Compensation trends in the insurance industry (1)

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Presentation to the National Association of Mutual Insurance Companies HR & Finance Summit August, 2013 in San Antonio, TX.

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Compensation trends in the insurance industry (1)

  1. 1. PayScale Tim Low, VP Marketing timl@payscale.com Karaka Leslie, Business Development karakal@payscale.com COMPENSATION BEST PRACTICES Trends in the Insurance Industry
  2. 2. www.payscale.com 14,000 Positions 2500 Customers 40 Million Salary Profiles 250 Compensable Factors 11 Countries
  3. 3. www.payscale.com The Market is Volatile o The recovery of the economy and profits and the compensation lag o The latest trends in HCM & compensation o The on-going war for talent and the impact on compensation o Results of the PayScale 2013 Compensation Best Practices Survey
  4. 4. www.payscale.com Macro & Insurance Industry Trends
  5. 5. www.payscale.com *University of Wisconsin Center for Cooperatives Research http://reic.uwcc.wisc.edu/mutualinsurance/ Mutuals: $2B in Direct Wages $26B in total Wages $2B X .05 = $100,000,000
  6. 6. www.payscale.com Where Mutual Co Employees work: Lots of places…
  7. 7. www.payscale.com Exercise #1 Guess the Trends
  8. 8. www.payscale.com PayScale Index Labor Market Trends
  9. 9. Compensation Volatility ‘07-’13
  10. 10. National vs. Insurance ‘07-’13
  11. 11. Small vs. Large Companies ‘07-’13
  12. 12. www.payscale.com Job Trends
  13. 13. HR Jobs vs. Finance Jobs ‘07-’13
  14. 14. Hot Jobs in the Insurance Industry Q2 2011-Q2 2013 0.00% 5.00% 10.00% 15.00% 20.00% 25.00% 30.00% Operations ManagerClaims Adjuster / Examiner / InvestigatorInsurance BrokerInsurance AgentSenior Business AnalystPersonal Lines Manager (Insurance)Customer Service SupervisorActuarial AnalystFinancial AnalystClaims ProcessorInsurance Appraiser, Auto DamageBusiness Systems Anal
  15. 15. www.payscale.com Exercise #2 What’s Your Purple Squirrel
  16. 16. www.payscale.com • Surveyed over 4,000 respondents • Themes: – Financial Performance – Hiring Practices – Retention Concerns – Wage Growth – Managing Increases • Company size breakdown: – Small: < 100 employees - 45% – Medium: 100 - 1,000 employees - 34% – Large: >1,000 employees – 21%
  17. 17. www.payscale.com General Trends: Financial Performance
  18. 18. www.payscale.com 67% of respondents in Insurance industry expected financial situation to improve in 2013 Insurance Trends: Financial Performance
  19. 19. www.payscale.com General Trends: Hiring Practices
  20. 20. www.payscale.com Insurance Trends: Hiring Practices
  21. 21. www.payscale.com General Trends: Retention Concerns
  22. 22. www.payscale.com 67% of respondents from the Insurance Industry cite retaining top employees as their primary compensation objective in 2013 Insurance Trends: Retention Concerns
  23. 23. www.payscale.com General Trends: Wage Growth
  24. 24. www.payscale.com 87% of respondents from the Insurance Industry gave raises in 2012 90% of respondents from the Insurance Industry say they will give raises in 2013 Insurance Trends: Wage Growth
  25. 25. www.payscale.com Market Trend: Ongoing Shift Toward P4P Source: Hewitt Survey – U.S. Salary Increases 2009/2010 and Impact on Org Spend for 2010 When crafting next years budget vs. this year the use of Across the board increases down by 50% Use of Variable Pay has increased 300%
  26. 26. www.payscale.com Insurance Trends: Performance 67% of respondents from the Insurance Industry planned on performance being the primary reason for increases
  27. 27. www.payscale.com Prioritized Treatment Not all individuals, process, functions and business units have the same impact on results We need to prioritize jobs, key employees and business units and then allocate the greatest portion of its resources to those high priority areas. Ideas: o Recruitment o Base Pay o Incentive Pay o Perks & Fringe benefits o Recognition
  28. 28. www.payscale.com 12 Names in Drawer
  29. 29. Pay Spread at Most Profitable Companies
  30. 30. www.payscale.com Exercise #3 Top Comp Priorities
  31. 31. www.payscale.com Elementary • Know your jobs • Have an understanding of the market Intermediate • Discuss a compensation strategy with leadership • Know what you want to reward and what you value • Build guidelines that reflect a compensation strategy that works for your business Advanced • Find new and creative ways to incorporate performance pay • Know how your pay practices stack up against your exact competition for talent • Communicate your pay strategy with management • Develop a strong compensation structure Takeaways
  32. 32. www.payscale.com Q&A
  33. 33. o Ever-fresh Compensation Data o Subscription Software to Create and Manage Comp o Compensation Plan Design Karaka Leslie, Business Development karakal@payscale.com Tim Low, VP Marketing timl@payscale.com Thank You!

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