2022 Insurance Salary Report: Observations
On January 2nd, we will release our 19th Semi-Annual Insurance Salary Report to our clients (and on LinkedIn) covering the WDC metropolitan region including Virginia and Maryland for the period ending December 31, 2022.
This report is based on data collected from our 2022 placements and prospective candidates that have been interviewed and voluntarily provided their compensation levels.
Salaries have been cooling off the past few months in exchange for many firms now providing remote work environments for their employees. In a recent survey, we found that candidates value working remotely much more than simple salary increases. Welcome to the New World we now live in.
Here is my take on things:
Winners & Losers:
a. EB vs. P&C: Employee Benefits continues to outpace their P&C colleagues in terms of annual compensation. In the past five years, EB account managers have seen their compensation increase by 26.3% in large independent agencies/brokers and 32.5% in smaller independent agencies (less than 25 employees). By comparison, their P&C account manager colleagues have only seen their salaries increase by 11.7% and 19.3%, respectively.
b. RTW vs Remote: Labor Day 2022 seemed to mark the time when firms started calling back their employees to the office. These are mostly national firms. The jury is still out on this, but early results are mixed. I know of one particular large firm that experienced an exodus of top talent following their decision to go “RTW” in October. They recently revised this policy to allow experienced staff to continue to work remotely. I know of another that simply cannot fill several open positions because most top talent is very reluctant to leave a remote position for a commuter position.
c. Quiet Quitting/Firing/Hiring: I have blogged extensively this past year on these topics, but it is interesting to see how the smart workers are taking advantage of this. They continue to work hard and are seeing more promotions simply because a percentage of their colleagues are “quietly quitting.” The smart employees are seeing this as a golden opportunity to get ahead.
d. The Great Resignation: Except in the very experienced segment (35 years + experience), I am not seeing this at all in the insurance sector although the average age of the insurance employee does seem to be climbing!
So What’s Next?
a. RTW vs. RWE: I see the RTW (return to work) vs RWE (remote work environment) dynamic evolving into a situation where experienced insurance professionals are ultimately given the opportunity to continue to work remotely, or at least, on a Hybrid basis, if they live within commuting distance. Otherwise, these firms will lose top talent in a market where top talent is already scarce and at a premium. Market scarcity is only going to get worse as fewer and fewer young people enter the insurance field. New hires will have to be trained and indoctrinated, so they will be hired as commuters.
b. Observations on Remote Workers: I do a lot of executive and life coaching in the insurance sector and I am starting to see many folks who work 100% remotely experiencing some remorse now. One of the reasons is that their office-based colleagues are closer to the senior executives and get more opportunities which leads to promotions. Workforce alienation amongst remote workers is something we are closely watching in 2023.
c. M&A activity to slow in 2023. Most of the private equity players and senior executives see a slowing of the acquisition activity in the WDC metro region for 2023. Increased interest rates and the cost of borrowing are making it much more expensive to purchase smaller agencies now at the increased valuations that have been established over the last few years.
For a copy of our 2022 Insurance Salary Survey, just email me at email@example.com and I will get one out to you.