Insurance Times’ and Hays’ salary survey has revealed just what employees think about their jobs, prospects and the industry itself. Ellen Bennett reports

Despite inflation-busting pay rises for some employees, salaries in the insurance sector still lag behind other professions and financial services, according to the Insurance Times Salary Survey 2007, in association with Hays. Perhaps this goes some way to explaining why one in every two employees is likely to change career path in the future, even though the majority are fairly positive about their current employers.

With skilled and loyal workers ever more precious, the insurance sector continues to pay much less than its competitors. In 2008, an entrant to an insurance career in London could expect to earn from £19,425 as a claims technician up to £24,000 for an underwriting technician or £30,000 as an account executive. By contrast, an entrant to banking would be looking at a healthy £35,000-£38,000 in corporate finance or mergers and acquisitions, with a further 20%-30% in bonus payments.

But it is not all bad news. Firms are paying considerably more for junior and middle ranking staff than they were 12 months ago – perhaps a sign that the sector is realising it needs to compete for quality staff.

Pay increases

Using regional average figures, a junior account handler with up to two years’ experience saw an 8% increase from 2007 to 2008, from £15,833 to £17,129. Claims technicians could boost their expectations by 7%, from £14,458 to £15,539, and underwriting technicians by an impressive 10%, from £14,182 to £15,532.

Employees with up to five years’ experience were also quids in. Again, underwriting technicians enjoyed the largest rise with salary expectations soaring 14%, from £16,500 to £18,891. Account handlers or brokers with three to five years experience enjoyed a 9% rise, from £20,333 to £22,239; account executives a 7% rise from £24,625 to £26,325; and claims technicians 6%, from £25,667 to £27,309.

Across Britain as a whole, many senior staff are enjoying pay rises well above the national inflation figure of around 3%. Underwriting managers came out on top once again, with a 12% rise from £41,167 to £46,168. Claims managers also benefited, with a 10% increase from £37,417 to £41,339. Account executives saw a steady rise of 8% from £33,500 to £36,182; and account handlers/brokers 6%, from £27,333 to £28,900.

But it was a different picture in London, where account executives and claims managers of 11 years’ or more experience saw their average salaries remain static, at £50,000 and £75,000 respectively. Underwriting managers enjoyed a modest 5% rise, from £60,000 to £63,000 and account handlers/brokers, a 12% leap from £40,000 to £45,0000.

Middle ranking and junior staff working in the capital also received less of a boost than their regional colleagues, with claims and underwriting technicians of up to five years’ experience both seeing a 5% rise from £25,000 to £26,250. Junior claims technicians saw a measly 0.5% rise, from £18,500 to £19,425. The only winners were underwriting technicians, in great demand, with salary expectations rising 20% from £20,000 to £24,000.

Extra benefits

What other financial incentives can insurance workers expect? With 43% of respondents saying that their commission and/or bonus payments totalled less than £1,000 over the previous 12 months, it is clear that insurance has a long way to go before it can rival the bonus culture of banking and accountancy.

󈬻 per cent said they would recommend their current employer to a friend

Additional company benefits are also thin on the ground. The most common was unsurprisingly a pension, although the percentages benefiting from a company pension seem low compared to other sectors: 16% of respondents participated in a contributory pension, and 7% a non-contributory pension.

In line with the limited bonus payments, a mere 5% enjoyed profit share, and 8% share options.

So if insurance employers are reluctant to hand over the cash, are they any more generous with other benefits? 11% of respondents had a company car or car allowance. Perhaps unsurprisingly, a significant minority enjoyed company insurance, with 12% benefiting from life insurance and 14% from health/medical insurance. Just 12% named training as a benefit – a higher number than enjoy lifestyle benefits such as discounted gym membership, which stood at a measly 7%. And for those employees wanting to get away from it all, there was little comfort in the fact that only 2% of them could rate company travel as a benefit.

Despite lower than average benefits and negative perceptions of the insurance industry, a majority of employees were positive about their own employers, with an impressive 75% saying they would recommend their current employer to a friend.

Even more encouraging, 78% of respondents found their current job “enjoyable” or “very enjoyable”, suggesting that the negativity centres more on perceptions of the insurance industry as a whole than individual companies and roles within them.

Continuing in this vein, staff loyalty was fairly impressive, with 64% of respondents saying they would be “very likely” or “fairly likely” to stay with their current employer if they were offered a new job and then received a comparable counter-offer.

Just 13% said they would be “very unlikely” to stay put.

The stability of a career in insurance shone through, with 80% of respondents claiming to feel “secure” or “very secure” in their current role. Just 4% said they were “not at all secure”, and 16% “not very secure”.

And despite the tremors shaking the global economy, respondents were sanguine about the health of the insurance industry – 73% were “very optimistic” or “fairly optimistic” about the insurance industry over the next 12 months, compared to 23% who were “fairly pessimistic” and 4% who were “very pessimistic”.

Given this optimism, it is perhaps surprising that 25% of respondents were “very likely” to change careers in future, and 24% “fairly likely”. As this lack of long term commitment to the insurance sector cannot be attributed to fears about its economic stability, or issues with individual employers, it seems it must be an industry-wide problem with remuneration, perception and staff retention.

Survey sample

Which competitor firm do you most admire and why?

I admire well organised and structured companies, said one respondent in a fairly typical reply. Though the number of companies named was high, the reasons given were similar, with most respondents choosing firms for their technical skill or solid reputation. There was a bias towards size, with a number of respondents talking of the benefits of national organisations. Unsurprisingly, consideration was also given to how firms treat their staff, with Hiscox, Chubb and RBS frequently named as top performers. A small number of responses spoke of frustration either with current employers or with the industry as a whole, with one simply stating: None, because of the poor service they provide and the contempt in which they hold their staff.

Responses included:

RBS: known benefits, bonus schemes, staff benefits, breadth of career opportunities.
Hiscox: anything else would be a step down.
Chubb: good standard of working conditions, ethical and staff enjoy the environment.
Norwich Union: it appears to understand the customer better than anyone else.
Aon: well respected and does not usually get any bad press.
AIG: large player, keen to write new business and can act quickly when making decisions.
Berkshire Hathaway: it is prepared to take risks and act accordingly.
Groupama: it seems to be making the right noises in a rather static market.
Fortis: it seems to recruit the best people available, so its benefits must be good.
Willis: large professional organisation
Heath Lambert: market leading schemes facilities and reputation.
Towergate: it has a very strong vision and ruthless execution.
Jardine Lloyd Thompson: one of the few remaining brokers with a British corporate philosophy.