Students’ Preferences Regarding the Insurance Profession

No. 71 , January 2015 Students? Preferences Regarding the Insurance Profession* By Madhusudan Acharyya+ and Davide Secchi++ Introduction Skills and talent are vital to all businesses irrespective of their size, type or the market economic conditions, which is why the ?talent gap? (the disparity between the supply and demand of talent) may have a detrimental impact on business. Recent observ ations show that the number of business and management students preparing insurance degrees has declined worldwide, as noted in many developed and developing countries where insurance companies are struggling to find skilled talents. At the 2007 Xchanging conference in London, Richard Ward, then Lloyd?s CEO, cautioned with alarming information that the ?100 billion U.K. insurance industry, regarded as the second largest national export, with a 330,000 workforce playing diverse roles plus a further million p eople in related fields, was in imminent danger due to the shortage of highly skilled talents. He commented, ?Yet nearly 90 percent of graduates do not consider a role in insurance , and 75 percent of recruiters in the industry struggle to attract quality t alents? (HM Treasury, 2009). The shortage of talent in insurance is also acknowledged in a U.K. parliamentary study that emphasised ?promoting the insurance industry as an attractive career choice and improving the image of the industry within schools and universities? (HM Treasury, 2009). In 2010, the Chartered Insurance Institute?s (CII) survey of 1,755 school and university students? attitudes towards insurance stated that: ? only 1 per cent was interested to work in the insurance sector (with 15 per cent in finance and 22 per cent in professional services, including law and accounting); ? students regard an insurance career as dull and unethical, involving cheating rather than helping people; ? external sources (the media, teachers, friends and family) who tend to be unaware that insurer?s risk pooling across society actually provides security influenced the students? career choice considerably, so the students in effect know very little about insurance, which leads them to avoid this industry as a career choic e; ? communication about the value of insurance should be improved among the stakeholders to foster awareness. Moreover, CII?s skill survey (2012) reported: ? almost two- thirds of employers are suffering from talent shortages, with claims management and underw riting being urgently needed skills; ? the majority of respondents believe that new entrants joining the industry at both the entry and leadership levels have failed to acquire sufficient skills at school or at the graduate level. * This article is extracted from an original paper published as: Acharyya, M. and Secchi, D. (2015), ?Why Choose an Insurance Career? A Pilot Study of University Students? Preferences Regarding the Insurance Profession?, The Geneva Papers on Risk and Insurance Issues and Practice, 40 (1): 108 ?130. + Glasgow School for Business and Society, Glasgow Caledonian University, 40 Fashion Street, London E1 6PX, U.K. E -ma il: Madhusudan.Acharyya@gcu.ac.uk ++ Executive Business Centre, Bournemouth University, 89 Holdenhurst Road, Bournemouth BH8 8EB, U.K.