Sandy Scott, the director general of the Chartered Insurance Institute (CII), is warning employers to improve their understanding of graduates or lose out in the “War for Talent”.

He says the insurance sector is characterised by a skills gap between the less experienced workforce and the senior, very experienced employees.

This is made more noticeable by the flattening of organisational hierarchies, stripping away layers of middle management.

But he says the recruitment of bright students is only half the battle, the other half is keeping them.

Scott says: “It's not just a matter of pay, or benefits, but also internal talent management. The organisation must have a culture in place to develop people to their optimum potential.”

The CII warns the brain drain has been exacerbated by the recent trend for skilled workers to switch jobs between different industry sectors rather than remain in the insurance sector.