Re/insurers are paying more for non-executive directors
Every re/insurer uses and needs non-executive directors (NED) – but they are paying more than ever for their services, according to a new report.
NEDs in re/insurers now earn on average almost £100,000 a year or £3,000 per contracted day, an increase of 70% in the past four years, at least in the London Market, according to research by executive search firm Damhurst.
The firm says the increase can partly be explained by inflation and the increase in the number of days contracted. This is due to increased regulatory scrutiny and an additional workload falling upon the NEDs.
It also suggests recruiting greater diversity on boards is costing more, with evidence of more female directors and those from outside the industry. 25% of the respondents were female, which reasonably reflects the average insurance board composition. These were paid on average 9% more than their male counterparts.
Damhurst’s latest Non-Executive Director (NED) Remuneration Report, covering 2022, was last completed in 2018. Damhurst gathered data via an anonymous online survey of relevant insurance market non-executives.
On average, it indicated that re/insurance NEDs were paid £93,500 in 2022, which equates to £2,800 per contracted day. This remuneration was based upon an average of 33 days contracted work. Since the 2018 Damhurst report the average remuneration in the insurance sector for NEDs has increased by 70%.
The Damhurst report provides NED remuneration data for several insurance industry segments including mutuals, MGAs, Lloyd’s Managing Agents and brokers. It also distinguishes remuneration details between chairs and non-chairs.
Simon Beale, head of board practice at Damhurst, said: “The latest Damhurst NED Remuneration Report provides a much needed, current reference point for NED compensation which is critical if the insurance market is to continue to attract and retain the best talent on its boards. We consider our advisory expertise to be a significant part of our role in assisting clients in finding the most appropriate NEDs for their Board. This report supplements that advice.”