How the gig economy can shore up the insurance talent crisis

Contract and freelance employment continue to grow and have already become the norm for many professionals. In fact, a majority of the workforce will be engaged in some sort of contract employment by 2028, according to an Edelman Intelligence study.

Insurance is no exception. The Jacobson Group and Ward Group’s 2018 Semi-Annual U.S. Insurance Labor Outlook Study found that 13% of insurers expect to increase their use of temporary staffing solutions in the next 12 months.

Without a question, the gig economy is here to stay.

Why consider temporary staff

Thanks to the industry’s dwindling talent pool and prevailing candidate-driven marketplace, most insurers have continued to rely on a “doing more with less” strategy since the recent recession. But sudden influxes of work, systems transformations, catastrophes, retirements and unexpected turnover often leave insurers shorthanded. Embracing gig workers at all levels enterprise-wide is a cost-effective and proven solution to mitigating workload fluctuations and completing special projects.

Bringing in new, full-time professionals is undoubtedly a costly and time-consuming process. Recruitment, benefits, on-boarding and training fees quickly add up. Not to mention expenses related to employee turnover, including severance pay, unemployment benefits and more. As a result, companies are often reluctant to incur the large risk of a full-time hire just for seasonal fluctuations or specialized project support.

However, the burden is even greater when organizations consider the cost of vacancy. Stressful, demanding workloads have a significant impact on the job satisfaction of the permanent workforce. In today’s tight labor market, employee engagement must not be overlooked. Employee morale can quickly suffer when work/life balance is continually threatened. Decreased productivity will ultimately ensue, further compounding workload issues and eventually impacting business outcomes.

Benefits abound

Interim staff are capable of providing much-welcomed relief. Skilled contractors can make an immediate, cost-effective and positive impact on enterprise initiatives. In addition to helping manage workloads brought on by seasonal fluctuations or attrition, temporary staff can also be the answer to addressing short and long-term projects that permanent staff do not have the time or perhaps the expertise to handle. For years, start-up organizations have been using temporary talent in order to stay nimble and pivot quickly.

Some insurers are still surprised to learn they can find consultant-level expertise on a temporary basis. These contractors are typically highly skilled and experienced professionals who have chosen a career as temporary staff. They are drawn to the flexible lifestyle and diversity of projects unique to contract work. Leveraging years of hands-on knowledge, these subject matter experts are adept at jumping in and hitting the ground running in a comparatively short time period. They exhibit extreme flexibility, being able to quickly integrate into any work environment with limited assistance or training.

Forward-thinking carriers rely on these contingent workers for a variety of special projects from repricing a book of business and supporting rate reviews to writing policies, leading reunderwriting projects and creating new underwriting manuals. Contractors are also called upon to conduct competitive analyses and help organizations grow into new lines of business or geographical regions. Others leverage specialized gig workers to meet filing deadlines or support compliance initiatives by adjusting systems as mandated by regulatory changes. Interim employees provide breathing room for companies already strapped for bandwidth by day-to-day operations and long-term projects. Contract professionals allow organizations to address critical projects without overloading existing staff members or endangering the progress of other initiatives.

Bringing in contractors is also a smart solution for insurers looking to improve the profitability of struggling business lines. These experts are capable of providing honest assessments and consultative insights as outsiders with no underlying biases. An experienced consultant with specialized expertise in assessing and analyzing turnaround situations can help an organization find both short-term and long-term solutions to turn the tide and provide profitable services to its customers.

Refreshed and focused

Contrary to popular belief, many of today’s gig workers did not “settle” for temporary work. Some left behind permanent positions and steady paychecks in pursuit of increased flexibility, specialized focus and work diversity.

In insurance, low unemployment rates coupled with mass retirements and a growing skills gap create an environment filled with countless complex projects. Many qualified, experienced insurance professionals are taking advantage of this situation and pursuing contract opportunities that ultimately allow for benefits unmatched by traditional permanent employment opportunities.

Project-focused work also appeals to individuals who enjoy zeroing-in on niche scenarios that maximize their distinct expertise and skills.

Additionally, the contractor lifestyle is popular among retirees who are ready for their much-deserved freedom, but want the ability to leverage their veteran expertise on their own terms on an as-needed basis. In fact, one proven way to augment current permanent staff is to build a bench of company retirees who would be willing to return on a project basis.

However, the key to taking full advantage of the benefits the gig economy offers is to partner with a talent provider who can deliver a broad spectrum of contractors from entry level all the way to executives and subject matter experts. A boutique firm that specializes in the insurance industry is a great option. Niche talent providers offer a deep bench of experienced insurance professionals ready to jump in and make an immediate impact on insurers’ unique, and sometimes urgent, project needs. In fact, they often have access to retired C-level experts across all disciplines who enjoy temporary assignments to stay sharp and to continue contributing to the industry. These talent providers and their proven track record of excellence allow more and more property and casualty insurers to embrace the gig economy.

As the candidate’s market prevails and the industry’s talent pool continues to tighten, the gig economy is coming to the forefront as an answer to the talent crisis. Whether the short or long-term need results from an unforeseen workload situation, seasonal fluctuations or special project work, temporary professionals are often a more effective and efficient alternative to traditional hires. No longer just for clerical positions, contract workers are able to quickly assimilate into various work environments and leverage their specialized expertise to make an immediate impact on various functions and initiatives across the property and casualty space.

Tony Cañas is a property and casualty client advisor with The Jacobson Group. He also is the co-founder and chief motivational officer at Insurance Nerds and co-author of the book “Insuring Tomorrow.” He can be reached at +1 (800) 466-1578 or tcanas@jacobsononline.com.

These opinions are the author’s own.

See also: How to recruit millennials to the P&C insurance industry