Transforming through technology

Property and casualty insurance industry needs to embrace IT, new report finds

WATERLOO REGION — The insurance industry, historically, has not been at the forefront of technological change.

Employees traditionally skewed toward an older demographic. And IT was often viewed as an unavoidable cost, rather than a smart, strategic investment.

But a new report from the Insurance Institute of Canada suggests it’s not too late for property and casualty insurance companies to embrace the inevitable transformation — reducing its risks while benefitting from new opportunities.

“It’s really great that the industry is looking at what blockchain can do for us, in an industry that still mails cheques,” said Margaret Parent, the institute’s professionals’ division director.

“There are organizations that are embracing (technology) and are excited about it, and are moving forward,” said Parent, who was in Kitchener on Tuesday to discuss the study prepared by the Conference Board of Canada.

“There are others who are really concerned about what it means for them.”

Over the past decade, millennials have replaced baby boomers as the largest demographic working within the insurance industry in Canada.

Parent believes younger people have both been attracted by the prospect of a greater focus on technology, and have accelerated its adoption.

While technology is expected to increase automation and make some roles redundant, Parent said it may allow junior employees to take on greater responsibilities.

“It’s likely that recruiters and organizations will be looking for university graduates to understand risk assessment, rather than just process claims.”

Overall industry employment is still expected to grow, in part thanks to new markets such as cyber insurance.

The report cautions that prospective skilled employees will be in high demand from a number of sectors, not just insurance — especially if the number of graduates doesn’t keep pace with demand.

Making matters worse, about one-third of the industry’s current IT workforce is expected to retire by 2022.

But the prospect of overall job growth could lead the industry to improve its efforts to diversify its workforce.

Women are already well represented at 62 per cent of the workforce; better promotion of the industry to minority groups could help to address challenges in finding talented employees, a companion report on industry demographics states.