Unlocking Opportunities: Navigating Diverse Career Paths in the Reinsurance Industry
The sinking of the Titanic in the Atlantic, the attacks on the Twin Towers in America, and the carnage caused by the Tohoku Tsunami in Japan — these are just a few examples that brought about some unpredictable losses as well as irreversible damages and left the rest of the world in a state of shock. But there is something common between these events without which it would have been so difficult even to compensate for a small percentage of the loss amount in the aftermath.
So what is that common factor? It is called Reinsurance.
In the following sections, I will help you navigate through what ‘Reinsurance’ is and what are some of the amazing work opportunities you can explore within this industry.
Reinsurance remains an unfamiliar word to many newbies in the job market.
Now most of us would have already heard of Insurance terms like Life Insurance, Medical Insurance, Motor Insurance, etc but Reinsurance which is primarily about Non-Life Insurance is a huge industry in itself and isn’t often mentioned like its aforementioned distant cousins.
First, let’s understand the word ‘Reinsurance’ in layman’s terms before I shed some more light on this industry.
Reinsurance is nothing but ‘the insurance of insurance’, where one or more insurance companies agree to compensate the risk, which can be a partial or whole coverage of the risk, for the policy issued by another one or more insurance companies.
To put it in simple terms, you would have an insurance firm A that insures the risk of a client. Now, this risk is further shared with say two insurance companies namely B and C. In this case, B and C are nothing but Reinsurers or Reinsurance companies.
The whole process of reinsurance from calculating a risk, formulating and setting up risk coverage policies as well as doing the accounting and taxation work involved in it is truly vast.
This brings us to the various work opportunities one would come across in the Reinsurance industry.
Job Opportunities in Reinsurance
Reinsurers have their operations running in different countries and also there are Reinsurance Broking firms that are involved in assisting the clients as well as the Reinsurance companies wherein they provide end-to-end services.
I will therefore be speaking on a few core teams involved in providing these services.
Starting with the team of Actuaries — There remains a huge requirement of people who have completed their certification in different levels of Actuarial Science in the Insurance industry.
These professionals who are referred to as Actuaries are involved in some serious mathematical calculations concerning analyzing the financial risk as well as calculating the premium amount for any given policy. It is a well-known fact that Actuaries are paid mind-blowing packages depending on the organizations they are employed with.
This is followed by the team of Catastrophe Modelling Analysts wherein you can be from a Mathematics and Statistics or Physics background. This team is involved in a process of using computer-assisted calculations to estimate the losses that might take place due to a catastrophic event such as an earthquake or a tsunami etc. CAT Analysts as they are called, work closely with the team of Actuaries team on almost every project.
So if you are someone with a flair for Maths and Stats and have a Bachelor's or Master's in the same, you can be the perfect candidate for this team. Also, if you have specialized in Areas like Environmental Science related specialization in Wind, Water, etc, this team would be requiring your expertise. The compensation according to your specialization as well as the position offered can be quite lucrative.
Data Science and Data Analytics are the latest cousins to the above-mentioned careers. With Data taking every industry by storm (for the good of course), Reinsurance couldn’t be an exception.
Insurance companies would eventually depend on Analytics software, wherein large data repositories would help Actuaries to make faster forecasts for the business. And here comes the best part about careers in Data. If you love a bit of coding and you don’t hate Math and Stats, you could just pursue a part-time or online bootcamp in Data Science or Data Analytics (Ed-Tech platforms like Coursera and Data Camp are offering affordable and self-pace learning programs in Data which are approved by top companies).
As you pursue the course, you could simultaneously build sample Data models for your portfolio related to insurance (use ChatGPT to get some ideas on this) and showcase it on platforms like LinkedIn or Twitter or even on your blog. This will help grab the attention of the hiring managers and founders and you might end up working with some top Reinsurance firms as a Data Analyst or Data Scientist.
Apart from these tech-bound roles, some teams assist in risk management wherein the organizations require people who are CFA or FRM certified. An MBA in Finance is also a preferred option for this role. I will be sharing links for all these education qualifications below, so do check them out. Again, the salary packages offered for this role are quite lucrative.
When we talk of anything related to Finance, the term Taxation remains inevitable. So, if you are a Chartered Accountant or say a Certified Public Accountant, there is a dedicated team that caters to this specialization wherein they require your expertise and services. Needless to say, the pay package per the current industry standards for this team is one of the best as you cater to multiple Reinsurance clients.
The other teams that play an equally important role in the Reinsurance firms, as well as Reinsurance Broking firms, are the Accounting and technical teams that take care of one of the most important objectives — which is the settlement of the Insurance claims as well as timely payment of premiums for a said reinsurance policy. As such there are no specialization courses that one needs to pursue to apply for jobs in these teams. However, if you take a keen interest in accounting and are curious to learn more about the Insurance and Reinsurance markets these teams can be a great start for a serious career progression.
The salary package offered in these teams when compared might be a little less than what one would be offered in Actuaries, CAT Modelling, Risk Management, and Taxation teams but depending upon what your goals are, you can scale up by building more skills required by getting certified in courses related to specific areas in reinsurance. As the adage goes, the more skills, the better the moolah!
Freelancing Opportunities in Reinsurance
So now let’s come to the kind of services you can offer in the Reinsurance Industry not as an employee with the Reinsurance firms but as a freelancer or as an independent contractor.
Every Reinsurance firm would have their company newsletters to be published and for this, they need not one but many content writers. Also, since this content needs to be published in more than one language, they would be requiring people who have a good flair in both native and foreign languages depending upon the desired target audience reading this content. Since this is some serious technical writing and translation, there is no doubt that you will be compensated well for the services you offer.
Also if you are someone running a Consulting or an Auditing firm, your services will be required as an external auditor or as a Consultant by these Reinsurance firms.
If you have specialized in subjects related to Environmental Science or Mathematics and Statistics and you prefer working freelance, there would be requirements wherein you work on specific projects on a contractual basis with Reinsurance firms.
Internship in Reinsurance
You could also be a B-school student and get ample internship opportunities with a Reinsurer or a Reinsurance broking company to get acquainted with the many aspects of this industry. This can be a great start in understanding the operational aspects.
Thus, it is evident that Reinsurance is a promising job market and will be able to offer a plethora of work and earning opportunities for everyone who has the necessary skills.
Links for some of the courses mentioned in the blog:
https://bit.ly/3dRIyKI (for FRM certification)
https://bit.ly/2Utbl1t (for CFA certification)
https://bit.ly/3hIBkdn (for Actuarial Science)