The Insurance Industry Has Opportunities for Just About Any Major

By M.V. Greene

You may not think of attending college specifically for a career in insurance, but you will find that the insurance industry and the broader field of financial services offer a variety of enticing opportunities.

"I think students are surprised to hear that we hire from business programs as well as liberal arts programs. We even have opportunities for engineers in our Loss Prevention group," said Nikki Soares, principal HR generalist in Corporate College Relations at Boston-based Liberty Mutual Group. "There are opportunities here for just about any major. We are looking for self-starters who are willing to roll up their sleeves and get the job done."

Insurance is a trillion-dollar business with a U.S. workforce of more than 2.5 million. The U.S. Department of Labor's Bureau of Labor Statistics categorizes the industry as part of the "financial activities supersector," which also includes fields like real estate and finance. Insurance itself contributed $270 billion to the nation's gross domestic product in 2004, according to the Insurance Information Institute, a New York insurance trade organization.

The industry is segmented into major components of property/casualty, which includes insurance that covers homes, automobiles, businesses and other property in the event of accidental loss; life insurance, which provides financial security to individuals in the event of death and disability; and health coverage for preventative services, medical expenses and catastrophic care.

Insurance companies are fixtures each year on the Fortune 500 list of the largest American corporations. Among property/casualty insurance owned by stockholders, American International Group, Berkshire Hathaway, Allstate Insurance Co., Hartford Financial Services, St. Paul Travelers Cos. and Nationwide all reside in the top 100 on the Fortune list. The State Farm Insurance Cos., the largest of the property/ casualty mutual insurers, which are owned by policyholders, ranked No. 22 on Fortune with revenues of $59.2 billion. In the life insurance area, Metropolitan Life and Prudential Financial were in the top 100.

State Farm Executive Vice President Willie Brown said the significance of the insurance industry cannot be understated.

"We sell piece of mind, and we sell security to the public," Brown said.

Large insurance carriers such as State Farm, which is headquartered in Bloomington, IL accounted for 62 percent of jobs in the industry with the remainder at insurance agencies, brokerages and providers of insurance-related services. About 151,000 workers were self-employed in 2004, mostly as insurance sales agents. While insurance carriers have large workplaces typically of 250 workers or more, the majority of establishments in the industry, are small entities, frequently employing fewer than 20 workers.

State Farm relies on its sales associates to be forward-thinking and entrepreneurial, Brown said.

"In our organization, nothing happens unless an agent sells a policy. We offer tremendous entrepreneurial opportunities for those that want to own their own businesses. They determine how much money they can make based on how hard they're willing to work and how much time they're willing to put in selling what we believe is a very essential product," said Brown.

Many insurance carriers' home and regional offices are located near large urban centers. Insurance workers who interact directly with the public, such as sales agents and claims adjusters, are located throughout the country. Almost all insurance sales agents work out of local company offices or independent agencies. About 44 percent of insurance employees work in office and administrative support jobs, according to the Bureau of Labor Statistics' Occupational Outlook report. About 28 percent of workers are in management or business and financial operations occupations.

Insurance carriers initially hire students into core insurance functions such as claims, underwriting and sales, but recruiters said career progressions in the industry offer variety and opportunity. The Bureau of Labor statistics puts entry-level salaries in the $25,000 range for actuaries, agents/brokers, claims adjusters and underwriters, though median salaries range higher.

"Individuals that start out in one area of the company might not finish in the same area of the company. They might progress through other divisions. They might be in claims, and the next couple of years it might be in marketing. We have many departments and many opportunities for students," said Jeff Truskowski, a senior recruiting manager at Allstate Insurance Co. in Northbrook, IL.

In claims, for instance, adjusters, examiners and investigators decide whether claims are covered by the customer's policy. Adjusters also inspect property damage, estimate how much it will cost to repair and determine the extent of the insurance company's liability. Underwriters, who work within the management and business and
financial function, evaluate insurance applications to determine the risk involved in issuing a policy. About 101,000 underwriters worked in the industry in 2004, most of them for carriers, according to the Bureau of Labor Statistics.

About 400,000 people worked as sales agents in the industry in 2004, selling different types of products, including life, annuities, property-casualty, health and disability insurance. In addition, an increasing number of agents have the training to "cross sell" – offering comprehensive financial planning services that include retirement, estate and pensions planning. Median annual earnings of agents were $41,720 in May 2004, according to the Bureau of Labor Statistics. The middle 50 percent earned between $29,980 and $66,160, while the highest 10 percent earned more than $108,800.

Truskowski said when Allstate recruiters visit college campuses they often hear from students, "I really think Allstate is a good company, but I don't want to sell insurance." Truskowski said recruiters then point out that companies with the size and reputation of Allstate offer virtually endless career opportunities.

"We try to educate them that although our sales agents are entrepreneurs and a very critical part of the company, we also have 14,000 claims employees around the company. We have a strong actuarial department, and that's important. We have a large IT department. Just like every other large company, you need IT to help run the business. And finance is another strong area for us," he said.

In recruiting students and graduates, Liberty Mutual's goal is to acclimate candidates to career opportunities as quickly as possible and let them "chart their own paths," Nikki Soares said.

"Our jobs offer real business experience right away. We also provide training and support to give new hires the tools they need to succeed on the job. The career paths can vary depending on the functional area and the programs offered. Throughout the organization, we support lateral and vertical progression that matches the employee's interests and the changing needs of the business," she said.

When students eye the insurance industry, they will see a steadily growing industry creating many new job opportunities. For the period 2004-2014, employment in the overall financial activities supersector is projected to grow 10.5 percent – driven largely by the affluent and maturing baby-boomer generation seeking financial and other investments and related activities, according to the Bureau of Labor Statistics.

Insurance carriers and related companies are expected to grow by 9.5 percent in the segment and add 215,000 new jobs by 2014. Growth is projected to be even higher within individual insurance agencies and brokerages and with other related activities – about 19.4 percent – as many insurance agents set up their own businesses.

Craig Barnes, a civil litigation attorney with the law firm of Sedgwick, Detert, Moran and Arnold and president of the African-American Insurance Professionals Association in Los Angeles, said opportunities exists in insurance for students because the industry touches so many business and legal areas. The organization was founded in 1994 to develop African-American professionals who are employed in or vend to the insurance industry. The organization also awards scholarships to students.

"Virtually none of our members started out becoming insurance professionals when they were in school. Almost none of our scholarship recipients expressed an interest in insurance. There are opportunities because claims get made and they have to be resolved," Barnes said.

The internship route through college clearly represents a keen way to enter the industry. While some office and administrative support positions allow entry with a high school diploma, insurers prefer to hire those with college degrees for most jobs, including sales, managerial and professional. A degree is required, for instance, for beginning underwriting jobs.

Northwestern Mutual of Milwaukee recruits an average of 1,000 financial representative interns annually for its Northwestern Mutual Financial Network, giving students an opportunity to "test drive" the same career as full-time representatives. Representatives sell products that include life, disability and long-term care insurance, annuities and mutual funds.

Interns must be enrolled in a minimum of 12 college credits and possess qualities like strong interpersonal skills, self-motivation and history of personal success. Ideal candidates will demonstrate dedication, discipline, balance and a competitive nature. Having community service also helps.

"We believe that the most important thing for a successful internship is learning as much as you can, making sure that you not only learn about the work that you're doing or the skill that's needed to do that work, but also learning about yourself," said Northwestern Mutual's Karen Lindsey-Lloyd, Director of Field Diversity, who is responsible for overseeing the national diversity efforts.

Recruitment into insurance is competitive, and the major companies maintain close ties with colleges, including Historically Black Colleges and Universities. Truskowski of Allstate said the company's college recruiters regularly work with professors at colleges, participate in job fairs and career seminars, and make presentations directly to prospective employees in classrooms.

In the insurance industry, companies and organizations offer specialized training to college graduates entering the field. The National Association of Health Underwriters, for instance, offers certification programs for those in the field. And another organization, the American Institute for Chartered Property-Casualty Underwriters, offers certification courses covering topics like risk management and personal and commercial loss exposures. Additionally, licenses are required in some insurance disciplines whose requirements vary by state.

Lindsey-Lloyd said today is a good time especially for African-American students to consider careers in insurance amid changing national demographics. Minority groups and women, for example, are starting businesses at a dynamic rate and have increasing insurance and financial needs. The insurance industry needs workers to service the growing interests of these populations, Lindsey-Lloyd said.

"We're seeing a growth in the affluence of minority populations. There are some tremendous opportunities in our field because those individuals are looking for people like them to help them with their financial security needs. The number of small businesses being started is just tremendous, and the growth in general affluence of minority populations is increasing," Lindsey-Lloyd said.

Harold Gray, director of the Center for Insurance Education and director of the Center for Professional Development at Howard's School of Business, which offers a major in insurance, said the insurance industry is as vibrant as ever.

"It's a phenomenal industry," Gray said. "The great thing about this trillion-dollar industry is that you can major [in any subject] and work in this industry."

Gray said the industry has done a great job at marketing – with terms like "good hands," (Allstate) "like a good neighbor" (State Farm) and "the rock" (Prudential). Gray said now it is time for the industry to reach out and market as aggressively to students, like those at Howard.

"The industry itself has done a poor job in marketing the career opportunities that are available. What we've done a great job of is marketing companies," Gray said, adding that the industry is now trying to inform students "about what is under the rock – that you've got underwriting under the rock, you've got loss control, you've got finance, you've got accounting. You can do all these things in this industry."

M.V. Greene is a freelance writer and frequent contributor to THE BLACK COLLEGIAN Magazine.