging questions that will help recruiters test applicants in a constructive way.
How an insurance business can optimize resources
Providing insurers with a range of functions, including skills-based employee analysis, SAP’s market-leading SuccessFactors Solutions is the number-one HR software currently available. The company’s intuitive software also enables employees to look at their skill proficiencies and consider AI-enhanced recommendations for further training, including a growth portfolio that is mapped to cover formal and informal learning opportunities within and outside the company. This ‘whole self-model’ on the SAP talent intelligence hub empowers existing workers while helping businesses retain staff through employee engagement.
“We want to make sure every employee feels valued and unique,” says Bingul. “Our AI-powered skills framework makes it easy for employees to build their individual skills portfolio and gives organizations a holistic picture of their workforce.”
By having HR solutions on a cloud platform such as SAP SuccessFactors, insurers can ensure they keep up to date with HR regulations as the solution can be localized to suit many countries worldwide. Additionally, cybersecurity and tech updates are all managed by SAP and supplied to users automatically, enabling insurers to focus on their core business.
“We’re not embedding AI in a vacuum,” adds Bingul. “We are delivering new innovations, including 30 new AI use cases, to provide organizations with greater efficiencies. SAP has one of the most robust AI-powered roadmaps on the market, which is why hundreds of insurance companies today execute their HR strategy with SAP SuccessFactors.”
To learn more about how SAP can support insurance companies, download the report below.
