The insurance industry in the United Kingdom is facing a significant shortage of digital and analytics talent, according to a recent analysis by McKinsey. The study reveals that only three in ten UK insurance employees possess skills in digital and analytics, which is half the proportion found in global technology companies. This shortage of tech talent is hindering the industry's ability to adapt to the digital transformation that is sweeping the insurance sector.
The research also indicates a strong correlation between the availability of digital and analytics talent and company profitability. Insurance companies with a higher proportion of digital talent tend to be more profitable, suggesting that attracting and developing tech talent should be a priority for insurers.
In comparison to other industries and best-in-class technology companies, the UK insurance industry lags behind in terms of tech talent. Only 28 percent of employees in UK insurance companies possess digital and analytics skills, and just 12 percent are in digital and analytics roles. This is in stark contrast to global technology giants, where 56 percent of employees have digital and analytics skills, and 30 percent hold digital and analytics roles.
The most prevalent digital and analytics skills in the UK insurance industry are in the areas of data and analytics, including data science and data analysis, as well as application development skills like programming and front-end and back-end development. However, the study also reveals that digital and analytics employees in the insurance industry have been with their companies for longer periods compared to their counterparts in leading tech companies and digital-focused personal-lines insurers.
To address the talent shortage and ensure they keep pace with the digital transformation, UK insurers need to take immediate action. This involves doubling down on recruiting tech talent and providing training programs for existing employees to develop the necessary skills. It's important for the industry to highlight the exciting opportunities in insurance digital and analytics to refresh its image and attract younger workers who may perceive the industry as less vibrant.