Fields within Insurance

The insurance industry is rich with variety among the careers it offers. Many careers in insurance pay well and offer security, flexibility, and career growth.
Insurance is a growth industry. As individual wealth rises, populations expand, and people live longer, the demand for insurance will continue to grow. In addition, as technology has reshaped how we transact business in other areas of our lives, it is also transforming the insurance industry as well. Technological advances are creating new insurance fields, and this mean more insurance careers.

Insurance careers involve helping individuals and businesses protect themselves financially against potential losses in the future. Insurance professionals help clients assess the financial risks in their lives, and identify insurance products that can help minimize those risks.

Some of the most common insurance careers are insurance agent, underwriter, claims adjuster, actuary, marketer, and customer service representative.

According to the Bureau of Labor and Statistics, the insurance industry employs approximately 2.3 million Americans. Insurance carriers (such as MetLife, Aetna, and Allstate) account for 61 percent of the insurance jobs. Insurance carriers are the actual insurance policy providers (as opposed to local insurance sales and service offices). They provide the insurance protection and assume the risks covered by the policies.

Insurance agencies, brokerages, and providers of other insurance-related services employ the remaining 39 percent of insurance professionals. These are the people and organizations that sell insurance policies for the carriers. Some agencies and brokerages are directly affiliated with a particular carrier. Yet others are independent and able to market policies offered by a variety of carriers. Some insurance companies (like Northwestern Mutual Life Insurance Company) only allow their policies offered by their own company's sales agents. The majority of carriers, however, will allow independent agents to sell their products.

Independent Insurance Agent

An insurance agent is the person who sells insurance to consumers. Insurance is a conceptual product; other than a policy document, there is not anything that a client can see or touch. This is why the role of the agent is so crucial. The agent must explain the risks the individual faces and explain how insurance coverage can mitigate those risks.

Insurance agents typically sell more than one type of insurance. Although most insurance agents specialize in a certain protection segment, such as life and health (which includes disability and long-term care) or property and casualty insurance, a growing number are becoming "multiline" agents. Multiline agents sell all types of insurance, including general liability insurance .

Agents are responsible for finding customers and placing business (making sales). Companies often set productivity requirements that dictate how many policies must be sold for an insurance agent to maintain their status and benefits as a representative of the company.

There are nearly half a million insurance agents in the United States. About half of those professionals work for insurance agencies and brokerages. Insurance carriers employ approximately 21 percent directly. A small number of agents work for banks and securities brokerages. Approximately 22 percent of insurance agents are self-employed.

Successful insurance sales agents have the following traits:

    Fields within Insurance
  • Self-motivated with desire to succeed. Insurance is not easy to sell. The most successful insurance professionals are the ones that are extremely self-disciplined. A strong work ethic and desire to succeed are traits that good insurance professionals share.
  • High energy. The typical day for an insurance agent starts early in the morning and extends late into the evening. Sales agents often meet with several prospects throughout the day, and in between meetings, they return phone calls, serve existing clients, network, and make future appointments. Of insurance careers, that of the sales agent is the most fast-paced.
  • Willingness to work long hours. Insurance sales agents must meet with clients when they can. Often that means nights, weekends, and holidays. They also spend a considerable time with networking and community organizations in an effort to meet new prospects and gain credibility.
  • Good listening skills. Listening skills fall under the radar screen in many professions, but not for insurance agents. Listening skills are critical to get to know what clients truly need for insurance protection. Because it is such a valuable skill, many insurance companies even offer courses to develop listening in agents.
  • People person. Sales agents constantly work with the public. A sales agent must genuinely enjoy interacting with people.
  • Outstanding communication. Insurance contracts can be quite complicated. Much time is spent educating clients on how the contemplated insurance works. It is important for an insurance professional to be able to communicate the particulars of a product or process clearly and articulately.
  • Good reputation. The quality of an insurance agent's reputation dictates how successful he or she will be. Agents who do right by clients earn trust, get referrals, are rewarded by the carriers, and grow their practices.
  • Honesty and integrity. Insurance agents should always put clients' interests above their own. This means guiding clients to make decisions based on their unique needs, and not toward product choices that will generate the highest commissions.
  • Dependable. Insurance agents must do what they say they are going to do and be where they are scheduled to be on time.
  • Advancement is typically based on ability to attract and service clients.

Independent sales agents generally work on a commission-only basis. Sales workers employed by an insurance agency or carrier could be paid salary, salary plus commission, or salary plus bonus. Experienced agents are usually paid commission only.

The Bureau of Labor Statistics sites the average salary for insurance sales agents as $45,430. The top 10 percent of sales agents earned in excess of $113,000 per year.

Underwriter

Underwriters determine whether insurance is to be provided to an applicant, and if so, how much the customer should pay. In making these decisions, underwriters must assess the risks posed by each applicant.

Many factors influence an underwriter's decision. For example, life insurance underwriters evaluate the applicant's age, gender, medical history, employment, smoking status, and hobbies in determining whether to issue the insurance. A seventy-year-old smoking skydiver, for example, would be rejected because the risk that he would die before the company collected enough premiums to cover the death claim would be too great.

Sloppy underwriting practices could signal a carrier's demise. If the underwriters assume subpar risks or quote premiums that are too low, the company could lose money over time.

The insurance field is competitive. Many insurance applicants shop their policies around to several carriers to find the best offer. Therefore, if underwriters are assigning rates that are too high, they will lose business to the competition.

Insurance carriers employ approximately 67 percent of insurance underwriters. The remaining underwriters in insurance work in brokerages and agencies.

Insurance careers in underwriting require:

  • Attention to detail. Good underwriting involves the ability to detect details and information that lead to appropriate risk assessments. One must have a keen attention to detail and an ability to focus on the application at hand. Applications are often accompanied by reports from loss-control representatives, medical records, and actuarial studies. All these documents must be carefully reviewed in making the underwriting decision.
  • Strong analytical skills. Underwriters consult actuarial data to determine the premiums each application should pay. Therefore, the underwriter must have strong analytical skills and exercise sound judgment.
  • Insurance knowledge. To assess risk, an underwriter must fully understand how the insurance works.
  • Computer skills. Underwriters often work with sophisticated computer software to evaluate insurance applications and make risk determinations. While most insurance carriers provide training on proprietary software, candidates should have a general comfort in working with computers.
  • Well organized. Delayed underwriting decisions cost the carrier profits and leave individuals unnecessarily uninsured. Underwriters must be organized and efficient.
  • Heightened sensitivity to client confidentiality. Underwriters have access to highly sensitive personal information, such as medical and financial information. The underwriter has a duty to ensure the information remain confidential at all times. Most insurance carriers have strict procedures for the handling of all client information and often require underwriters to sign confidentiality agreements.
  • Negotiation skills. Agents and end-customers sometimes challenge an underwriter's decision. It is often a result of the customer applying to several insurance companies and looking for the best deal. The underwriter must balance company and client interest and negotiate the best solution.
  • A bachelor's degree is pretty much the minimum educational requirement. A concentration in business administration or finance is a plus. New hires typically start as assistant underwriters and work with someone more experienced.

The average salary for an underwriter who works with an insurance company is $57,480, while those working in brokerages, agencies, or other insurance settings earn on the average $54,410 per year. The most highly paid underwriters (top 10 percent in the field) earn more than $99,940.

Claims Adjuster

Claims adjusters, sometimes called insurance adjusters, determine whether a loss is covered with insurance. If they determine that the claim is covered, they then must determine how much should be paid.

Adjusters work in a variety of different environments. Many are employed directly by insurance companies. In those instances, the adjuster could be someone who rushes out to the scene of an accident or incident. For example, property and casualty insurance companies may send claims adjusters out to house fires to determine the extent of damages.

Another example of when claims adjusters are used by insurance companies is to detect insurance fraud. False claims cost the insurance industry millions of dollars every year. To detect fraud, a claims adjuster may go out and visit with a claimant. For example, if a dentist files a claim for disability income insurance and states that he is unable to perform the functions of his job because of an extended illness, a claims adjuster may pay him a visit to assess the validity of the claim.

In addition to field visits, insurance companies also use claims adjusters to conduct "paper reviews" of claims. These adjusters work in the office and review the claims documents and conduct telephone interviews to determine whether claims should be paid. These positions are commonly referred to as in- house claims adjusters."

Many claims adjusters are independent and are contracted by the insurance company to provide assessment services.

Key job requirements for most insurance claims ajduster jobs include:

  • Extensive travel. Travel is required for field claims adjusters positions. Claims adjusters are often assigned to evaluate the claims made within a certain geographic territory.
  • Extended hours. Claims adjusters must often visit the scene of an accident or natural disaster at a moment's notice. For evaluation purposes, it is important for an adjuster in many instances to view the damage when it first occurred. Claims adjusters typically work long days, nights, and weekends.
  • Investigatory skills. Claims adjusters have to consider all facts and circumstances in evaluating whether a policyholder should be paid on a claim. This requires an attention to detail and a drive to uncover a just outcome.
  • Some states require adjusters to be licensed.
  • Ability to handle high-stress situations. Often, claims adjusters must interact with people who have suffered from a traumatic experience. They should remain empathetic, calm, and fair in their dealings.
  • Outstanding communication skills. Claims adjusters have a high degree of interaction with clients, first responders, and community members to elicit the information needed to evaluate a claim properly. They must communicate clearly and articulately.
  • Although a bachelor's degree is not required, most employers prefer it. A concentration in criminal justice or forensic evidence is also a plus given the investigatory aspects of the job.

The median salary for entry-level claims adjusters is slightly more than $40,000. Experienced claims adjusters average in excess of $60,000, depending upon the area of specialty.

Actuary

Insurance companies place a very high value on their actuarial staff. Actuaries make statistical, financial, and mathematical calculations to assess risk. Using these calculations, actuaries determine the probability of future payments of insurance claims. Premium rates are set based on the assessment of the risk.

In the context of property or homeowner's insurance, actuaries study the frequency of fires, tornadoes, hurricanes, floods, and theft in particular geographic regions. They record damages caused by these incidents and project the associated financial impact. They then use the data to estimate the probability of the event occurring again. Based on all of this information, they determine what premium the insurance company should charge customers in exchange for accepting the risk and providing protection.

Actuaries constantly balance profitability with competitive pressures. Premiums have to be high enough so as to enable the insurance company to cover potential claims and other expenses. If the premiums are set too high, however, business will be lost.

Actuarial careers are best suited for individuals with the following characteristics:

  • Outstanding math and financial skills. Mathematical skills, statistical analysis training, and a high degree of business acumen are a must for those pursuing insurance careers as actuaries.
  • Highly analytical. Actuaries must have patience and the ability to study raw data and statistical information without being distracted.
  • Negotiation skills. Actuaries receive pressure from all sides of the business. Sales departments typically want products priced as competitively as possible. Management drives for profitability. Often the actuary must negotiate between these conflicting business interests.
  • Heightened sensitivity to client confidentiality. Actuaries often consult with underwriters to determine the rates a customer should pay. In these circumstances, the actuary gains access to highly personal medical and financial information about applicants. It is their duty to keep that information confidential.
  • Enjoys working in an office environment. Actuaries generally do not have direct client contact.
  • Most insurance companies require a bachelor's degree or insurance-related experience before sponsoring an employee through the actuarial certification process described below.
  • Advancement is typically based on the ability to pass actuarial exams, the profitability of the products developed, and job performance.

The road to becoming an actuary is quite rigorous. It is a lengthy process and involves a series of exams. Most actuaries have a bachelor's degree in mathematics, statistics, actuarial science, or business. Over one hundred colleges offer actuarial science programs. Many graduates seek employment in insurance while simultaneously going through the actuarial certification process.

There are several actuarial societies or associations; two are most widely recognized in the insurance industry. The Society of Actuaries certifies actuaries in life insurance, retirement, health benefits, financial, and investments. The Casualty Actuarial Society certifies candidates in the fields of automobile, homeowner's, medical malpractice, workers compensation, and personal injury liability. In addition to successful completion of exams, these societies require actuaries to complete continuing education courses.

According to a National Association of Colleges and Employers report in July 2009, new actuarial science graduates earned an average of $56,320 annually.

The Bureau of Labor Statistics sites the average salary for actuaries at $84,810. The top 10 percent of actuaries earn in excess of $160,000 per year.

Nursing and Health Professional Careers in Insurance

The insurance industry offers a variety of opportunities for nursing and health professionals. Nurses perform a critical role in the insurance industry. They help companies control costs, which ultimately makes insurance more affordable. In addition, they serve as a valuable resource to clients.

One of the hottest insurance careers for nurses is in the health insurance arena. With health care expenses skyrocketing, insurance companies and health maintenance organizations use nurses to uphold a standard of care while containing costs. Nurse case managers consult with management to determine appropriate coverage levels on individual claims. Nursing and health professionals also develop materials to educate clients about healthy lifestyles and disease prevention. In addition, nursing staff will discuss symptoms and treatment plans with patients who seek referrals.

Health insurance companies are not the only carriers who hire nurses. Life insurance, long term care, and disability insurance carriers do as well. Nurses for these companies work in new business, underwriting, claims, and customer service departments.

From a new business perspective, nurses and health care professionals aid in the application process. For many life insurance policies, applicants must submit blood and urine samples. Samples are collected and processed by nurses who are either employed by the company or independently serve the insurance community.

Nurses also help underwriters determine risk by reviewing the medical histories provided in individual insurance applications. Nurses' insights help underwriters determine the rates to assign in particular cases.

Nurses also consult on claims made in disability and long-term care cases. Their insights are critical to determine the extent of injuries, appropriateness of treatment, and reasonableness of claims.

In long-term care insurance companies, nurses help clients create care plans consistent with their coverage.

When employee benefits programs use managed care, employees call into customer service prior to being admitted to the hospital to determine the extent of insurance coverage. Nurses generally staff these customer service centers. The employee can discuss his or her situation with a knowledgeable professional to determine the appropriate course of action.

In addition to a solid medical background, nurses and medical professionals in insurance settings are expected to have the following characteristics:

  • Attention to detail. Many nurse and medical professional positions in insurance involve review of paperwork. Individuals holding these positions must be able to maintain focus on the paperwork and spot details that might otherwise go unnoticed.
  • Willingness to work in an office environment. Most nursing jobs in insurance are desk jobs with little travel opportunities.
  • Heightened sensitivity to client confidentiality. Nurses often consult with underwriters and claims specialists on particular cases. In these circumstances, the nurse gains access to highly personal medical and financial information about applicants. It is their duty to keep that information confidential.

Pay for nursing jobs in insurance varies from position type to industry. For the most part, the salaries are competitive to those positions in hospital settings. For example, in a typical health insurance company, nurse case managers earn an average of $63,723 a year, medical case managers earn on the average of $60,812, and medical records coders earn an average of $36,677.

Compliance Careers

There is a vast and growing demand for compliance professionals in business insurance. A compliance professional is someone who determines whether the regulations and business policies are adhered to throughout the company. The position requires setting standards that are consistent with regulatory guidelines and evaluating the day-to-day transaction of operations to ensure those standards are met.

In the health insurance realm, for example, compliance professionals are responsible for evaluating denied or rejected health insurance claims. They also work with management to establish customer grievance and compliant procedures.

Compliance consultants work in tandem with legal counsel to review the latest legislation and regulation and determine its relative impact on products and processes. In the absence of regulatory guidance, the compliance professionals formulate policies for their own firms. For example, a significant issue facing the industry is the use of social media in insurance sales and marketing practices. Compliance professionals and in-house lawyers are setting policies that will be adjusted as legislations and regulations are enacted to address the issue.

Compliance professionals are employed throughout the industry. Carriers have entire compliance units, and sometimes work with outside independent compliance consultants. Compliance professionals are also critical in the brokerage and agency level as well.

Someone who wishes to pursue an insurance career as a compliance professional should posses the following skills:

  • Educational background. Most employers will require compliance professionals to have a bachelor's degree in finance, accounting, law, internal auditing, or insurance. Many insurance carriers offer in- house training for entry-level compliance consultants, however, a certain academic aptitude will be expected. In addition, internships are often extended to students who are interested in pursuing careers upon graduation.
  • Data analysis. Compliance professionals spend much of their day reading, reviewing, and interpreting data.
  • Outstanding oral and written communication skills. Compliance consultants must communicate clearly and articulate how a process or transaction most be performed to meet requirements. In many instances, the compliance consultant is the one who establishes those requirements; so the clearer they are, the more likely they will be followed.
  • Sound judgment. There is often ambiguity on how a regulation or legislation impacts a certain business procedure. There may also be ambiguity in the documentation of a process or transaction. Compliance professionals must use sound judgment in making their decisions.
  • Integrity. Compliance professionals must uphold the highest degree of ethical standards and ensure that others do as well.

According to Employment Crossing, entry-level compliance professionals earn an average salary of $39,773 annually. Experienced compliance professionals can earn approximately $56,621 a year. Compliance experts with master's degrees or law degrees can earn in excess of $100,000 a year.

Last Updated: 05/21/2014

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