Nine out of 10 insurance employers will increase salaries at upcoming reviews as an unprecedented skills shortage creates a “once-in-a-career" market, recruiter Hays says.

The latest Hays Salary Guide, released today, says employees are “in an ideal situation” as unemployment is predicted to slide to a 50 year-low of 3.5%, and more than 60% of employers plan to hire.

Insurance took seventh place for being the industry with the most extreme skills shortages in Australia. Banking took the number one spot, followed by manufacturing, construction, technology, engineering and architecture. Healthcare, mining and retail rounded out the top 10.

“This is fueling a once-in-a-career market,” Regional Director Carl Piesse said. "Skills shortages have reached a level unmatched in our years in recruitment and sparked deliberate salary increases from employers,” he said, adding this was previously “camouflaged” by skilled migration.

Intense competition for skilled professionals will translate into gradual salary increases this coming financial year, Mr Piesse says, as 87% of employers in Australia struggle to meet skill needs – most saying it will impact operations or growth.

The highest salaries in the insurance sector belong to heads of claims and chief underwriters in life insurance, where $200,000 a year is typical. In general insurance, heads of claims average $180,000, and underwriting managers and account directors in broking can expect typical salaries of at least $170,000 in various states, the Salary Guide says.

The top five insurance roles employers need to fill in Australia are claims assessors, SME underwriters, contact centre agents (lodgment), brokers, and technical claims managers. In New Zealand, underwriters, brokers, loss adjusters, claims handlers and broker support were listed.

Hays found 94% of insurers will up pay rates - a jump from around three-quarters a year ago and indicating more employees will receive a pay rise this coming financial year than last.

Around two-thirds of insurance employers (55% in New Zealand) have already offered higher salaries than planned and 73% (29% in New Zealand) are hiring.

An uncompetitive pay rate was the top factor motivating job searches - ahead of a lack of promotional opportunities and negative mental health and wellbeing. Hays advises employers to consider non-salary perks such as benefits, upskilling, career progression and purpose.

The report says more than half of insurance workers (33% in New Zealand) are more confident to ask for a pay rise this year and 43% (64% in New Zealand) do not intend to remain with their current organisation after the coming financial year.

A third of employers in insurance intend to raise salaries by 3-6% - and 11% by even more.

Half will increase salaries by less than 3% though, and Hays warns jobseeker expectations should still be “coupled with business realities,” with Mr Piesse saying employee expectations are outpacing true conditions.

"In a job-rich, candidate-poor market, they feel more assured of their worth and have prioritised a pay rise,” he said.