As we continue to see volatility in global markets, people are looking for safe options to protect what they have. But if anything happened to you, how do you secure your income or your mortgage payments? The easy answer is life insurance – one of the few financial products that increased its sales throughout the GFC, and by a lot, not a little.

But enough about the product; what about the professionals who appraise and price the medical risk? Insurance firms need life underwriters who can calculate whether risk needs to be loaded (the premium increased for present medical conditions) or exempted (too great a risk to cover) and whether an applicant’s financial circumstances warrant the level of cover applied for.

Why so few?

The pool of underwriters with the necessary medical and financial assessment skills is not large in Australia. The main reason for the talent shortage is that unfortunately people don’t leave university saying “I’m going to be a life underwriter”. It is one of those traditional areas of business that people fall into rather than take a planned path towards, unless someone they know is advising them on their career.

It also takes a long time to get to the top, and in underwriting experience is just as important as technical skills, so there are probably better sectors out there if you want to get rich quickly. Moreover, let’s be honest, this is morbidity and mortality we’re talking about – underwriting is hardly a “sexy” industry that you’ll want to talk to friends about at the weekend.

But if you scratch the surface, it’s a very diverse, influential role. Underwriters need to have strong relationship skills for dealing with both financial advisers and business develop managers, ensuring all parties are happy. They must broker deals that keep the insurer smiling in terms of making money by covering the individual and charging a premium for it. On the other hand, they can’t leave the insurer staring at the abyss of a financial black hole that may come back to bite it in a few years, potentially costing it millions. 

Plot your underwriting path

The career path of many senior underwriters has traditionally started in administration. People with administration expertise have been trained to be underwriters, taking their soft skills into the sector and then developing their technical knowledge. Increasingly, life professionals are realising what it takes to become an underwriter and are focussing on achieving this goal in the longer term. Claims assessors who study underwriting courses at their own expense are an impressive example of this.

Demand for underwriters will be strong in 2012 and the talent wars will continue. But with more and more people moving firms, job longevity and retention are becoming concerns for employers.

A global career

Firms are targeting foreign talent. Underwriters from the UK, Ireland, continental Europe, South Africa, the US and Canada – all markets with similar risk products, some of which are more advanced in their scale – have been moving to Australia and New Zealand recently with near seamless transition.

These professionals can make the transition to senior positions quite successfully, with relocation and visas available based on individual circumstances. Salary increases of up to 20 per cent are possible. For local candidates, 10 per cent is more common, if they are already well paid in global market terms, although role-specific skills that are in high demand (such as e-engine adviser-facing underwriters) can generate rises of 20 per cent.

Shane Watson, manager, life/risk division, Porterallen