7 Reasons to Major in Risk Management and Insurance
At Kansas State University in 1993, there were no risk management and insurance programs. I cannot recall a single friend or classmate who went to work at an insurance company. Like many risk and insurance professionals from my generation and prior, we typically fell into the business or had family members working in the industry.
This is no longer the case as there are numerous risk management and insurance programs nationwide who prepare thousands of students to enter the profession today.
I would like to share seven compelling reasons to major in risk management and insurance. I have the fortune of having a niece and nephew who are both seniors in high school who are choosing schools and majors as we speak. Their perspectives on the core values and determining factors for deciding college majors have been invaluable in writing this article.
New and Different Responsibilities
As a risk management professional in the insurance industry for the past 12 years, I can say that this has been the most interesting job I have ever held and I’ve worked in manufacturing, banking and financial services before joining the insurance industry.
A major in risk management and insurance will provide you foundation to build your technical skill set and growth as a professional
In my role within enterprise risk management, every day brings new and different priorities and responsibilities. In any given day, I may work on three to five different issues such as emerging risks, governance, controls, exposure management or capital allocation.
The world is constantly changing. New risks and opportunities are constantly arising as a result of changing regulatory, political, environment, and social changes. As a result, new insurance products and coverages are needed to meet the demand for protection of consumers and businesses. Internally, new processes and controls are needed to effectively introduce and manage those new products and coverages.
There is typically no right or wrong answer when introducing new products and coverages. It may be based on the market demand but also the company’s risk appetite and creativity. As a risk and insurance professional, you will have the opportunity to apply your critical thinking skills to numerous initiatives.
Stable Industry with Strong Growth Prospects
The insurance industry weathers economic ups and downs better than most industries, such as banking construction or consulting, for example. While the economy no doubt has an impact on the insurance industry, it should be noted that consumers and business still continue to need insurance.
Additionally, the industry is facing a significant loss of talent in the near future. A McKinsey & Co. study suggests that 25 percent of insurance industry professionals will retire by 2018, which will provide opportunities for the next generation of graduates to contribute in meaningful ways to the industry.
Careers in risk management and insurance can be financially rewarding. Some career paths, such as in Actuarial Science are some of the highest paid and have the highest demand in the U.S. In addition, an emphasis in risk management and insurance can provide specific skills as compared to a general business major. Those specific skills can lead to higher salaries.
Clear Career Paths and Opportunities for Advancement
Majoring in risk management and insurance can lead to numerous opportunities and career paths within the insurance industry as well as other industries. Examples include careers as actuaries, risk managers, underwriters, financial and risk analytics, compliance and internal audit to name a few.
The insurance industry requires specific skills and knowledge. That industry specific knowledge sets up barriers to entry where it can be extremely difficult for someone coming in from an entirely different industry to succeed as quickly as an experienced insurance professional. Acquiring that specific knowledge, coupled with the upcoming talent shortage provides fertile opportunities for growth and advancement.
Risk management and insurance majors are usually part of a University’s business program and therefore require additional business classes similar to those required by a business major. Therefore, if you choose not to pursue a career in the insurance industry, you will have the core business knowledge to pursue careers in other industries. Think of a risk management and insurance degree as a focused business degree.
Opportunities to Help Others
An insurance policy is just a piece of paper representing a “promise” to be there when policyholders need them the most. It is when a policyholder makes a claim that they will learn whether they have selected a strong insurance company or not. That peace of mind promise that insurance companies provide is taken very seriously. You will have opportunities to help those in times of need.
Good corporate citizenship is a core value of many in the industry. Many companies provide numerous opportunities to volunteer in local and national causes. A 2015 McKinsey & Co study found that the U.S. property-casualty insurance industry contributed $575 million to charity in 2014, up about 15 percent from 2011.
As mentioned, the insurance industry is technical in nature and therefore provides highly competitive compensation and benefits in an effort to attract and retain talented employees with the appropriate skills. A major in risk management and insurance will provide you foundation to build your technical skillset and growth as a professional.
Many insurance companies are large multi-national corporations with offices around the world. If you enjoy travel, careers in risk management and insurance may be your ticket to experience new cities around the globe.
A career in risk management and insurance can be very challenging, rewarding, and constantly evolving.