According to the Chief Economist at Desjardins Insurance Group, there is a growing exodus of Canadian highly skilled workers that is leaving businesses scrambling for replacements, as there are not enough trained younger workers to take over. The Great Retirement is gaining speed with experienced workers leaving to retire early, resulting in a significant loss of human capital and knowledge.
The pandemic has worsened this trend with workers deciding to retire earlier to make up for lost time during Covid by choosing to travel and spend more time with family. Currently 20% of the Canadian work force is over the age of 55 and that percentage will increase in coming years due to limited birth rates and low immigration levels.
Many of the G7 countries are experiencing the same but to a greater degree than Canada. As a result, most countries are looking to retain their older experienced workers longer but with non-traditional approaches such as hiring part time experienced workers to assist in bringing along the younger workers. Canadian Insurance Mutual Professionals works with known experienced insurance talent that work on a project or part-time basis, to fill the gaps needed for experienced personnel.
In an effort to increase the amount of talent available, CIMP has recently begun a working relationship with WAHVE Canada (Work at Home Vintage Experts) to access additional experienced insurance talent for projects or short-term replacements. WAHVE’s value proposition is the ability to source seasoned candidates (over 55 years old) that are screened for digital skills and insurance experience. Check out WAHVE Canada at https://wahve.com.
Canadian businesses have identified five major risks to their operation – and these reflect how their risk assessments have changed due to the COVID-19 pandemic.
Aviva Canada surveyed 1,500 Canadian businesses of all types and sizes surveyed for the report. This is the first Canadian report of its kind to help businesses make sense of their specific risks, better manage those risks, and prepare for the future.
According to respondents, their top five business risks are:
1. Public health events
2. Cyber security and cyber incidents
3. The health and mental wellbeing of employees
4. Shortage of skilled workforce
5. Business interruption, including disruptions in supply chain
Other key findings of the report include:
· While 45% of respondents had indicated that the COVID-19 pandemic will have a negative long-term impact on their businesses, 47% said the impact is instead positive - it was noted that one of the undeniable trends in the wake of the pandemic was the acceleration of technological adoption.
· Realty (40%), business and professional services (36%), manufacturing (31%), and retail (31%) were the leading industries in terms of cyber security risk rating.
· Incidentally, realty (60%), business and professional services (51%), retail (49%), and manufacturing (45%) had the highest concern for employee and customer health/wellbeing over the pandemic.
· Both the hospitality and construction sectors are at considerable risk of skilled labour shortages; 31% of hospitality businesses had indicated in the survey that labour shortages were a "serious" risk.
· 27% of businesses see business interruption, such as supply chain disruption, as a major threat going forward.
Since the start of the pandemic, businesses have needed to reassess their business risks and revise their business planning to better manage the changing risks to their operation in order to become resilient to economic changes.
A key takeaway is the rise in the concern over an adequate and healthy workforce. With Covid, there has been significant reductions in availability of skilled workers in various business sectors. Without proper levels of trained workers, the risk to business operations has increased significantly.
With all the broker acquisition and consolidations happening in the last several years, are there still significant organic growth opportunities within insurance brokerages, agency departments or insurance brokerage groups? Can brokerages and agency departments obtain significant annual growth without mergers, acquisition or amalgamation? There is one brokerage example that is finding the right formula that provides consistent revenue growth organically.
Stephen Billyard, CEO of Billyard Insurance Group (BIG) was awarded CEO of the Year by the Insurance Business Canada Awards in 2021. He was interviewed by Insurance Business Canada and below are points discussed in that interview.
In order to be successful in the organic space, Stephen suggests that you need to be good at a lot of things starting with business development, learning how to access your communities and form relationships with business leaders cultivating personal networks. However, brokers need a strong brand that is going to stand behind them so that they can they can be well represented in the marketplace.
Furthermore, empowering technology to make it easier for your clients to do business with you and for brokers to do business more efficiently so they can better serve their customers. Hiring and onboarding staff to grow organically is a significant challenge in business today. BIG Group has brought on over 700 agents in the last number of years into many different communities.
The mechanics of not only of finding and cultivating those insurance brokers but getting them into an office location, computer and trained to sell, is considerable work. In addition, there is the building of infrastructure to support these outcomes. Training new brokers to understand how to do their job, how to work within the BIG system, how to sell insurance, how to build those networks, how to cultivate those training courses. Additionally, to support growth, there is a need for advertising both digital and traditional, to generate leads. Finally, the work to create a distinct brand that stands behind each broker.
Attracting top talent is one of the critical elements of BIG Group growth. BIG has put some really hard work into creating their core values to make sure that they were creating a culture where people want to be working, as they spend more time in the workplace with colleagues than at home with family.
Coaching and mentoring in the insurance industry is incredibly important because the jobs that brokers do are so difficult. We need understand our client, the risk that we're underwriting and customer needs. We then need to understand the appetites and underwriting nuances of many different insurance carriers including the different technology of all those carriers.
The BIG Group did considerable work to convince the insurance industry that wasn't very accustomed to significant organic growth, about how BIG Group did business as an organic growth model. BIG Group has established itself as a national player that is continuing expansion with the support of their insurance markets and customers.
There are many opportunities to enhance organic growth within insurance brokerages or agent supported mutuals. Vision and expertise seem to be the keys to success.
Western Financial Group has undergone significant expansion across Canada over the past few years to become one of the largest and fastest growing independent property and casualty brokers. Some of its most recent Ontario acquisitions being Wiesner Insurance Inc. based in Brampton and Stewart Morrison Insurance, a second-generation brokerage with offices in Lindsay, Fenelon Falls, Bobcaygeon, Port Perry and Peterborough. Westland has also acquired Transure Insurance Inc. a transportation insurance-focused brokerage, based in Waterdown, Ontario.
Kenny Nicholls, president and CEO at Western Financial Group, takes a thoughtful approach to all the merger and acquisition (M&A) activity he engages in, explaining that he wants to carry out the legacy of the broker groups that are acquired. “As we continue our journey of national expansion, we’re honoured to be able to serve five additional communities in Ontario. Our whole M&A strategy revolves around how Western can continue growing by furthering the legacies of the broker groups that have joined us over the last 20 years,” he explained. “There was a time when volume was the key, but once that was reached, we focused on helping broker owners’ growth.”
The industry is changing at a rapid pace, and Western aims to provide its partners with caring, comprehensive support. As market conditions become more favourable, having financial, product, talent, and technological support are all top of mind for the organization. “The hard market made it very difficult for smaller players to ensure capacity, but we can continue providing rural markets with the products they need based on our size,” said Nicholls. “There are also labor shortages across Canada, and we help work through how broker owners can best service their communities and customers.”
Western has ambitions to continue growing organically while also connecting with broker groups in areas that haven’t been reached yet. Every acquisition is completely different based on the broker group, and Nicholls does not believe that one size fits all. Elevating a new partner within the Western family takes a unique approach, and Nicholls said this is what sets Western’s M&A strategy apart in the Canadian insurance industry. “The way we provide support is multifaceted,” he emphasized. “We have the ability to not only bring our market contacts, but we also provide better terms from a commission perspective while having the internal capacity to build more specialized products.
“We have our own underwriting teams, claims adjustors, and premium dollars through international and domestic markets. Therefore, customers get superior service for specialized needs.” Western also works with a group’s internal leadership to see who can be a fit to a particular team. If there’s no immediate leadership, they help find the right people for the role.
At the end of the day, after a transaction is made, Western’s approach to each broker group is different. The firm provides tailored M&A support for their unique needs. “This is a people business, and we want to take that approach for everything we do,” he said. “Rather than thinking of M&A as a transaction and buying a book of customers, we rather view it as a succession plan for broker owners who’ve built successful businesses and reputations.”
In winter conditions, fire risks are more prevalent in barns due to the higher occupancy load of livestock and the increased electrical loads due to heating/lighting that may result in overheated circuits and motors. This may result in damage to the electrical equipment and machinery as well as ensuing fire damage to part or all of the building. Adding to that is the decreased access to barns for fire department vehicles. All of this can add up to serious fire losses to buildings, equipment and livestock.
Risk assessment is important for both farmers and insurers. Each of them will have to accept some part of the risk. Can fire risks be accepted by the farmer in the hopes no loss will occur? Will the farmer purchase proper insurance and pass the risk to his insurer? Can the insurer transfer the risk to the reinsurer thereby avoiding the loss themselves?
Perhaps the better way is to reduce the risk before any acceptance or transfer is taken. Then financial damage will be significantly reduced and thereby be more acceptable and cost less. Loss prevention is about reviews and actions that can reduce fire risk and new technology is providing greater ability in loss control.
Prevtech is fast becoming the leader in electrical monitoring for farm buildings and several larger insurers are adding them to their risk tool box. Their inexpensive monitors that watch the electrical grid for any variations in loads and usage, can provide early warning of system failures. Here the saying “An ounce of prevention is worth a pound of cure” is so true.
Following that theme, Canadian Insurance Mutual Professions (cimp.ca) and Prevtech Innovations have arranged for a free webinar for the Ontario Mutual community on February 17th at 11am – 12pm. This webinar should be of interest to mutual staff and brokers who work with the farming community. Topics to be discussed are:
Interested in joining the webinar? Email the list of attendees to firstname.lastname@example.org
With winter now in full swing, snow removal is riskier than ever. Insurance costs continue to increase due to an increase in frequency and severity of slip-and-fall lawsuits, where insurers are on the hook to fund the defence against more frequent lawsuits.
Personal injury lawsuits have increased dramatically in recent years, especially in Ontario, where personal injury law firms have been working on a contingency basis, which means that lawyers agree to only receive payment if they win a settlement.
This has resulted in more injured parties taking their chances with personal injury claims, such as pursuing compensation after a slip or fall at an icy or snowy location and it has given personal injury lawyers more incentive to be aggressive and potentially seek higher damages. Ontario has tried to remediate the issue by introducing new rules for personal injury lawyer contingency fee arrangements in July 2021. The province also passed new legislation in January, Bill 118, which cuts the amount of time that people have to file a personal injury claim from two-years to 60 days.
However, even if Bill 118 is successful in stemming the tsunami of personal injury claims being filed in the highly populated province, it will take some time for insurers to realize an impact and potentially readjust liability premiums accordingly. Soaring insurance rates have not been isolated to liability insurance alone. Commercial insurance rates have been under “tremendous pressure” since 2019 and certain lines of business insurance remain very challenging to obtain coverage at reasonable prices.
For some of the high-risk sectors such as host liquor, landscaping, snow removal contractors, and roofing contractors, premium increases and lack of appetite among insurance carriers are creating difficulties for insurers accepting these risks. Much of this high-risk business, including liability coverage for snow removal contractors, is typically placed individually by managing general agents (MGAs) or through large programs. Some smaller high risks accounts are placed by brokers with smaller insurers that are not fully aware of the risks being accepted due to lack of risk assessment knowledge with brokers and underwriters.
With the increased frequency and severity of losses, most insurers are finding it more difficult to renew polices because there’s been a huge focus by domestic and international insurers on profitability and the disposal of loss-making lines. Loss-making accounts have been severely punished as most underwriters are super selective and capacity is tight.
Is 2022 just a repeat of 2021 and even 2020? Are we stuck in a loop like the movie “Groundhog Day”? Hopefully the year will eventually move forward as the pandemic gets under control as Omicron burns itself out and nothing replaces it. With the fast-spreading Omicron strain, we are now again forced back into lockdowns and stay home orders, like we saw a year ago. So the short-lived attempts to return to the office and engage with in-person meetings, has reversed itself. Were we really ready to go back to the way it was?
After two years of working from home and more time expected this year, did the workforce and productively suffer? Work studies have shown that productively has actually improved during the pandemic, so will this model be finally accepted? Most businesses have pivoted to working from home and managing via conference calls with Zoom or Teams. Employees have become proficient with digital communication and customers have also increased their confidence in their use. The largest credit card company Visa has seen usage increase, not only from on-line shopping but also the serious decline in use of cash for purchases – enough to change how credit cards are being modified for a more cashless society.
The insurance community has lagged behind in its adoption of digital technology but insurance customers are demanding more ways to obtain and pay for insurance. This has given rise to more use of digital technology by some insurance companies and brokers. Customers no longer need to come in to see their broker or agent and are comfortable dealing electronically. Does this reduce the need to have insurance offices fully open to the reduced number of customers? In-office traffic has certainly reduced during the pandemic and is likely not ever going to return to pre-covid levels. Do insurers need to have staff work from home or is a hybrid model of office/home the best practice?
Most businesses are involved with risk/benefits propositions. How much risk to take on and what would be the benefit. The last few years has tested their ability to accept risk. Insurers are risk assessment focused and should be able to keenly determine the risks they face in the continuing pandemic. The start of a new year is a good time to review the risk of operating a business and what can be done to reduce or transfer the risk. Businesses rely on their insurance broker or agent to assist them in this risk assessment but who do insurers and their sales force rely on?
Traditional workflow processes used by insurers are designed to streamline tasks that are slow and tedious. Insurers have moved from paper based files to using electronic data. But just because there are established workflows and automated systems for data management and communication, does not mean that you have an optimized process management system in place.
Insurers have digitized their information but their systems are not working together. Many insurers have made no efforts to integrate this information at a storage level or business process level. Systems are segmented creating roadblocks to a coordinated information program.
Intelligent process management is a system of analyzing the processes in place and developing solutions to optimize them further. Automation and intuitive process management tools can maximize time and productivity within the office and between users outside the office including brokers and customers.
Strategically planned process management reinforces efficiency and ensures that forms are always processed and managed within the system. Technology has led to a change in how underwriting is done allowing more involvement in account management and customer service. Data from third party sources with additional data can be provided to assist underwriters in risk assessment and rating.
Insurers moving into more digitization and intelligent process management need to be aware of large scale changes to computer systems. It is time consuming to assess and put into place new systems that require lots of consultation with insurance automation professionals. Delays and system implementation failures can be costly in loss of productivity and service ability.
To avoid these potential problems, it is better to prioritize improvements and roll them out in phases. This allows for cost effective implementation and allows current systems to operate while portions are being upgraded and tested to ensure they work together.
According to the Harvard Business Review, insurers that implement well designed digitization programs can deliver up to 65% in cost reduction and 90% reduction in turnaround time on key insurance processes. Many insurers are moving into digitizing programs and providing mobile access for customers, in efforts to obtain improvements in business operations as well as customer service. These efforts can differentiate an insurer from the competition and result in improved retention and growth over their competitors.
Emotional intelligence or Emotional Quotient (EQ) is the single biggest predictor of performance in the workplace and the strongest driver of leadership and personal excellence. Research has shown that EQ led to 58% of success in all types of jobs and over 90% of the top work performers have high EQ. Based on those figures, it makes good sense to assess the levels of emotional intelligence of your employees and invest in the development of their EQ.
What is EQ? Many people equate it as being nice to others, but there’s a lot more to it. There are four components to emotional intelligence: 1) self-awareness 2) self-management 3) social awareness, and 4) relationship management.
Self-Awareness means having a comprehensive grasp of who you are as a person and a leader but also how you connect and show up in the world. If you don’t understand your motivations and behaviours, it’s nearly impossible to develop an understanding of others and reduces your ability to think rationally and apply technical capabilities. Without knowing yourself, you can’t master self-control, nor understand and successfully relate to others. You can’t rely on your gut feelings to guide you during difficult situations. Self-aware people know their strengths and weaknesses and how to manage them. They have a better understanding of emotions and how they affect behaviour and can recognise those emotions in others.
Self-management is your ability to control your reactions and impulses. It includes your emotional self-control, transparency, adaptability, initiative, and optimism. This is essential during times of change or chaos when your ability to lead your team calmly is critical, like during a pandemic. Leaders who can control their emotions can think more clearly and think on their feet without letting fear hold them back.
Social awareness involves understanding what is happening for others and using empathy to connect. Socially aware people are considerate of other’s needs, concerns, perspectives, and emotions. They pick up non-verbal cues and interpret them, giving them the power to choose the appropriate response. Leaders who are aware of their impact on social situations modify their behaviour to bring about the result they want. Knowing yourself is the precursor of authenticity. When you’re self-aware, you act and interact in an authentic way, so people relate to you.
Relationship Management involves developing others, initiating and managing change, handling conflict, using the power of influence to achieve goals, and managing team dynamics. Social relationships hold teams together. Through careful building and management of relationships, leaders can influence team performance. This is how leaders inspire teams to support each other, resolve conflicts, and commit to a course of action.
There are several ways in which you can focus on improving your EQ. For instance, you can keep a diary to record and reflect on your experiences. Take an emotional check-up every day. Reflection is critical to developing greater self-awareness, which leads to greater self-management. Without an objective understanding of yourself, you won’t realise your strengths or find areas for self-improvement.
You can also actively invite feedback on your behaviour from people that you trust. Honest feedback helps you to identify and act on any of your blind spots. You can also work with a coach to set goals for improving your emotional intelligence and receive ongoing support as you progress.
If you think EQ is all about being ‘nice’, you’ll never achieve the quality of relationships, the level of influence and the quality of leadership you aspire to. Put simply, EQ can make you a better person and better leader. EQ will help you survive the challenges you face every day and come out stronger and in control. When you see the payoff, you’ll understand why your EQ is worth investing.
CIMP provides Emotional intelligence assessment and training for current and future managers.
The Covid Crisis has resulted in changing expectations of the experienced office workforce. Now that many office employees are now working from home and will likely continue in some hybrid of home and office work, there are more opportunities for these employees to work outside of their travel area. In addition, the pandemic has allowed people to move away from the larger cities to work in smaller communities because travel to the office is limited and will likely be so in the future.
For the insurance industry in Ontario, this has resulted in most insurance employees working from their home and able to telecommute to the office in the larger cities. This has allowed them to avoid the problems of traffic congestion and time delays, saving them the cost of commuting. Some have moved away from the city core and into the suburbs and beyond to smaller towns with the expectation that commuting will be limited in the future.
This offers the mutual community, greater access to more experienced insurance personnel that what was available in the past. Now mutuals can attract candidates with more experienced skills and knowledge obtained from working with larger insurance companies that have training programs. With the ability to offer interesting positions in smaller communities where there is much less traffic issues and a better life/work balance, mutuals are more attractive to these potential insurance candidates.
Canadian Insurance Mutual Professionals assists mutuals with various projects and works with other consultants in the insurance industry to provide help where needed. CIMP has a working arrangement with a top Canadian Insurance recruiting firm that sources qualified candidates for the more difficult to fill roles. Givelos Partners Search (GPS) has been recruiting qualified insurance candidates for over 30 years and has a proven track record of finding the right candidate for the more difficult positions that are not easily obtained by using on-line sourcing tools. Don Givelos was a pioneer in the field of internet recruitment search for the Canadian Insurance Industry but works today on more tailored recruitment searches.