Last Updated: January 18, 2023

Insurance Industry Layoffs: What’s Next for Insurance Agents? 

In the current economic climate, layoff (or reduction in force) has become increasingly common. Corporations have been responding with hiring freezes and slowdowns – a telling sign for what some are anticipating to be an extended recession. It is estimated that over 600,000 workers have lost their jobs since the start of the pandemic, with the US Bureau of Labor Statistics reporting that the jobless rate peaked at 14.7% in April 2020—the highest it had been since the Great Depression. According to a Crunchbase News tally, more than 91,000 workers in the US tech sector have been laid off in mass job cuts in 2023.

The magnitude of the layoffs has impacted the lives of millions of Americans. In July 2022 alone, Tesla announced major layoffs in its autopilot division, and Apple cut down on nearly 100 contracted recruiters as part of their austerity measures. In the tech industry, several major companies have announced significant layoffs in 2022, including Twitter which reduced its workforce by 50% under the guidance of CEO Elon Musk.  

Similarly, Meta laid off over 11,000 employees in early November 2022, reducing its workforce by 13%. The layoffs have had a far-reaching impact on people from all walks of life and industries. From the insurance industry to retail stores, companies across the country are cutting back on staff and costs to stay afloat during these trying times.  

Unfortunately, these developments have affected the insurance industry as well. The insurance industry is one of the largest employers in the United States, and the number of layoffs within the insurance sector has surged significantly. For example, The Hartford Financial Services Group slashed 1,500 jobs in 2020. Similarly, Liberty Mutual Insurance laid off 400 workers in February 2021 due to restructuring efforts.    

Insurance Layoffs 2023

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Insurance Industry: Major Layoffs in 2022  

In 2022, insurance companies worldwide saw a significant decrease in their workforce, with many insurance agencies having to downsize their workforce by over 25%. This had a significant impact on insurance companies across the globe, resulting in reduced services, increased premiums, and decreased quality of customer service.   

The major layoffs have meant that insurance agencies have had to focus on cost-cutting strategies to stay competitive within the insurance market. The insurance industry is one of the most heavily-regulated industries, and insurance companies must adhere to strict legal requirements. Insurance companies must be particularly mindful of their workforce costs to comply with industry regulations.   

With these major changes, insurance companies have had to adjust their business strategies to remain viable within the insurance industry. These changes have affected insurance customers from all walks of life, resulting in higher insurance premiums and reduced coverage for policyholders. In addition, insurance agencies are now more concerned about data protection and cybersecurity than ever before due to increased scrutiny from regulators and the public.  

Some of the major insurance companies’ layoffs in 2022   

In October 2022, Kemper Corporation announced layoffs of 339 employees nationwide – with 39 based in Alabama. The insurance company attributed the move to pandemic-induced economic pressures, such as sustained inflationary effects.  

Columbus-based auto insurer Root laid off about 20% of its workforce in January 2022, blaming the pandemic for spiraling costs. The company said one of the biggest reasons behind the layoffs is to improve the claims and sales departments.  

Blue Shield Insurance of California plans to lay off 373 employees across the state by Jan. 25, 2023. The bulk of the layoffs are occurring in the Sacramento region but also include cuts at the insurer’s Oakland headquarters and elsewhere in the state.  

Humana is laying off 157 employees at its SeniorBridge facility in Jupiter, Fla., as it prepares to close most of its SeniorBridge locations nationwide. The layoffs include 149 caregivers, six field nurses, one sales executive, and one care supervisor.  

Bright Health experienced a turbulent 2022, leading to layoffs in March and November of this year. The healthcare provider brought their workforce from 3,000 down to 2,850 due to ending much of their individual and group insurance business.  

In August, GoHealth—an online insurance marketplace—experienced a significant downturn when CEO Vijay Kotte announced the layoff of many employees and support staff. Chicago Tribune reports that this upheaval affected around 800 individuals across their workforce.

With book roll, agents can also spend less time handling their clients and more of it finding the right clients. This allows them to focus on other business opportunities. 

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Challenges to Insurance Agents and Agencies 

These are just some of the many layoffs in 2022, leaving thousands of insurance workers out of a job. With such a large reduction in personnel and resources, it can be difficult for insurance agencies to stay afloat and continue providing exceptional customer service.

Increased workloads due to reduced staffing levels

With fewer agents to handle customer inquiries, process paperwork, and offer support, insurance agents in the workforce now have to do more with less. This puts a strain on both the morale of existing staff and their ability to complete tasks efficiently.  

Decreased resources

With budgets already tightened due to economic pressures, insurance agencies no longer have access to the same resources they were able to rely on in the past. This means that agents must be creative when finding solutions for their customers’ needs and may need help sourcing the materials they need to do their job.  

Potential loss of customers

In a highly competitive and uncertain market, customers are more likely to switch providers if they feel their needs need to be met. Agents may find themselves losing out on business due to their lack of ability to provide the same level of service they could before.  

Reduced training opportunities

Without the same access to resources, insurance agents may find that their training and development opportunities are limited and can’t keep up with industry changes. This can hinder their ability to stay on top of the latest technologies and trends, negatively impacting their performance and future success.  

Increased stress levels

With all these challenges and insurance industry-wide layoffs, insurance agents face higher stress and burnout. Agents must be mindful of their mental health and take the necessary steps to stay healthy to continue providing excellent customer service.  

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How can insurance agents scale up their business?  

If you’re an insurance agent laid off recently due to significant layoffs in the insurance industry, it can be hard to know your next steps. Despite these challenges that come with mass layoffs in the insurance industry, there are solutions for agents who want to stay ahead of the curve and continue providing quality customer service.  

Become an independent insurance agent

One way insurance agents can continue providing quality services is to become independent agents. This allows them to remain flexible and explore different options tailored to their customers’ needs. Becoming an independent insurance agent also gives them more control over their career and the ability to set their rates.  

Insurance marketing

Insurance agents must stay ahead of the competition. Agents should focus on developing marketing strategies to attract new customers and maintain a high retention rate. Utilizing the latest technology and trends can help agents stay competitive and reach more customers.  

Customer service

With fewer resources, customer service needs to be the top priority. Agents must focus on providing an exceptional customer experience to maintain their existing client base and gain new ones. Insurance agents can use platforms like Agency Height to automate repeatable workflows and offer personalized experiences for customers.  

Training

Insurance agents must stay up to date with industry changes and regulations. They should take advantage of online learning platforms to keep up with the latest trends and technologies. This will help ensure they are compliant and informed and can continue providing quality service to their customers.  

Offer virtual services

Platforms like Agency Height allow insurance agents to connect with customers virtually. Agents should also utilize live chat or video conferencing platforms to connect with customers. This will enable them to provide a convenient and personalized service without needing an in-person visit.   

Leverage online platforms

Utilizing online platforms such as social media or blogs is an excellent way for agents to increase their visibility and reach more potential customers. Additionally, getting listed on insurance directories is just as beneficial as it helps customers near you reach out to you. Agents should ensure they are taking advantage of all these digital outlets to stay competitive and continue providing quality services despite the effects of mass layoffs in the insurance industry.  

At Agency Height, we understand the struggles of mass layoffs in the insurance industry. We have made it our mission to provide support and resources for agents who may have been affected by these layoffs and get them back on their feet.  

We understand how difficult job searching can be after a layoff. Agency Height is committed to helping you return to successful employment as quickly as possible. With our extensive network of industry contacts and expertise, we are confident that you will be able to find the right customers in no time.  

Don’t let a layoff stand in your way. Contact us today and begin your journey toward a new career with Agency Height!

Will there be job layoffs in 2023?

In 2023, one in three businesses anticipate laying off 30% or more of their personnel, according to a December survey of 1,000 business executives by Resume Builder. Industries of all sizes have been affected by the reductions thus far.

Are insurance and tech layoffs going to continue?

This is due to the fact that those businesses that are unable to expand into their inflated new values and who are unable to raise further money without running the danger of a down round may have to reduce payroll, which is frequently their single-largest expense, in order to extend their runway.

What companies are laying off workers in 2023?

After conducting a significant round of layoffs last year that resulted in more than 125,000 job losses, San Francisco-based tech giant Salesforce announced plans to reduce 10% of its workforce on Wednesday. As recessionary fears rise, this makes Salesforce the first American company to conduct significant layoffs this year.

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Agency Height is an online directory and publication platform. We’re dedicated to helping people find the right insurance by bridging the gap between agents and insureds. Our publications are the go-to guide for all things insurance. From blogs and articles that help professionals grow their business to data analysis on trends in our industry, you will surely find what you’re looking for! 

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