Signal Iduna is growing against the market trend – shortage of skilled workers as a central challenge

Dortmund is an insurance city and Signal Iduna is one of the big players in the industry. The long-established Dortmund company has held its ground well in the tense markets – in some cases clearly bucking the industry trend. CEO Ulrich Leitermann can come up with positive numbers. However, the biggest challenge is increasingly not what is happening on the market, but the shortage of skilled workers.

Signal Iduna is growing in all areas – sometimes against the market trend

Even if the annual financial statements are not yet available, the key figures are very positive. The Premium income increased to 6.5 billion euros. Signal Iduna has thus gained 2.3 percent, while the market has shrunk by 0.7 percent. The Dortmund insurer has once again outperformed the market: from 2018 to 2022, it grew by around one billion euros.

“But that has nothing to do with the premium adjustment,” said Leitermann. At Signal Iduna, fees increased “only” by 1.6 percent, while industry-wide it went up by three percent. The insurer, with locations in Dortmund and Hamburg, was also able to assert itself in private health insurance. Even if “only” in the four-digit range, Leitermann recorded growth – also against the market trend.

Life insurance and composite insurance (property and casualty insurance) also clearly bucked the upward trend. “It only works because we have a very good sales result,” says the CEO. Signal Iduna records continuous increases.

This will continue in the new year: January 2023 was the best in the company’s history from a sales perspective. “That was very gratifying and not necessarily to be expected,” emphasizes Leitermann, with a view to the numerous crises and economic challenges.

“We have always wished for interest rates to rise, but please not so quickly”

Because the energy crisis, inflation and the capital market turmoil due to rising interest rates will also be reflected in the investment result for 2022. In the capital market in particular, there will be value corrections in the securities area – Leitermann is right with 20 percent less. “We have always wanted interest rates to rise, but please not so quickly,” the CEO makes clear. “In the long term, this is desirable because we have a higher average interest rate in the new investment.”

There are also changes in the attitude of the insured: while people did more for their own insurance protection during the Corona period – including for old-age provision – economic uncertainty plays a much greater role. For example, there is greater reluctance when it comes to life insurance.

Many households do not know what the future will look like financially and how exploding energy costs and other price increases will affect them. Therefore, customers are more cautious about long-term contracts such as life insurance. However, there has been an increase in the protection against risks – for example to protect residential buildings against natural hazards.

Target group concept: trade and craft as focal points

More than two-thirds of deals and transactions are made via so-called “Exclusive Organizations” – i.e. exclusive Signal Iduna agencies. This area continues to grow. Leitermann points out that the trend towards larger and more specialized agencies is continuing. “We do a lot of that in training.”

In addition, Signal Iduna pursues a target group concept: They train the representatives, for example, in certain industries – the focus is on business customer business, including crafts and trade. “So that we can talk as equals. That also bears fruit,” says Leitermann.

The target groups now account for more than 50 percent of new business. “We’re still a long way from the end.” However, for the most part, these sectors are also the ones that are particularly suffering from the exploding energy costs and procurement prices. Many independent bakeries are struggling massively – more and more small businesses are giving up.

“The concern was that 25 percent of the companies would go out of business. It didn’t turn out that bad because there were also solutions for small and medium-sized companies,” says Leitermann, referring to the aid packages and energy costs.

Challenge: Every year 250 employees retire for reasons of age

But just like its commercial customers, Signal Iduna is increasingly struggling with the shortage of skilled workers. There are currently around 2,350 employees at the Dortmund location – 88 of whom are trainees. At the Hamburg location, the Signal Iduna Group has around 3,540 employees (including 71 trainees). Almost 900 of these employees work for the financial subsidiaries Hansainvest, SIAM, SI Bauspar, Donner & Reuschel.

The challenge: In the next ten years, 250 (!) employees will retire each year. However, it will hardly be possible to fully replace these positions through acquisition on the market. There are already an average of 100 vacancies that are advertised.

“This forces even more digitization. It will not be possible to manage the growth with more staff, but only through process optimization,” predicts Ulrich Leitermann. If possible, machines should help with the work – the fewer staff should then be used primarily in the service sector and in service: “It takes people to talk to people.”

Therefore, the competition for employees has also changed significantly in the insurance industry – waiting for applications is a thing of the past: “It is an employee market. One or the other tries to impose their conditions on us or to make demands.”

Insurer wants to become more attractive as an employer – diversity issues are becoming more important

Signal Iduna has been working on applying to potential employees for a long time. There is a wide range of job descriptions and fields of activity in insurance. With a total share of almost 45 percent, insurance and finance clerks and insurance clerks make up the largest proportion of employees. Almost ten percent have an IT background: IT specialists, data processing and information clerks or IT specialists.

Around 4.5 percent originally come from the medical field, be it as a doctor’s assistant or nurse. There are also mathematicians, lawyers, economists and people who have completed their training in various trades.

Therefore, professional recruiters for social networks are also used. Since Signal Iduna pays collective wages, it is mostly not about the money. It is much more about the work and the working conditions. “That’s why we involve the teams early on. That plays a big role,” says Leitermann. This also includes caring for newcomers. So there are breakfasts together with all new hires. “We show interest in them.”

The company not only has the advancement of women in mind, but also created a position that deals only with diversity issues. For Leitermann, this is also a component of the company’s sustainability strategy: “Diversity is seen as a very important issue for the future. We have to do that in the male-dominated insurance industry – so far, too little attention has been paid to it in the industry.”

Home office is an important topic at Signal Iduna

Job interviews and job satisfaction are increasingly about the question of working from home: “Corona has done something to people. They have seen that they can work well from home,” says Leitermann. You could then also travel long distances and save a lot of time. Still, Leitermann is not a fan of the fact that a large part of the workforce works from home permanently. He worries about the corporate culture and the connection to the company.

“How are they going to tie them to a work environment. Experiencing togetherness is part of it, as are creative product solutions. This is only possible together,” says Leitermann. It is particularly important for the trainees to get to know the training company.

In the future, Leitermann wants to increase the proportion of face-to-face work again after all corona restrictions have ended: “35 percent are in the company, 65 percent in the home office – that’s still too much for me. The declared goal is to have up to 60 percent in the office again by spring,” says the CEO. Signal Iduna was one of the first companies to reach a company agreement on working from home with the works council – it provides for the right to work from home for up to two days per week.

Working in the office should become more attractive again

Flexibility is important for the teams. The superiors would have to control this individually. Because there are employees who do not want to work at all from home, while others do so more frequently. Presence in the office must also be balanced in this way.

The insurance company invests a lot to make the office environment more attractive. Height-adjustable desks are just as much a part of this as welcome, community and collaboration zones, healthy catering throughout the day and health offers. While conversations in the tea kitchens used to be frowned upon (“Don’t you have anything to do?”), this is expressly desired in the new “Coffee Points”.

This is intended to improve the sense of community and the bond with the company. However, flexibility is also part of it. Employees can already use Saturday as a working day and then take a day off during the week. This is also part of the process of increasing flexibility.