Hiring experienced insurance agents is essential to the success of your business.
While technical skills and industry knowledge are undoubtedly necessary, soft skills can make or break an insurance agent’s performance.
In this article, we’ll explore the top three soft skills to look for when hiring insurance agents and provide actionable advice backed by data and statistics.
Challenges In Hiring Agents
Before we discuss proven strategies to help attract top talent to your agency, we must assess the many challenges that often get in the way.
Competition for talent: The insurance industry faces increasing competition from other sectors, such as finance and technology.
According to a report by The Jacobson Group and Aon, “The insurance industry has not traditionally been viewed as a high-growth or high-opportunity industry, and this perception still persists. As a result, insurers are struggling to attract young talent.”
This can make it difficult for insurance agencies to find and attract suitable candidates for open positions.
Lack of Industry Knowledge
Insurance is a complex industry with a variety of products and services. Candidates who lack industry knowledge may require more training and support to get up to speed on the intricacies of the business.
According to a National Association of Professional Insurance Agents (PIA) survey, “71% of agencies cited a lack of qualified job applicants as a top challenge to recruiting new talent.”
This suggests that many agencies struggle to find candidates with the necessary industry knowledge and experience.
High Turnover
The insurance industry has a relatively high turnover rate, particularly among newer agents.
According to a study by The Jacobson Group and Ward Group, “the annual turnover rate for agents/brokers in the insurance industry is 15.3%, with the highest rates of turnover occurring among newer agents.”
This can be costly for insurance agencies, as they must invest time and resources in training new agents to replace those who leave.
Regulatory Requirements
Insurance agents must meet specific licensing requirements to sell insurance.
This can add an extra layer of complexity to the hiring process, as agencies must ensure that candidates meet these requirements before they can be hired.
According to a National Association of Insurance Commissioners report, “each state has its own set of licensing requirements, which typically include pre-licensing education, testing, and continuing education.”
This can make it challenging for insurance agencies to navigate the licensing process and ensure their agents are properly licensed and certified.
Retention
Once hired, insurance agents may leave the agency for various reasons, including better opportunities, burnout, or dissatisfaction with the job.
According to a survey by The Jacobson Group and Ward Group, “employee retention was a top concern for 61% of insurance organizations.”
This suggests that retaining top talent is a key challenge for many insurance agencies, particularly smaller agencies with limited resources for training and development.
Lack of Diversity and Inclusion
Like many industries, the insurance industry has historically lacked diversity and inclusion.
This can make it difficult for agencies to attract and retain candidates from underrepresented groups and can limit the perspectives and experiences of the workforce.
According to a report by McKinsey & Company, “companies in the top quartile for gender diversity are 15% more likely to have financial returns above their respective national industry medians,” highlighting the importance of diversity and inclusion in business success.
Difficulty Differentiating Your Agency
With so many insurance agencies competing for top talent, standing out from the crowd can be difficult.
Candidates may receive multiple job offers, and your agency needs to differentiate itself as an attractive place to work.
According to a survey by the Insurance Journal, “35% of respondents said that a competitive compensation package was the most important factor in attracting top talent,” highlighting the importance of offering competitive salaries and benefits.
Cost of Hiring
Hiring new employees can be costly, particularly for small insurance agencies with limited resources.
According to a Society for Human Resource Management report, “the average cost-per-hire for companies is $4,129,” which can be a significant investment for smaller agencies.
This can make it challenging for agencies to find and hire suitable candidates while staying within their budget.
Retention of Older Workers
The insurance industry faces an aging workforce, with many experienced professionals reaching retirement age.
This presents a challenge for insurance agencies, who must find ways to retain and transfer knowledge from these experienced workers to the next generation of employees.
According to a report by The Jacobson Group and Ward Group, “the average age of insurance professionals is 59, with more than half of the industry’s workforce over the age of 45.”
This means that a large portion of the industry’s workforce is approaching retirement age, and there is a risk of losing valuable knowledge and experience when these workers leave the industry.
Three Vital Skills Your Next Insurance Agent Needs to Have
Communication Skills
Communicating effectively is perhaps the most important soft skill for insurance agents.
Whether they are working with clients, coworkers, or management, good communication skills are essential for building trust, resolving conflicts, and achieving goals.
A study by McKinsey & Company found that “the average knowledge worker spends 28% of their workweek reading and answering emails.” This suggests that poor email communication skills can lead to a significant loss of productivity.
In contrast, companies with effective communication practices had a 47% higher total return to shareholders than those with poor communication practices.
When evaluating candidates’ communication skills, look for those who can articulate complex information clearly and concisely.
They should be comfortable using various communication channels, such as email, phone, and in-person meetings, and be able to adapt their communication style to different audiences.
To assess candidates’ communication skills during the interview process, consider asking behavioral questions such as:
- Tell me about a time when you had to explain a complex insurance concept to a client without industry knowledge. How did you ensure they understood the information?
- Give an example of when you had to communicate bad news to a client. How did you approach the situation?
- Describe a situation where you had to communicate with a coworker with a different communication style than your own. How did you adapt to their style?
Additionally, agencies can use several platforms to help assess communication skills. We’ve listed two below.
Plum.io
Plum.io is a pre-employment assessment platform offering various assessments, including one focused on communication skills. The assessment measures a candidate’s verbal, written, and nonverbal communication skills and provides a report on their strengths and areas for improvement.
Interview Mocha
Interview Mocha is an online assessment platform that offers a communication skills test. The test measures a candidate’s ability to communicate effectively through writing, speaking, and listening, and provides a report on their communication strengths and weaknesses.
Problem-Solving Skills
Insurance agents are often faced with complex problems that require creative solutions.
That’s why strong problem-solving skills are a must-have for any successful insurance agent.
According to a study by the Organisation for Economic Co-operation and Development (OECD), “Adults who are highly skilled in problem-solving are more likely to be employed and earn higher wages than those with lower levels of problem-solving proficiency.”
When evaluating candidates’ problem-solving skills, look for those who can identify the root cause of a problem, generate multiple solutions, and assess the pros and cons of each option before selecting the best course of action.
To assess candidates’ problem-solving skills during the interview process, consider asking behavioral questions such as:
- Describe a time when you had to solve a problem for a client that was outside the scope of your job responsibilities. How did you approach the situation?
- Give an example of a time when you had to devise a creative solution to a complex insurance issue. What steps did you take to arrive at a solution?
- Describe a situation where you had to decide with incomplete information. How did you weigh the risks and benefits of each option before making a decision?
We’ve listed down some top choices that help to assess a candidate’s problem-solving skills:
Criteria Corp
Criteria Corp offers a range of pre-employment assessments, including one focused on problem-solving skills. The assessment measures a candidate’s ability to analyze complex problems, identify potential solutions, and make effective decisions. The assessment is adaptive, meaning the difficulty level adjusts based on the candidate’s performance.
Berke
Berke offers a pre-employment assessment that measures problem-solving skills and other critical job-related competencies such as cognitive ability, personality, and work style. The assessment measures a candidate’s ability to analyze problems, generate solutions, and evaluate the effectiveness of those solutions.
SHL
SHL offers a range of pre-employment assessments, including ones focused on critical thinking and problem-solving skills. The assessments measure a candidate’s ability to analyze information, evaluate options, and make effective decisions. The assessments are designed to predict job performance and can be customized to specific job roles.
Emotional Intelligence
Emotional intelligence, or the ability to understand and manage one’s own emotions and the emotions of others, is becoming increasingly important in the workplace.
Insurance agents with high emotional intelligence are better able to handle demanding clients, work collaboratively with coworkers, and build strong relationships with stakeholders.
A study by TalentSmart found that “90% of top performers have high emotional intelligence, while only 20% of bottom performers have high emotional intelligence.”
The study also found that emotional intelligence was the strongest predictor of performance, accounting for 58% of success in all types of jobs.
When evaluating candidates’ emotional intelligence, look for those who can demonstrate self-awareness, empathy, and social skills.
They should be able to recognize and regulate their own emotions, understand the feelings of others, and communicate effectively in emotionally charged situations.
To assess candidates’ emotional intelligence during the interview process, consider asking behavioral questions such as:
- Describe a time when you had to regulate your emotions in a challenging situation. How did you handle the situation?
- Give an example of a time when you had to work with a difficult coworker. How did you handle the situation, and what did you learn from it?
- Describe a situation where you had to adapt your communication style to better connect with a client with a different emotional state than your own. How did you ensure they felt heard and understood?
Here are some websites that can help you assess emotional intelligence in candidates:
TalentSmart
TalentSmart is a leading provider of emotional intelligence assessments and training programs. Their assessments measure a candidate’s emotional intelligence in self-awareness, self-regulation, motivation, empathy, and social skills. They offer a range of assessments, from basic emotional intelligence tests to more advanced assessments designed for specific industries and job roles.
Emotional Intelligence Academy
Emotional Intelligence Academy offers a range of emotional intelligence assessments and training programs for individuals and organizations. Their assessments measure emotional intelligence in areas such as self-awareness, emotional management, social awareness, and relationship management. They offer online and in-person assessments administered by certified emotional intelligence coaches.
EQ-i 2.0
The EQ-i 2.0 is a leading emotional intelligence assessment many organizations and HR professionals use. The assessment measures emotional intelligence in self-awareness, self-regulation, motivation, empathy, and social skills. Certified EQ-i 2.0 professionals administer the assessment, and results are provided in a detailed report that includes recommendations for development.
Why Edge Should Be Your Top Choice for Hiring Insurance Agents
After discussing the top three soft skills to look for when hiring insurance agents, it’s clear that finding suitable candidates can be a challenge.
Insurance agencies need employees with problem-solving, emotional intelligence, strong communication, and job-specific technical skills.
Partnering with a staffing and workforce management solution provider like Edge can help insurance agencies overcome these challenges. Edge has a proven track record of sourcing and retaining high-quality employees, with a 97% retention rate. They understand the unique needs of insurance agencies and can help create customized staffing plans that meet those needs.
By partnering with Edge, insurance agencies can be confident that all their sourced employees possess the top three soft skills covered in this article and any additional job-specific skills required for success. Edge’s comprehensive staffing and workforce management solutions include everything from sourcing and onboarding to training and managing staff, freeing agency owners and managers to focus on growing their businesses.
Insurance agencies must stay ahead of the curve in today’s competitive business environment. By partnering with Edge, they can do just that. With their expertise in staffing and workforce management, commitment to employee retention and engagement, and innovative solutions, Edge is the top choice for insurance agencies looking to hire and retain the best talent in the industry.
Conclusion
In today’s competitive insurance industry, hiring insurance agents with the right technical and soft skills is more critical than ever.
By focusing on communication skills, problem-solving skills, and emotional intelligence, you can ensure that you’re hiring agents who can build strong relationships with clients and coworkers, navigate complex problems, and contribute to the overall success of your business.
