As demonstrations against systemic inequalities take place across all 50 states and in countries around the world, individuals and companies alike are voicing their support and commitment to improving equality, diversity, and inclusion within their industries and the communities they serve.
The insurance industry has an important voice in this discussion. As insurers and insurtechs voice their support for this movement, it’s vital they take action in-house and enact the changes that put action to their spoken commitments. Above being the right thing to do, improving diversity and inclusion has the added benefit of being directly linked to improved financial results and innovation efforts outcomes.
Here are 10 ways in which the insurance industry can work to promote equality, diversity, and inclusion for employees and customers alike.
- Improve diversity in the C-suite
This is an age old problem in the corporate world, including the insurance industry. According to a McKinsey report, while white women make up 45 percent of entry-level jobs in insurance, they hold only 18 percent of the C-suite. For women of color, this number drops further to 12 percent of entry-level and a tiny 3 percent of the C-suite.
“I think a diverse leadership team impacts recruiting at all levels for both men and women,” says Pat Renzi, Principal and CEO of the Life Technology Solutions practice of Milliman. “Everyone wants to feel they can be themselves, that their opinions are valued, and that there are people who look like them running the organization. It is empowering.”
- Refuse to implement technologies that are susceptible to bias
There are many different technological solutions available to insurers today. As insurers' tech adoption and digital capabilities increase, it’s important to recognize the potential for these new technologies to sometimes do more harm than good. It is well documented and understood that, without proper programming, technologies like facial recognition and AI have the potential to inherit existing bias against minority customers. Insurance companies should be extremely wary of adopting any technology that is susceptible to any sort of bias, and equally willing to let go of that technology should it develop a bias later on.
- Work diligently to address the pay gap
Despite the high number of women working in the insurance industry, a study by Women in Insurance: Leading to Action found that the gender pay gap is 62 cents to the dollar, worse than it was in 1951. While the report doesn’t include stats based on race, in many industries, the pay gap for women of color is even more significant. In an industry where women make up the majority of the workforce, it’s imperative that leadership, management, and hiring teams offer increased opportunities for women and commit to closing pay gaps across their workforce.
- Implement and enforce company policies against discrimination and harassment
Just last year, a report by Bloomberg Businessweek described the London insurance market as “the most archaic corner left in global finance” and detailed numerous reports from women who described a culture of “near-persistent harassment.”
Insurers should work hard to develop and rigorously enforce company policies that prohibit sexual harassment of any kind. In the wake of the #MeToo movement, the insurance industry actively began to blacklist entire industries from sexual harassment insurance. It’s vital they also turn this scrutiny inwards and consider the damage an exclusive legacy culture has within their own workforce.
- Hold corporate customers and industries to a higher standard
As mentioned above, the ability for insurers to blacklist entire industries from certain forms of insurance is a powerful motivator for those industries to address systemic problems. Lack of insurance leaves many industries and companies incredibly exposed to lawsuits, and insurers have the power to decide when they’re not willing to take on these risks. As a business enabler, insurers have an opportunity to step back from harmful companies and industries and push them to improve their practices.
- Improve and diversify products and distribution to address the insurance gap
While many insurtechs and insurers are making large strides to make insurance products more personalized, affordable, and accessible, there’s still a significant insurance gap that exists across numerous insurance lines, particularly health.
Rowan Douglas, CEO of the capital, science and policy practice at broking group Willis Towers Watson PLC, said, "There is an enormous amount of work to do. This isn't just an economic and financial issue for the industry; this is literally protecting people's lives, livelihoods, shelter and key assets."
Addressing issues of policy cost, distribution, customer care, and product diversity are all steps insurers can take to begin closing the gap within their particular segment of the industry. Large insurers also have the opportunity to partner with smaller insurance providers, like insurtechs, and boost their efforts and capabilities beyond their own product portfolios.
- Be incredibly vigilant for bias when manipulating and analyzing large datasets
Improving data collection, analytics, insights, and applications is a priority for many insurers, particularly now. While increased use of customer and competitor data has many positive implications for product customization and improved customer experience, the tools and techniques used to analyze and interpret this data need to be monitored in case they adopt any sort of bias from preexisting data sets.
- Diversify the hiring process
The insurance industry is experiencing a persistent talent gap, particularly when it comes to recruiting young people to the industry. Taking a critical view of existing hiring practices through the lens of diversity and inclusion, from recruitment through onboarding, is a great step to addressing negative legacy culture.
- Communicate with customers and communities
Customers have more choice behind their purchasing power than ever before. Access to online resources and comparative websites like Policygenius put the control in the hands of the consumer - and there are many options for them to choose from. Research from Accenture found 63 percent of surveyed global consumers prefer to purchase products and services from companies that stand for a purpose that reflects their own values and beliefs, and will avoid companies that don't. This makes it incredibly important for insurance companies to be vocal and transparent about the efforts they’re making, both internally and within their communities and networks, to make a difference and promote diversity and inclusion of all kinds.
- Establish a process through which to track initiative progress and be diligent about monitoring it
We’ve all heard this one before: unless you diligently track and monitor progress, and adjust when needed, it’s near impossible to create real, meaningful change. And this issue does require real and meaningful change.
We’re currently experiencing one of the largest civil rights movements in history, and the initiatives and efforts that companies and industries do, or do not, implement now will be noticed by the next generation of employees, leaders, and customers. Many insurers and insurtechs have been vocal about the changes that need to be made and are already taking steps to address them. It’s important that this movement be sustained to create an industry that’s more equal, diverse, and prepared to respond to the shifting needs of all potential and existing customers and employees - not just the privileged minority.
If you have a topic you'd like us to cover, or you'd like to become a contributor, we'd love to hear from you! Please email our editorial team with an overview.