INSURANCE IS FUN (AND OTHER OXYMORONS)

Tooting the industry’s horn

So, why the bad rap? …People don’t like what

they don’t understand, and they don’t understand insurance.

By Cheryl Koch, CPCU, ARM, AAI, ACSR, AFIS, and Mary Belka, CPCU, ARM, ARe, RPLU, CIC

Most of us are aware that the insurance industry is facing a talent dilemma, if not an actual crisis. For those of us who truly love the insurance business and are thankful for what it has enabled us to enjoy during our careers, these sentiments are not largely held by the “outside world.” 

Imagine someone interviewing the students in your local elementary school and asking them what they want to be when they grow up—and not a single child aspires to be an insurance professional. And that probably includes some students whose parents have had very successful careers in the industry!

It’s a bitter pill to swallow, but one we must accept in order to overcome the challenge of recruiting new talent to our business—we just don’t seem to have the same je ne sais quoi as other industries. Why is that, and what must we all do in order to ensure we get our fair share of the best and brightest talent now and in the future?

Physician, heal thyself

One could argue that, in some respects, we are our own worst enemy. The bad acts of the very few are imputed to the whole. When one person or organization behaves unethically, we all suffer for it. Recent scandals and bad press, whether in property and casualty or life and health insurance, cast a shadow over us all. We can’t get away with saying “Oh, but you don’t understand, that’s not the kind of insurance I deal with” because consumers and potential employees do not distinguish between the various types of insurance. And to the extent that big business (and big profits) are being vilified in the press and on social media every day, we are an easy target.

The U.S. insurance market alone accounts for over $1 trillion in annual premium and over three percent of gross domestic product (GDP), and while our profit margins have not been anywhere near as high as other industries, we have built policyholder surplus to an all-time high in the last several years.

So, why the bad rap? Well, it’s simple: People don’t like what they don’t understand, and they don’t understand insurance. Some things we can all do to improve the image of our industry and perhaps make recruitment less of a beat-down:

• Seize opportunities to educate people about the insurance industry. If misunderstanding leads to mistrust and apathy about working in the field of insurance, then knowledge and education will surely help overcome the negative perceptions.
• Help consumers understand where their premium dollars really go. For the most part, they go directly back into the hands of policyholders who have suffered losses. While a portion of every dollar goes toward insurer expenses and profit, literally the lion’s share is used to pay losses. Most people think our industry is far more profitable than it really is.
• Explain to people the importance of an industry with a solid balance sheet. Policyholder surplus exists so that we can honor the promises we make every day. It’s not a question of “if” losses are going to take place—it’s simply a matter of when and to whom.
• Tell the good stories, the ones that are unlikely to make the local or national news. Our industry contributes to some amazing causes every day and agents and brokers, in particular, are actively engaged in their communities. Make sure everyone knows what business you work in and how it benefits individuals, families, and other businesses and organizations in your community.

Adopt a school

Even in rural areas, kids still have to go to school. There may be some attending school remotely or who may be home-schooled—meet them where they are. In high school, most kids are dreaming about that day of ultimate freedom—getting their driver’s license and watching mom or dad in the rear-view mirror—or doing so as an Uber passenger. They are on the cusp of becoming a potential client—and employee.

Since we haven’t controlled the narrative, that’s become yet another negative attitude about insurance: “We can’t afford to have you drive; do you know how much our auto insurance will go up if we have to add you as a driver?” Once again, consumers don’t understand insurance rating and pricing. Why not start unraveling that mystery at a young age, and create a more knowledgeable potential client base and employee pool? If they’re impressed with you, you might just change their mind about a career.

Give a brief presentation about auto insurance and how premiums are determined. Remember who your audience is—they, like their parents, don’t necessarily understand the connection between speeding tickets, accidents, credit ratings, deductibles, and premium dollars.

Show how insurance organizations are behind many of the safety improvements in the automobile industry. Safety begins at home, and you may be speaking to a future insurance loss control professional.

Create a new “addiction”: solving real issues. Demonstrate how emerging, cool risk management technology is reducing the number of claims—and premiums—for instance, “flow” systems that detect water leaks in homes before they happen, and alert you via your smart phone. What about cyber and intellectual property risks, drones, and AI (artificial intelligence)? These are areas where new ideas are needed to combat an exponentially growing area of claims and legal challenges. There are many opportunities for young people in our industry, including insurance law, risk management and insurtech—just a step away from the video games they love!

Have fun! Make a game of it! Bust some myths! Isn’t one of the enduring impressions of an insurance person that we’re boring (present company excepted)? Better to be prepared to engage and surprise them by dispelling some stereotypical myths about our industry than to confirm what they already think they know about us. Leave them wanting to learn more.

Use the resources that are available. Educating others does not require rebuilding the proverbial wheel. The Independent Insurance Agents & Brokers of America (IIABA) sponsors the Invest program (investprogram.org), which is specifically designed to educate high school and college students about the insurance industry and the many diverse careers available within it. Insurance carriers love to provide information at no charge, including fascinating, actual claims videos. Include some visuals in your presentation and stimulate some interactive discussion. Reel them in by making it real!

Teach your children well

Just like the dog who finally catches the car, we often find that diamond in the rough but don’t know exactly what to do to cut it, polish it, and reveal its brilliance. Independent agents, in particular, have struggled with onboarding and training newcomers to the industry. While we wish there were myriad technical schools where one could learn to be an insurance producer, account manager or even agency owner, those are ideas that are just now taking hold.