Basic
salaries in the UK insurance industry increased by an average of 4.8 per cent
over the past 12 months, according to a survey by Watson Wyatt.
While
the increase was broadly in line with the rest of the economy, the insurance
sector continued to see wider use of variable pay, with less emphasis on basic
salaries and more on bonuses that reflect individual and company performance.
Iain
Nichols, a consultant at Watson Wyatt, commented, ""The trend in the
insurance sector appears to be more that more companies are managing their pay
bill more tightly and rewarding their higher performers through a combination
of base pay and performance-related bonuses."
Some
88 per cent of the 120 insurance companies in Watson Wyatt’s 2001 Insurance
Industry Total Compensation Report provide an annual incentive scheme.
Directors
and senior managers receiving bonuses benefited from an average boost to their
incomes of 25 per cent.
Clerical
staff received an average bonus of 10 per cent of their base salaries.
Nichols,
added, "This trend is not surprising. Business margins continue to narrow
and more companies are becoming cost sensitive and performance-led."
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