Risk Management/Insurance Internships: Job Postings and Compensation

February 2010

In my last commentary, Risk Management/Insurance Intern Preparation, I talked about the broad ideas you'll want to keep in mind when establishing an internship program, including how to cast a wide net in terms of publicizing your opportunity. So what's next?

by Brenda Wells, Ph.D., CPCU, AAI

You'll need to post your job and conduct interviews with qualified candidates.

Job Postings

College students want to know the same things any other candidate wants to know, plus a few others that impact the decision to apply for what is effectively a temporary job:

• Where they'll work. Location may be important—the distance from home and/or campus, along with traffic.
• What your company essentially does. Do you sell property insurance, or do you provide consulting services to corporate risk managers?
• What the internship duties will be. Even if you have only reached the point of saying "they're going to shadow some of the executives on occasion and otherwise assist with daily office tasks as needed," that's information they need to have. If you're willing to consider designing an internship to suit a candidate's strengths (or to help them improve on a weakness), you might include a statement that indicates the duties will be agreed upon at hiring.
• How long (weeks, months, or indefinitely) the job will last. No one who has bills to pay wants to give up a steady paying job to work for 6 weeks. If your internship is really short in terms of length, state that up front so that only candidates who are willing to consider such a short-term assignment apply.

The next step is to plaster that job opening everywhere your target interns might be. Send it to career centers at local campuses, professors, and colleagues at other firms. Of course, circulate it internally, because some of your employees may have kids they want to bring into the business. I quite honestly do not recommend paying for advertising in a campus paper unless you have tried all these other places and still not found the person you're looking for. Most of my students tell me they never look at the paper (with my sincerest apologies to anyone out there who may have been a journalism student—I'm just telling you what I've heard!).

Deciding What To Pay

Notice I didn't list compensation as an item to include in your ad. My advice is not to decide that the pay rate is set in stone, and instead remain flexible until you've at least gotten to know the students interested in the position. A pay rate that's too low may turn off good candidates, and a rate that's too high may ultimately leave you besieged with interview requests from a lot of students who may not really care about a future in this business, but rather seek a short-term money-making venture. I wish I could just put down a chart of suggested pay ranges here that would solve all your problems, but as with any other position you have to fill, there are a host of factors that go into determining what you must be prepared to spend. Here are a few that I personally can think of, and you may find that intern candidates suggest others to you.

• What other internships are paying in the area. The best of the talent will get the highest offers, as is the case any other time. If you want those students, you've got to be willing to match or beat the competition.
• The cost of living and tuition.
• The cost of textbooks and course "fees." This is worthy of mentioning separately. Nowadays, many basic business textbooks are $180 each. Course "fees" are another way universities can pass on the cost of doing business and operating to students. In addition to tuition of several hundred dollars per course, there may also be a $50+ "fee" that covers some of the materials, supplies, copies, consumables, etc. These are separate from tuition and can sometimes add up to $1,000 or more per semester, depending on the university.
• Gas prices. They can really affect things, especially if the student has to travel a great distance to get to your office or has a real traffic problem to contend with. A student who lives closer simply doesn't incur those costs (or as many of them). When gas prices are over $3 a gallon, one thing to consider is offering a commuting expense or gas "bonus" to interns who are driving in from afar or who have unusually high commuting expenses. This prevents you from paying one intern a higher salary than the other, but still compensates for expenses of the one who travels father.
• Whether or not you are providing housing and/or a car. Many employers bring in interns from some distance, give them housing, and pay at least $12 an hour on top of that. If you find a candidate who doesn't live close by, you may need to pay more to help them cover housing expenses.
• What other part-time jobs are paying in the area. As I've mentioned previously, more students these days have to work, they aren't just doing it for the experience. If a student is making $15 an hour bartending or waiting tables, they are not going to give up that job to earn minimum wage with you.

I cannot emphasize enough that it is dangerous to lock down on one set pay amount and then refuse to reconsider others, especially if you're new at this. Let's suppose you are going to work someone for 40 hours a week for 8 weeks in the summer. That's 320 hours. If the candidate wants $12 an hour, and you wanted to pay $11, are you going to let $320 of tax-deductible expenses stop the process? You may ask, "Why would the student let it stop them from getting all this valuable experience," and my answer to that is that $320 may pay for two required textbooks or a summer school class needed for graduation.

So, what I recommend is that in the ad, you simply state that "Pay is negotiable." That leaves you with the flexibility to set the price so you can hire the intern you really want.

In my next column, I will talk more about scheduling and conducting interviews with prospective interns.

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