One of the most common topics we find in discussions with CIOs and other senior IT leaders today relates to talent management. There’s a broad recognition that labor markets are fundamentally different than they were in the easily remembered past and that, as a generation, Millennials are fundamentally different from Baby Boomers when they think about both career objectives and the nature of work. Failing to recognize these distinctions can have major implications for carrier IT organizations, keeping in mind the fact that Millennials themselves will represent fully half the US labor force during the next annual budgeting cycle.
We discussed this at length during Novarica’s recent Regional Roundtable event in Columbus. It came up again as a “hot topic” during my keynote presentation at the NAIC Insurance Summit in Kansas City.
This is a great illustration of changing circumstances requiring new and appropriate responses. Doubling down on “the same old thing” has a Groundhog Day feel to it that seems highly unlikely to produce a happy return.
In the same vein, there are fundamental changes taking place in the market that suggest new opportunities for different product sets. Industrial life insurance and products that came later spoke to very real needs at a time when the loss of a wage earner could have disastrous financial implications. That’s less true in a world of multi-wage-earning family units and varied organizing principals for living routine lives. Included in this of course is delayed marriage and child rearing.
If the benefits of yesteryear are less important, but still the primary focus of life insurance carriers, are there other opportunities to leverage technology, extend capabilities, and increase relevance? It certainly seems like an opening.
In a recent study, student debt surfaced as one of the major financial concerns for Millennials. Keeping in mind the fact that this is now our largest living generation, and that the unemployment rate in many geographies for skilled talent is surprisingly low, the creation of products that could address their needs seems particularly timely. There are a range of issues that would need to be addressed, but some employers have already hit on this as a complement to other matched savings vehicles, like DC retirement plans (e.g., 401k, 403b and 457 plans). The same kind of record-keeping and reporting capabilities would seem to be highly leverageable in an adjacent space like this. In fact, Fidelity Investments is already moving into this space, something carriers should also take note of.
On a related note, at least two Tier 1 carriers have combined their retirement services and group insurance businesses into a unified “worksite” offering. It will be interesting to see how this changes product development dynamics for the future. For IT organizations, this could be an opportunity to add new value. It could also be a situation where some “home cooking” could address a very real problem facing many CIOs, a potential win-win if there ever was one.
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