Graduate Jobs in Insurance

This page is about graduate jobs in Insurance. Insurance is one of the UK's most important service industries and one of the UK's largest invisible export earners, involving some of the most substantial funds in the world; over the last five years it has generated half of Britain's invisible earnings.

Within the Insurance industry there are five main business sectors: pensions, insurance, life assurance, investment and actuarial work. Over 300,000 people are employed in the insurance sector, either in insurance companies, of which there are several hundred, or in insurance broking, arranging cover with the insurance companies.

How Insurance Works

Insurance operates by a large group of people paying fixed amounts of money, known as premiums into a fund. Providing a claim is legitimate, money is then taken from these funds when compensation for a loss or accident is required. Therefore insurance products protect individuals and institutions in the event of these circumstances.

There are seven main areas of insurance:

• Aviation
• Liability
• Marine
• Motor
• Property
• Life
• and Pensions

There are many different areas of specialism in the insurance world but all fall within two principle business factors: life and general insurance. Life is concerned with insuring people against premature death or permanent injury, also providing for the financial needs of individuals through savings and in retirement. Pensions and long term investments contracts fall within the life category. General insurance provides protection against damage to property, personal injury and liabilities - everything from motor and household insurance to risk protection for high cost installations such as oil risks or satellites.

A third major facet of the industry is reinsurance, whereby insurers spread their risk by taking on their own insurance against claims. This spreading of risks accounts for a large proportion of the business which comes into the UK every year and represents a growing area of insurance activity.

The establishment of the single European markets means that UK insurers are having to cope with new business conditions, to ensure that they increase their share of the European business and respond effectively to the increased competition from overseas insurers within the UK.

In recent years there has been a large expansion in the services provided by insurance companies. The majority of the larger insurers now offer services ranging from unit trusts to mortgages, and this is a direct result of the increasing diversification of all the major institutions within the financial world. Insurance companies, building societies and banks increasingly find themselves battling for the same financial services markets. Within a decade it is likely there will be very few companies or brokers left dealing solely in insurance. Coupled with the increasing globalisation of the insurance market, there has been a marked trend in recent years towards the merging of rival companies in order to survive.

A further development is the increased provision of online insurance. At the moment, this is mainly concerned with personal insurance, since this is the easiest area to market and operate. However, as technology develops, new online services will be increasingly available for many areas of commercial insurance.

Careers

Insurance services cover a broad number of roles across the whole process of the insurance life cycle from selling policies, administering insurance claims, analysing and calculating risks, setting premiums, fund management and processing claims.

The merging and diversification of the insurance industry, along with advances in new technology, is good news for graduates. Insurance companies require more graduates than ever before and are able to offer a great variety of positions. New trainees may be employed in one of the main areas of insurance, or in developing sectors such as information technology and finance. Most positions allow employees to follow professional insurance exams leading to associate membership of the Chartered Insurance Institute (CII).

Generally speaking it is the very large organisations that dominate the insurance markets although there are the smaller actuarial consultancies or insurance brokers that can offer graduate careers. Many different financial services providers, such as banks and retail organisations, now sell insurance. These brokers are intermediaries who go to an insurance marker on your behalf to negotiate the level of cover you require. The market provides an arena for the broker to negotiate the best deal with an insurance company. However, particularly in personal insurance, customers can also deal with insurance companies direct without using an intermediary.

Life assurance companies provide a variety of savings and protection services to policyholders. They are very different from general insurance companies that sell insurance policies for you car for example. Rather than selling short-term policies that tend to be renewed every year, life assurance companies sell long-term policies.

Sales are obviously the front end of insurance, dealing with the public usually face-to-face and advising them on the right insurance policy for them. There are also insurance organisations that specialise in providing insurance for companies and these organisations also offer sales positions for graduate entrants. Actuarial positions involve the calculation of the risk the organisation undertakes for the return on investment. This usually involves the use of statistical models to predict risk. Fund management is also the calculation of risk the organisation undertakes for the return on investment however less complex mathematical equations are used in actuarial work but more emphasis is placed on the subjective interpretation of data.

All the different graduate entry positions in insurance are generally segregated from each other. This means that you generally can't move within a company from one role to another, i.e. sales to actuary. As a result each type of graduate entry position will lead to different career paths within an organisation. The main graduate job roles can be divided into two main categories: technical functions and support functions.

Technical Functions

Technical functions in Insurance are:

• Underwriting - analysing risks and setting premiums
• Claims - answering queries and administering claims from call centres
• Insurance broking - analysing your needs and negotiating the best deal with insurance companies
• Actuarial - the number crunching side of the business
• Accounting - ensuring the numbers add up and liabilities are met

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