Who’s getting squeezed in the brokers’ war for talent

A war for talent in Canada’s P&C insurance industry may be inadvertently causing collateral damage in smaller and mid-sized brokers, Traci Boland, Insurance Broker Association of Canada president, tells Canadian Underwriter.

That said, their smaller size may allow them to pivot more easily when it comes to offering hybrid workplaces.

In CU’s 2024 National Broker Survey, 69% out of 211 brokers identified attracting and retaining talent is the Number 1 challenge for the brokerage channel right now.

It’s not just a Canadian issue, as Boland points out, saying the topic came up at the World Federation of Insurance Intermediaries she attended in Mexico City recently. But as the Canadian P&C industry ramps up its efforts to recruit more people into the business, brokers are finding that keeping them may well be the bigger issue.

“Finding qualified staff with experiences is getting very difficult,” Boland reports. “Right now, brokers are able to hire green. A lot of college programs out there are running insurance programs. And brokers can train and try to retain the person in whom they’ve committed [an investment]. But retaining them is now actually getting just as hard as finding them. There’s a lot of movement within the broker channel. It’s an issue.”

Several factors are working against smaller brokerages located in more remote regions of Canada, Boland says.

In some areas, the pool of potential candidates could be narrower simply because of the population numbers. And some companies in larger, urban areas may be able to draw on talent from more remote areas because of the hybrid office arrangements, which allow employees to work remotely from their homes.

“Now that you’ve opened [the workplace] up to remote working, you have smaller brokerages and medium-sized brokerages, maybe not [located] in the big cities, that are really, really struggling.”

Also, depending on the area, some more urban brokerages may be able to offer larger salaries to prospective brokers, since salary and compensation packages vary by region.

The draw of higher salaries is creating a lot of inter-industry competition or “churn,” a recent Insurance Institute of Canada demographics study shows.

The Insurance Institute of Canada in 2023 conducted an HR survey with 26 Canadian P&C organizations, representing more than 44,000 employees and 34% of the industry’s workforce.

Ninety-two per cent of surveyed companies said P&C organizations are competing with each other for available candidates. Almost two-thirds said their next closest competitors for talent are from other insurance fields.

HR recruiters acting in the P&C insurance field have told CU that organizations are looking very actively and specifically at targeting talent in other organizations.

“I think [poaching happens because] we have a number of people that have been in the industry for five to seven years,” Brad Neal, the Insurance Institute of Canada’s vice president of business development and strategic partnerships, said during a Live with CU last September. “They’ve got the expertise, they’ve got the talent, and people want them — especially when there’s not enough of them.”

Another issue for brokerages is that people get poached after brokerages invest time, money, and resources to train people for the better part of a year – or longer, for commercial broker prospects — only to see the person leave to pursue a more lucrative opportunity elsewhere.

“Competition has increased so significantly,” Boland says. “It’s getting harder for small and medium-sized brokerages to find and keep staff, and to be able to compete, because they don’t have the resources in the same way that other brokerages [can offer] training [and] compensation packages.”

The one thing smaller brokerages may have in their favour, Boland adds, is that it’s easier for them to offer flexible workplace arrangements to their employees than is the case with their larger counterparts.

“I think smaller brokers…can think outside the box on some things like hybrid, working hours, flexibility, culture, and community,” Boland says. “Those are all things that are a little more more difficult — not that they can’t be done, and they are done — in the bigger organizations. But in a smaller organization, it might be a little easier to pivot and be able to adapt quicker to some of the [recruits’] needs and adapt to what a potential employee requires.”

 

Feature image courtesy of iStock.com/Anton Vierietin