Risk functions at North American insurers should be recruiting individuals with operational as well as risk backgrounds to develop a clear understanding of the wider business challenges and pressures that senior management faces. That task, however, will not be easy.
According to the Accenture 2015 Risk Management Study, North American Insurance Report, insurers are relatively confident they have many of the core risk management skills and capabilities they need. For example, two-thirds of the study respondents reported they have significant forecasting and modelling skills to a great extent. But when asked about their risk function’s commercial knowledge, an eye-opening zero percent reported having risk specialists with that skill at that level.
Because of the evolution of insurers’ risks, risk managers are attempting to recruit individuals with non-traditional and specialist skills, but they are having mixed results. For example, among the 2015 study respondents, nearly half—48 percent—reported hiring accountants, fraud experts and security specialists over the past two years.
However, far fewer of the study’s respondents—30 percent—reported hiring professionals from outside the financial services industry. That’s a difficult proposition, says Bill Marsh, VP of Non-Financial Risk at Pacific Life Insurance Company. “We can obtain strong candidates with financial skills but face challenges finding candidates with non-technical broader, operational and governance risk skills,” he explains.
Some insurers have suggested recruiting specialists from the banking industry. That, however, could create some challenges for insurers. For example, because of the more prescriptive nature of banking risk requirements, those specialists might face some issues transitioning their risk skillset to the insurance sector.
At the same time, other insurers are looking at improving their risk team’s interpersonal skills. Mark Verheyen, Senior Vice President & Chief Risk Officer at CNA, says he has been developing his talent’s communications skills. “I am looking to grow talent to more effectively communicate. Individuals with a quantitative base that can communicate will provide significant value. It has been helpful to look at sharing skills and talent between underwriting and reinsurance to help increase our skills and perspectives within my team.”
- Read Accenture 2015 Risk Management Study, North American Insurance Report, part 1: Repositioning the risk function
- Read Accenture 2015 Risk Management Study, North American Insurance Report, part 2: Shaping digital decisions
- Read Accenture 2015 Risk Management Study, North American Insurance Report, part 3: Re-emphasizing operational risk management
- Read Accenture 2015 Risk Management Study, North American Insurance Report, part 4: Increasing the focus on data and analytics
- Download the North American Insurance Report
- Download the Global Insurance Report