If the financial crisis has taught us one thing, it's that the benefits of professional training should not be overlooked

One of the most bizarre episodes of the financial crisis occurred when Fred Goodwin and Andy Hornby, the former bank bosses who presided over the collapse of The Royal Bank of Scotland and Halifax. Bank of Scotland, sheepishly revealed to parliament’s finance committee that they didn’t have a single formal qualification in banking between them.

The candor of the men whose decisions brought the UK banking system to its knees has perversely resulted in a sharp rise in the number of people seeking to gain formal qualifications in various areas of finance, including insurance.

“There is definitely an increased focus on professional qualifications following the banking crisis,” says Alasdair Stewart, head of corporate development at the Chartered Insurance Institute (CII). “We’ve seen a consistent increase in people wanting to sit our exams in the past year. I think that moment with the parliamentary select committee underlined the importance of having industry-specific qualifications within financial services. It got us all thinking.”

Because you’re worth it

Although the recession created by the hubris of Goodwin and his banking colleagues has intensified pressure on companies to cut costs, few brokers are prepared to skimp on training.

One broker determined to keep its staff studying is Higos Insurance Services. The Somerset-based group has one of the highest levels of qualified staff in the broking sector, with around three-quarters of its workforce holding recognised professional qualifications.

“We’re continuing to invest in training because it’s good for our business,” says managing director Ian Gosden. “All our new trainees must complete a three-week in-house induction course, which also involves doing a module on housing or motor insurance, or some other specific area. They usually take the CII certificate within a year.”

The CII certificate in insurance is the entrance-level qualification to the industry. It provides a broad overview of the sector and covers basic insurance principles such as regulations, underwriting and claims.

It also provides an outline of principal industry products, such as motor, household, healthcare and packaged commercial insurances. It costs £119 to sit each of the exam’s three modules, or £87 for institute members. Membership costs £70 a year, which also provides access to some CII lectures as well as regular updates on changes to the industry.

“The CII certificate course is modular-based, so people studying for the certificate can select units of study according to their preference or the focus of the broker they work for,” Stewart says. “We also provide an apprenticeship in financial services, which enables entrants to qualify in either NVQ or CII certificate modules along with on-the-job training. It’s government funded, so largely free to brokers, and is a great scheme to enable small brokers to get staff trained.”

State aided

The government-sponsored Train to Gain apprenticeship scheme is delivered through a national network of approved training providers who work with individual employers to ensure each component of the training course fits their business needs.

One broker that has taken advantage of the scheme is Hertfordshire-based One Group. “Basically it’s a 100% government subsidy to train staff,” says chief operating officer Ian Gilmour. “It’s been great, but the funding was recently frozen. If we have to start paying, we estimate it will cost us around £1,000 per employee.”

Unfortunately, Train to Gain has become a victim of its own success. The government halted funding earlier this year when it was clear that demand for training threatened to exceed the budget available. It was finally announced in November that funding will continue but will be cut by 6%.

However, the Conservative Party has pledged to scrap the scheme if elected next year, so anyone wanting to take advantage of it will need to be quick.

Gilmour insists that all new employees at One Group take an NVQ2 in business administration and an NVQ2 in customer services. “It’s important to get core skills right, and these courses do that. Once that is done, staff also study for CII qualifications and we back all that up with in-house training.”

The NVQ2 has two compulsory elements on general office management and an array of more specific options covering everything from managing diary systems and operating credit control systems to dealing with customers and working in a team. NVQs are popular with many employers because they are broad based, but they don’t suit every company, and some firms find the training offered too basic.

“We used to do NVQs, particularly the customer service element,” Gosden says. “But we found that NVQs became less and less relevant to our work as we improved our in-house training.”

Beyond the basics covered by the NVQs and the CII certificate is the CII diploma, aimed at experienced staff looking to specialise in specific areas, such as underwriting practice, claims practice, property claims handling, marine insurance and motor insurance. In addition

to being structured for study in specialist areas, a diploma contains compulsory elements, one covering business practice and another covering insurance law. It costs CII members £107 to sit the exam; £149 for non-members.

There are a series of face-to-face courses to prepare for the exam. Prices vary depending on the subject but start at £100 a day.

After that comes the CII advanced diploma, which is largely focused on management training but includes specialist study. In addition to traditional areas, such as underwriting and claims management, risk management and marketing, the advanced diploma takes in fast-growing disciplines such as Takaful (Islamic insurance), as well as IT for insurance professionals. The advanced level is aimed at insurance managers, aspiring managers and technical specialists, and costs £112 for members or £149 for non-members.

Courses and qualifications in insurance specialisms are also available from a range of providers, such as Lloyd’s Maritime Academy, which runs a raft of courses in various aspects of marine insurance, many of which are available through e-learning.

Going in-house

While most brokers stress the importance of training, few have gone as far as Towergate, which, Victor Kiam-style, liked it so much it set up its own business school.

The Towergate Business School, which has a staff of 15 and takes up an entire wing of the group’s Maidstone headquarters, is divided into four faculties, representing the main facets of Towergate’s business: management and leadership; insurance; sales; and support specialists.

“A couple of years ago we decided to look at our overall strategy for training and out of that we created the school,” says Towergate’s group head of people development,

Fiona Andrews. “One of the important aspects of the school is that we have underwriters in the same class as retail managers and that helps underpin the ethos that everyone here is part of the same jigsaw of our business. It helps with joined-up thinking.”

Courses take place all year round and cater for new entrants and senior managers. Towergate works closely with Hertfordshire-based Ashridge Business School, and regularly sends staff there to study.

“Over the course of the year we send 20 of our leaders [divisional manager level] to Ashridge for three-day residential courses,” Andrews says. The school also works closely with the CII, which occasionally runs courses at the school. About 700 Towergate staff are studying for CII qualifications.

Upper echelons

Management courses are all the rage these days. In addition to the raft of training seminars and courses available through business schools up and down the country, the CII has more than 30 courses covering management topics through its broker academy. Topics range from developing coaching skills to team building and conflict management. Costs are low, with each day-long course typically costing £100.

But increasingly brokers are looking beyond the insurance-focused courses and qualifications for training. Higos regularly sends senior staff on non-insurance courses, such as those run by the Institute of Directors and the Institute of Leadership and Management.

For the really ambitious, not to mention deep-pocketed, there’s the Cass Business School MSc in insurance and risk management, which focuses on the increasing interplay between insurance, risk management and financial services. Holders of a CII advanced diploma can complete the Cass MSc via a “fast track” route in about seven months of full-time study. The part-time version of the course runs over two years and usually involves one late afternoon class and a night class each week. The Cass MSc course costs a whopping £18,000.

That brings us neatly to the issue of how much brokers are prepared to spend on training staff. Cass is clearly at the top end, but earlier this year Higos spent about £7,000 putting 12 senior staff through a management course run by the Institute of Leadership and Management.

“I’ve never given any real consideration to the cost,” Gosden says. “In pounds, shillings and pence, I would say we spent about £150,000 last year on training. But you have to remember that this doesn’t include the time staff spend away from the office on courses or taking exams. That would put the overall figure up to about £600,000.”

Isn’t there a fear that once staff have taken advantage of training programmes they will leave and ply their skills somewhere else? “On the contrary,” Gosden says, “having a good training programme helps retain and recruit staff. It also helps me learn my staff’s strengths and gives me confidence that they are equipped to do their jobs.” IT