By Neil Sheppard · January 14, 2022
7 minute read

Calling all nerds: solving a shortage of insurtech talent

calling all nerds

There’s a shortage of vital tech talent and young workers in the insurance industry. How can you attract GenZ tech talent to drive your digital transformation? 

Key takeaways: 

  • The insurance industry is struggling to attract the tech talent it needs to drive digital iteration on legacy systems 
  • Gen-Z tech talent are looking for firms with a modern, remote culture and up-to-date tech tools to work with 
  • Using hybrid Brownfield solutions to get modern tech working with your legacy systems can draw the talent you need 

There’s a digital revolution going on in the insurance industry. From mobile apps to robo-advisors, it’s clear that insurance companies need to boost their investment in tech to compete. That, however, requires finding the right tech talent to build, drive and iterate advise, support and instigate your insurance innovation. 

There’s a tremendous benefit to having an experienced, seasoned team. However, digital skills and fresh outlooks on the insurance industry will mainly come from young, talented individuals who’ve been trained and educated in the digital age. Those ‘tech nerds’ are vital to your organization’s future. 

That talent, unfortunately, seems to be in short supply. A McKinsey Global Institute report said that demand for workers with technology skills would rise by 55% between 2016 and 2030, and that’s not taking the pandemic into account. Yet, not only are specialists in tech fields in high demand, they’re also unlikely to want to work in the insurance industry.  

According to an Applied Systems report, only 14% of Gen-Z respondents were interested in a career in insurance. As such, the Everest Group claim 25% of the required tech roles in insurance are currently vacant. 

If you aren’t able to attract digital experts to your firm, your technology will fall behind that of challenger insurers that are better able to attract tech talent. In that case, you risk missing out on the digital revolution entirely. 

The need for digital transformation 

Digital transformation was once the buzzword being thrown around as the future of the sector, but it’s rapidly becoming the baseline minimum for the insurance industry. Temporary consultants and new software aren’t enough to keep your firm competitive.  

With the pace of technology and new regulation accelerating, it’s no longer about a one-and-done digital project, it’s now about constant tech iteration and innovation to meet the changing needs of the consumer and market. This is why digital insurers performed better when hit with the events of the last two years, from political turmoil to the pandemic. 

According to a PWC survey, 41% of customers would switch provider due to a lack of digital capability, and that’s just the beginning. By 2025, artificial intelligence (AI) will power 95% of customer interactions, according to Servion, while Insider Intelligence predicts that robo-advisors will be managing USD 4.6 trillion by 2022, says Business Insider. It’s no wonder a McKinsey study also showed a relation between digital and analytics talent and company profitability. 

Yet, it’s not just profits that are driving the move to digital insurance. Regulators like the UK Financial Conduct Authority (FCA) are calling for robo-advisory to become the industry’s strategy to deal with missold products and a lack of customer knowledge. Incumbents not offering an excellent digital customer experience could find themselves on the wrong side of the regulator. 

The question is, how do you attract the talent that can drive constant digital iteration within your firm? 

Insurance tech talent want remote work and diversity 

Let’s say you’re a fresh graduate with a UX design qualification. You’re looking for your first role – one that allows you to fully employ the skills you’ve learned.  

You run a job search and find a new digital insurer searching for a “customer experience design engineer”, offering flexible, remote working, new tools and new software. On the other hand, you find the same role at an incumbent insurer that’s advertised as “mainframe engineer”, requires you to wear a tie to the office every day, and needs you to work with software based in MS DOS. 

Which would you apply for? 

Statista found that 60.2% of young insurance agents believe insurtech has a positive effect on the industry. So, clearly, a firm with a forward-thinking culture with the latest software tools and platforms will find it easier to attract young talent, but that’s easier said than done for incumbent insurers. Digital companies have only existed since the internet became prevalent, but incumbents will have legacy systems storing unformatted data that may go back before the internet existed.  

Dealing with legacy systems won’t be appealing to fresh talent, particularly when updating those systems may not be feasible in the short term. So, what’s the solution to drawing in talent and keeping it? 

Giving insurtech talent the workplace culture they want 

According to Buffer, 98% of people would prefer to work remotely, at least part-time, while 54% of office workers would leave their job if they could have one with more flexibility, Gallup found. So, the first step to attracting young talent is to offer flexible working.  

This is also a way to expand your talent pool. If your workforce goes remote, then you can recruit key talent from anywhere you can courier a laptop to. You’re no longer restricted by having to find talented staff within commuting range of your office. 

Remote working is nothing, however, without a remote culture. If your team meet only in person or agree strategy at a café on their lunch break, then it’s unlikely that your new hire on a different continent will feel empowered or involved. An agile, online culture, however, can break down barriers in diversity and inclusion that have been holding back talented workers. A worker with a speech impediment or a strong accent can contribute to a text conversation far more easily than an in-person meeting. 

This is far more important than you may think. A Ryan Jenkins survey highlighted that 77% of Gen-Z workers said that a company’s diversity and inclusion policies affect their decision to work there. Your culture has a major impact on your ability to attract up-and-coming talent. 

The catch-22 of recruiting insurance tech talent 

To attract new talent, you need a modern workplace with up-to-date tech. On the other hand, you need young people with fresh ideas and tech skills to create a modern culture and install and maintain new technology platforms. So, what’s the answer? 

Hybrid So-called Brownfield solutions combine the latest software platforms with legacy systems to form a hybrid model. Data can remain in legacy systems, while a modern digital experience can be designed and rolled out to customers at the front-end.  

This allows talented designers to work on creating exciting customer experiences using the latest tools without you having to invest in starting your software ecosystem over from scratch. If your strategic vision is ambitious enough, you might be able to win over tech talent to help you build it from firms that are already starting out with an established status quo and fully realized systems.   

While working with legacy data in outdated systems may not be appealing to key talent, the challenge of gradually migrating legacy data into a “data warehouse” to be processed by sophisticated robotic process automation (RPA) and AI tools could be satisfying work for ambitious data scientists. 

Once these talented, young hires are embedded in your organization, and given the flexibility to work in the way they want, your culture will naturally develop into the kind that attracts more of these talented young people.  

How fintech can help 

That’s why we’ve worked to make all our software platforms flexible, and able to embed alongside your existing software ecosystem. FintechOS platforms can be used to create all the tools and products you need with minimal coding knowledge, offering an exciting starting point for your new hires, and giving them the tools they need to build an amazing customer experience on top of your legacy systems. 

This will give your tech ecosystem the boost it needs to attract the top talent that can drive your firm through the digital insurance revolution. To find out more, visit the FintechOS site to book a demo. 

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