INSURANCE: Diverse, Dynamic and Rewarding Careers

Black Collegian, Apr 2005 by Green, Marvin V

The myth that most professionals in the insurance industry spend their days and evenings selling policies is fading into the landscape. While sales will always be a major peg of the industry, college students and graduates are finding that opportunities in insurance are diverse, dynamic and rewarding.

Gibriel Cham, manager of underwriting and corporate risk at the Housing Authority Insurance Group in Cheshire, Conn., said the insurance industry is attempting to dispel that myth of sales by introducing students to a wealth of other career paths. Cham works in what is called the "captive" part of the industry in which specific insurance needs are marketed to groups with like interests, such as in public housing where insurance may be difficult to obtain.

"The industry has to play a better role in terms of educating the students of other things out there other than sales. Sales is a good way to start if you want to make money. If you are tired of doing sales you can go into underwriting, you can go into accounting, finance, MIS (management information systems) and all of those other things. I think it's a matter of understanding that it's more than just sales to insurance," Cham said.

Unlike other fields where students may know immediately and after they may want to work professionally as an attorney, physician, journalist or accountant, for instance, prospective insurance professionals have to look deeper at career opportunities, Cham says.

"It's kind of difficult at the beginning because all they saw was someone coming and knocking at your door talking to your parents about selling them homeowners policies or auto insurance. You don't see the actual operation itself," he says.

The job of insurance companies is to assume risk. Insurers write policies, thus transferring risks customers face to themselves. Companies provide several classes of insurance - primary property and casualty insurance that protect material goods like cars, homes and business, life insurance to protect people, and health insurance.

In a January 2005 survey, the Equity Research Department at Standard & Poor's in New York noted that the property-casualty insurance industry is facing a number of critical challenges in 2005, including a softening of prices for premiums and heightened regulatory risk. However, the independent investment researcher noted that "the overall industry picture continues to look fairly healthy."

While the U.S. Department of Labor's Bureau of Labor Statistics (BLS) forecasts slower-than-average employment growth for the industry through 2012, it says opportunities will be favorable for persons with the right qualifications and skills. The industry is a trillion dollar business with more than 2.3 million employees in the United States.

Karen Rice, a senior insurance analyst in the risk management department at Marriott International Inc. in Bethesda, Md., a worldwide hospitality company, is a testament to the diversity of insurance careers. Rice worked on the agency side of the business, but found her calling working for a corporation in insurance. She works in international insurance, handling insurance in politically risky global hot spots, and reviews and evaluates insurance contracts for Marriott locations worldwide.

Rice says many insurance professionals find their niches in the industry as they grow in their careers.

"You don't really decide (on an insurance career) when you decided to go to college and said that you want to be an insurance major. No. You kind of fall into it," Rice says.

The BLS' Occupational Outlook says people who are flexible, ambitious and competitive do well in insurance, particularly in the sales area of the industry. Other attributes include interpersonal skills, expertise in a wide range of insurance and financial services products. One trend has multilingual agents in high demand because they can serve a wider range of customers, the BLS say.

The median annual earnings of professionals in sales were $40,750 in 2002, according to the BLS. The middle 50 percent earned between $28,860 and $64,450. The lowest 10 percent had earnings of $21,730 or less. The highest 10 percent earned more than $101,460. Median annual earnings in 2002 in the two industries employing the largest number of insurance sales agents were $40,480 for insurance agencies and brokerages and $42,130 for insurance carriers.

Overall, salaries vary throughout the industry. Independent agencies in some areas may offer starting salaries in the upper $20,000 range, but the larger, national firms typically hire graduates in the mid to upper $30,000 range.

The largest firms by market share by property/casualty premiums written in 2003 were State Farm Mutual Group (10.5 percent of the market), followed by American International Group, Allstate Insurance Co. Group, Liberty Mutual Group and Travelers Property Casualty Corp., according to the Insurance Information Institute, a nonprofit, communications organization in New York sponsored by the property/casualty insurance business. The five largest firms by revenue in property/ casualty are American International Group, Berkshire Hathaway, State Farm, Allstate and Hartford Financial Services.