Insurance is one of the ways that businesses and individuals reduce the financial impact of a risk occurring – by paying a premium to an insurance company, the risk is in effect transferred from the client to the insurer, meaning the client can focus on their business or life. The UK insurance market is the third largest in the world.

Without insurance there would be no risk taking. And without any risk taking, there would be no businesses and no innovation. Insurance is what enables the modern world to get on with life.

And it’s everywhere. It’s also big business. In fact, it’s one of the biggest. In terms of careers, the sector offers a truly remarkable range and diversity of opportunities. You can enter specialist career streams or join the profession through a host of highly rated graduate schemes with some of the most prestigious names in finance.

What’s involved?

There are differing types of insurance business, including life and pensions companies, insurers, brokers and claims management. Within companies classified as ‘insurers’, there are the following subdivisions:

The insurance markets

Insurance can be broken down into two types of markets. Although there are differences, the theme is the same: both are concerned with offering financial protection against unforeseen events. You will find similar career opportunities in each market, although the job title, working environment and salary may differ. The key distinctions between the markets are often the type of customer and the sum of money involved.

  • The wholesale market focuses mainly on the London Insurance Market, which comprises the syndicates operating in Lloyd’s of London together with the London offices of a number of UK and international insurance companies. The risks that these companies and syndicates share are generally very large and sometimes unusual and are placed in the market by specialist brokers.
  • The retail market is what most people understand by insurance and comprises the companies that we see advertising on the high street and the internet. It deals with the types of insurance that the general population need for their car, house, travel or pets, and also arranges pensions and life cover.

Types of insurance

There are generally three categories of insurance, which can happen across both or just one of the insurance markets.

  • General insurance provides protection for damage that may happen to our belongings – for example cars, houses, jewellery, or for any harm that may come to us during particular events such as holidays or sports activities. Companies also need insurance against any unforeseen events that could impact upon their business, like a fire in a warehouse or a plane crash, or even a natural disaster. General insurance is dealt with across both the retail and wholesale markets.
  • Life assurance refers to financial cover for individuals in the event of their death or illness, therefore providing financial security for their family. Life and critical illness cover provides security for those who have mortgages. Life insurance occurs mostly in the retail market.
  • Reinsurance is when an insurance company arranges insurance for a risk that they have already insured themselves. The insurance company becomes the ‘insured’, and the reinsurance company is the ‘insurer’. This is a fairly specialist type of insurance, and much of this work takes place in the wholesale market. Reinsurance is normally applied when a company is insuring against very large perils, so that if paying out against the policy is necessary, the risk is shared between a number of companies rather than just falling on one.

Who works in insurance?

Within an insurance firm you will find a team of specialists working together. These teams could include professionals from underwriting, broking, customer services, sales, risk management, catastrophe modelling, compliance, training, actuarial, marketing and administrative roles. Each professional supports the other, ensuring that the risk is managed well and that the customers – whether it be an individual, a business or the government – feel financially secure.

It’s not just arranging and negotiating the insurance that is important though. Risk managers help organisations understand and address all the risks facing their business, including those that can be insured and those that can’t. Loss adjusting and claims management specialists have to manage the situation if the unforeseen event does indeed happen and a loss occurs. They have to use their knowledge and expertise not only to assess the validity of the insurance policy but also to liaise with a wide range of other people – fire brigade, police, lawyers and doctors to gather evidence and support the customer through the process.

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