The insurance industry in Australia is facing a pressing talent shortage, driven by an ageing workforce, the rapid adoption of technology, and shifting expectations of modern workplaces, according to AXA XL Australia country leader Catherine Carlyon.
These challenges have spurred industry-wide initiatives aimed at enhancing the sector’s appeal and ensuring its long-term sustainability.
Carlyon noted data highlighting a stark age imbalance in the insurance workforce.
While 58% of insurance employees are over 45 years old, only 18% are under 34 – a contrast to 40% of younger workers in the broader Australian workforce. By 2030, 30% of insurance professionals will reach or exceed retirement age, intensifying the talent gap.
These demographic trends, coupled with heightened competition for talent from industries perceived as more innovative or socially impactful, present a significant challenge.
Carlyon said that prospective employees often view insurance as rigid and uncreative, deterring interest from younger talent pools.
Recent findings from the Australian and New Zealand Institute of Insurance and Finance (ANZIIF) underscore the mental health challenges facing insurance professionals. In a 2024 survey, 48% of respondents reported a decline in mental health linked to workplace stress and public perceptions of the industry.
To address these challenges, the Insurance Council of Australia (ICA) has launched a Talent Roadmap, outlining a six-year plan to attract and retain talent. Key priorities include:
The roadmap also seeks to share lessons with international counterparts and expand opportunities for workforce accreditation, both domestically and abroad.
At AXA XL, initiatives aimed at fostering an inclusive and flexible workplace are introduced to retain talent. The company has introduced policies such as gender-neutral parental leave and hybrid work arrangements, while prioritising diversity and inclusion.
Carlyon highlighted the importance of mentorship, sponsorship, and professional development as ways to attract and retain employees.
“In Australia, we’ve been fostering a culture that is open and flexible, trusted, and respectful. We celebrate diversity, and inclusion is a given. We challenge each other, and we are accountable,” she said.
The industry’s difficulties are compounded by the increasingly complex risk environment.
AXA XL’s Future Risk Report 2024 highlights climate change, geopolitical instability, and cyber threats as the top emerging risks. These challenges require innovative problem-solving, technical expertise, and collaboration, making the need for skilled professionals even more urgent.
For instance, insurers are integral to helping communities and businesses adapt to climate change by supporting disaster prevention measures, advocating for updated building codes, and facilitating recovery after natural catastrophes.
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Carlyon urges industry leaders and professionals to act as ambassadors, sharing their experiences to counter misconceptions about the sector.
“Sharing your experiences can help debunk myths about the industry and highlight the many positive aspects. We can all work on changing the narrative and help attract talent to exciting and rewarding careers in insurance,” she said.
She further explained that continuing to invest in workforce development, foster inclusive work environments, and embrace technology would help the insurance industry attract a new generation of professionals capable of meeting the challenges of an increasingly interconnected and risk-prone world.
“Ultimately, these efforts will help the industry attract and retain the next generation of talent and meet the evolving needs of our customers in an increasingly complex and risk-laden world,” Carlyon said.
