When the Bayeux Tapestry came to England this summer for the first time in nearly 1,000 years it was covered under a government scheme for the value of £800mn.
The huge sum sparked debate in the media, but also highlights one of the key elements of a career in insurance — working out the risk that something might go wrong, and how much it would cost if it did.
Essentially, all insurance works in much the same way. Customers are invited to pay a relatively small amount of money to an insurer who will pay out a significantly larger amount if something goes wrong.
The insurance industry spans a wide range of professions, says Nathan Adams, chief people officer at Lloyd’s, the global insurance marketplace.
To price an insurance policy, someone called an underwriter has to assess the probability that, for example, a house might be flooded or a satellite hit debris in space. They also have to assess the likely cost of that damage. Then a price for the policy can be prepared, which also takes into account the number of customers taking out the insurance.
Another branch of the industry deals with claims, deciding, for example, who should be blamed for a car collision and assessing the extent of the damage.
Insurance professionals can also work in reinsurance, which is when insurers themselves get insurance on the policies they have promised to pay out on.
Actuaries use statistical modelling, financial theory and probability to forecast future risks, design policies and ensure companies have enough money available to pay out on future claims.
Brokers advise clients on risk exposures, negotiate terms with underwriters, who decide whether an insurer should take on the risk, and structure customised coverage solutions.
“Many people are surprised by just how varied a career in insurance can be,” says Adams.
The industry recruits from a range of academic backgrounds. Adams says qualities such as curiosity, adaptability and life-long learning matter more than specific degrees or qualifications.
“Because risk touches every part of society, the industry needs people with a wide range of academic backgrounds, experiences and perspectives,” he says.
Caroline Wagstaff, chief executive of the London Market Group, the official trade body that represents London insurance businesses, says many people enter on apprenticeships and other school-leaver programmes without the need for multiple internships or successions of short-term contracts.
A number of global insurers, reinsurance firms and brokerage houses offer structured graduate schemes and apprenticeships that provide rotational exposure across underwriting, claims, and risk management, Wagstaff says.
Pursuing recognised professional qualifications — such as those offered by the Chartered Insurance Institute or the Institute of Risk Management in London — is common at different stages of a career in insurance and can often be done alongside the job, according to Kerry Simmons, chief marketing officer at Bright Network, an early-career networking platform.
Someone who likes digging into information and working out what has happened might be suited to working in insurance investigations teams, she says, whereas someone who enjoys analysing risk and making decisions based on evidence might be drawn to underwriting or actuarial work.
Simmons also points to how AI is changing the way some of these roles are carried out. “Understanding what you’re good at and what you enjoy doing is a starting point for working out which part of the industry might suit you,” she adds.
As for whether an outstanding talent in mathematics or a statistics degree is essential, Wagstaff says it depends on the role.
Actuarial work focuses on data and analysis and might require an applied sciences degree and a strong foundation in a programming language.
Other jobs, especially in broking, involve more interaction with clients and customers.
“The ability to build relationships and work closely with a global set of clients is highly sought after in this industry,” Wagstaff says.
A benefit to the industry is that the profession touches on everything and has a real-world impact.
“From rock stars to space rockets and from typhoons to terrorism, [insurance] offers protections to people and businesses when they most need them,” she says.
The UK remains the most important market for specialist commercial insurance. While the country is not the biggest market in terms of volume — the US has the most domestic consumers — it is the global leader in certain niches.
Another perk of the industry is work-life balance, Wagstaff says.
“As a whole the sector has a strong reputation for being sticky,” Wagstaff adds. “Once you start working in insurance, people often end up staying for long stretches of their careers.”
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As for pay, starting salaries tend to be more modest than some other areas of finance, but there is potential for substantial bonuses and strong career progression, says Chris Rea, head of strategic relationships and early-careers expert for the UK’s graduate-job site Prospects.
Trainee underwriters in the UK can start on £24,000 to £35,000, according to Prospects, rising to between £35,000 and £65,000 once qualified and more than £100,000 in senior roles.
There is also competition for people with strong digital skills, particularly in areas such as data analytics and AI, Rea says.
“Don’t be put off by outdated perceptions of insurance, the sector is dynamic with roles that demand diverse skills and the industry is actively looking for new talent,” he says.