Hard market challenges aside, brokers not racing for the exits

Canada’s hard market in insurance remains the Number 1 concern of new and experienced brokers alike, as well as brokerages big and small, according to Canadian Underwriter‘s 2022 National Broker Survey.

The gender split among respondents was most prominent, with 86% of women picking the hard market as their top concern on a list of 12 options. For men, 67% identified the hard market as their top concern. Canadian Underwriter’s February survey asked more than 250 brokers nationwide what they saw as the strongest challenges to the broker distribution channel.

“There’s no doubt that for many brokers, this was in fact the first time they’ve ever experienced a hard market,” said Joseph Carnevale, president of the Insurance Brokers Association of Ontario. “It’s been over 17 years since the last hard market in our industry, and it’s something new to a lot of people.

“In general, some of the things making this difficult and somewhat stressful to brokers include not having control over the pricing of a product, or the availability of a product, or the timeliness of getting the quote on that product.”

Despite those issues, employee retention at brokerages doesn’t appear to be a problem. While brokers expressed frustration with high workloads stemming from the hard market and pandemic, they still don’t seem to be racing for the exits.

Overall, 77% of more than 250 respondents rate their profession between 8 and 10 on a job-satisfaction scale (10 being the highest). So, ‘The Great Re-Shuffle’ notwithstanding, those brokers already in the profession generally seem content to stay.

“Although it can be frustrating with the ever-changing insurance world, it also keeps you on your toes,” said one broker who indicated they’re “very unlikely” to leave the profession in three years. “No two days are the same, and I’m always having to learn new coverages, etc.”

Seventy-four per cent of the more than 75 broker principals/owners who participated in the survey believed their employees were generally happy at their brokerages. That’s down 6% from the prior two COVID-19 years.

Plus, if you look at the broker producers’ answers, they seem more loyal than their employers think – 77% of producers report the highest satisfaction scores with their current employers.

Granted, their loyalty’s diminished somewhat as the hard market drags on (scores were 83% in 2020 and 79% in 2021), but still the number’s been consistently over 77% over the past three years.

When asked if they plan to leave the profession voluntarily for any reason over the next three years, only 24% of brokers said it’s highly likely. That’s entirely consistent with responses throughout the pandemic (23% in 2021 and 24% in 2020).

Respondents, though, showed they are ready for the next phase. A woman with 16-30 years in the business who works at a large brokerage said: “As a broker, the hard market as of late, as well as the pandemic, have been hard to deal with. I am hoping we are going to come out of these soon.”

 

This article is excerpted from one that appeared in the May issue of Canadian Underwriter. Feature image courtesy of iStock.com/alexir