When is a minority not a minority? When it's a majority. According to many demographic forecasts, by the middle of this century, people of color will constitute a greater share of the U.S. population than Caucasians. This historic and unprecedented shift is occurring as the result of steady increases in the numbers of African Americans,
Asian Americans, Native Americans, Hispanics, and other racial and ethnic groups traditionally labeled "minorities."
The impact of this trend on the American landscape is being felt in every aspect of our lives, from the food we eat and the music we hear to the wider issues of political agendas, buying preferences, education and housing needs--and business initiatives. The insurance industry, historically a white male bastion, now is taking on more diverse hues in response to the growing presence and power of minority populations. As clear evidence of this trend, the National African-American Insurance Association (NAAIA) held its 2000 annual conference jointly with the IIAA annual convention in Orlando, which also was attended by members of the Latin American Association of Insurance Agents (LAAIA). The convention featured workshops for multicultural and urban agents as well as invaluable networking opportunities, and the Big I's leaders affirmed their support for the initiatives of the two associations.
Recognizing the needs and opportunities created by the growth of minority populations, a number of major property/casualty carriers also are reaching out to minority agents and offering them assistance in building successful agency operations in what often have been unserved or underserved markets.
At the IIAA convention, Rough Notes had the opportunity to speak with leaders of the National African-American Insurance Association and to gain insights into the organization's mission, goals, and ambitious agenda. Sharing information were founder and Executive Director Jerald Tillman, LUTCF, J.L. Tillman Insurance Agency, Cincinnati, and key NAAIA board members: Chair Denise Lloyd, CIC, D.H. Lloyd & Associates, Washington, DC; Vice Chair Roosevelt Hayward II, Haywood & Fleming Associates, Gary, Indiana; and Treasurer Raphael Madison, assistant vice president-marketing at Safeco.
NAAIA: vision, commitment, action
With headquarters in Washington, D.C., the National African-American Insurance Association was created to:
* Enhance professional attitudes and conduct among minority insurance professionals
* Promote long-term commitment of minority professionals to careers in the insurance industry by extending an atmosphere of encouragement, support, and understanding to all members
* Build alliances with other professional insurance associations
Spearheaded by a 13-member board of directors, NAAIA is working aggressively to build membership nationwide and to establish chapters in key locations. Its target groups for membership are African-American underwriters, claims adjusters, sales representatives, managers, and other professional specialties in the insurance industry. NAAIA's directors represent a balance of independent agents and insurers that are reaching out to minority markets, including Safeco, American Family, Prudential Property & Casualty, AFLAC, and New American Insurance Company.
NAAIA's objectives are clearly articulated in its statement of purpose, mission statement, and statement of goals.
Statement of Purpose
The NAAIA was organized to create a network among minorities who are employed by insurance companies or self-employed in the insurance industry. Pooling this wealth of talent contributes to the growth of the association and its members through sharing of professional experience, knowledge, and information.
The NAAIA will attempt, on a continuous basis, to promote professionalism in a manner that will lead to industry recognition and future career opportunities.
Mission Statement
The National African-American Insurance Association (NAAIA) shall coordinate the national efforts of the African-American insurance organizations and professionals.
The organization will also invite individual memberships from those who do not have a local chapter in their area. If interest does exist to build a local chapter in a respective city, the NAAIA will contact the nearest member association for follow up.
The NAAIA shall engage in the following activities: publish a quarterly newsletter, plan and promote national conferences, provide advocacy for national issues, exert influence in many insurance-related areas, and maintain an insurance database.
Stated less formally, the NAAIA's mission is "to broaden the African-American presence within the insurance community. NAAIA supports the professional needs and requirements of its members by creating opportunities for growth and competition for African-Americans and other minorities within the insurance industry. NAAIA significantly increases the nationwide presence, participation, and long-term financial success of African-American insurance professionals within the greater insurance community, and provides members and the insurance industry a forum for sharing ideas and information that enhance business and professional development. NAAIA provides nationwide networking opportunities that will strengthen professional experience through local, regional, and national activities."
Statement of Goals
* To create a viable support system for African-American insurance professionals that enhances their careers.
* Support the business objectives of members by creating nationwide networking opportunities specifically structured to increase contacts and leverage within the greater insurance community
* Support the professional and business development plans of members by sharing nonproprietary information and business experiences that enhance long-term success and strengthen communication within all levels of the national association through local, regional, and national activities
* Promote long-term success of members in professional insurance careers through encouragement, understanding, and recognition of the unique challenges confronting African-American insurance professionals
* Encourage professional development and growth through educational programs such as LUTCF, CLU, ChFC, CPCU, ARM, ACSR, and CIC, and through adherence to the highest ethical standards
* Build mutually beneficial partnerships with traditional insurance trade associations and other associations representing the interests of minority insurance professionals. NAAIA is forming alliances with associations such as the National Insurance Association, National Insurance Task Force, Independent Insurance Agents of America, Professional Insurance Agents, National Association of Life Underwriters, Million Dollar Round Table, Society of Chartered Life Underwriters, and Latin-American Association of Insurance Agencies.
* Inform members, through NAAIA's quarterly newsletter, of significant issues affecting the business of insurance and provide information concerning career advancement opportunities
Energy to go
Have you ever known anyone who seemed to create her own energy field? If so, you have a head start on understanding the personality of NAAIA Chair Denise Lloyd, CIC. Founder and president of a highly successful insurance brokerage in Washington, D.C., with branches in Baltimore and Dallas and licenses to operate in 47 states, Lloyd serves up a compelling mix of idealism and street smarts, liberally laced with business savvy, passion, and wry realism. Formerly a member of the New York City Police Department's narcotics squad, Lloyd has few illusions but a lot of heart--and an unwavering determination to help African-American and other minority agents gain access to the resources they need to build successful businesses.
Minority independent agents, she comments, face a daunting array of challenges that likely are unfamiliar to most other insurance producers. Chief among these are obtaining markets, hiring and training competent support staffers, and building enough volume and favorable loss experience to qualify for contingency commissions. A common phenomenon was what Lloyd calls "drive-by" agent appointments. "A company representative would drop by with a contract, then disappear. They didn't introduce us to underwriters or offer us any information."
A number of major carriers now are making sincere efforts to reach out to minority markets, Lloyd notes with satisfaction. Among the insurers that are seeking minority agents are Allstate, AFLAC, American Family, Grange Mutual, MetLife Auto/Home, Nationwide Insurance Enterprise, Ohio National Financial Services, Prudential Property & Casualty, Safeco, St. Paul, the Mony Group, Travelers, and UNUM.
Safeco is represented on NAAIA's board by Assistant Vice President-marketing Rafael Madison, who heads up the insurer's urban and minority outreach initiative. Safeco actively recruits minorities across the country to fill claims and underwriting positions and to participate in agency training programs. Such efforts, Madison says, are based not on social concerns but on economic realities: "Two thirds of minorities are middle class or above," he asserts. "We must recruit minorities to stay ahead of the competition."
Maintain standards, adjust approach
It's not enough merely to recruit and appoint minority agents, Madison adds. "We must go to our companies and explain that once they have given an agent a contract, they must provide tools to help that agent succeed." Such tools include sales training, assistance in recruiting and developing a competent support staff, and both products and promotional literature tailored to minority markets. "We should tell our companies, 'Don't lower your standards--change your approach,'" he says. "At Safeco, each regional office is charged with creating its own diversity plan to respond to the needs of its minority markets, whether they are African Americans, Native Americans, Asian Americans, or women."
For many generations, insurers were accused--sometimes justly--of engaging in the practice of redlining: literally drawing red lines through minority or urban neighborhoods. Whether done in response to actual loss experience or based on prejudice and stereotypes, redlining prevented many qualified minorities from obtaining coverages and caused them to harbor a deep distrust of insurers. An important step in the right direction, Madison says, is a new credit scoring model developed by the insurance industry. Safeco uses the new model, and in testing it has found no difference in scores between urban and suburban neighborhoods. "The facts trump stereotypes and prejudice," Madison comments. In fact, at Safeco, "Growth in urban areas is outperforming growth overall."
One agent who is well acquainted with the needs of his market is NAAIA Vice Chair Roosevelt Hayward II, a second-generation principal in Haywood & Fleming Associates. Based in the heavily industrial city of Gary, Indiana, the agency can claim a long history of growth and success. "My father was in the insurance business for 49 years," Hayward explains. "He built up his commercial business first; his first contracts were with American States and Hartford." Once it had established a solid base of commercial accounts, the agency entered the personal lines arena. "We achieved success in personal lines by building big volume and developing a good staff to stay ahead of losses," Hayward says.
Taking the next step
In any organization, gains often are achieved gradually--but sometimes in big, bold leaps. With Denise Lloyd's guidance, NAAIA is in the process of making just such a leap: the creation of a facility that will give agent members access to markets and services they might have difficulty securing on their own. "Smaller agencies may lack the support staff expertise to respond on a timely basis to requests for information, quotes, certificates, and endorsements," Lloyd explains. This problem, combined with low volume, is a major reason many minority agents are unable to obtain quality markets and build sufficient volume to earn contingency commissions. "We're competing with a small talent pool and little name recognition," Lloyd says. In a word, what these agencies lack is clout.
The D.H. Lloyd Insurance Exchange is being established to help NAAIA member agents achieve that priceless commodity and use it to grow in volume, income, and expertise. D.H. Lloyd & Associates, with licenses to operate in
47 states, will serve as the intermediary and back office support for participating agencies, in exchange for 50% of the commission on each piece of business placed. "We'll help agents prepare applications, obtain information, and meet underwriting requirements," Lloyd says. "We want to create opportunities for agents to participate in contingencies and understand how losses affect them financially. The idea is to help agents build clout and credibility with markets."
The exchange is supported by a team of major insurers. Many minority agents have been forced to deal with underwriters who were unresponsive to the needs of their clients. That won't be a problem for members of the exchange. "We've been assigned underwriters who must answer to a higher authority," Lloyd says. Each participating agent retains ownership of the business he/she produces and signs a three-year contract with the exchange. "Once an agent has enough business, he can get his own contract with an insurer," Lloyd explains. "We want to help smaller agents grow and maybe create their own insurance exchanges. As they grow, they can put aside money to hire their own talent." Quarterly meetings will offer educational opportunities and provide a forum for the exchange of information.
"The issues that affect us are economic, not social," Lloyd declares. "Money trumps race. If you bring enough money to the table, you'll get attention." Under the dynamic leadership of Denise Lloyd, there's no question that NAAIA is getting attention--the kind of attention that helps its members build successful, competitive businesses and become forceful players in the insurance marketplace. *
For more information:
National African-American Insurance Association
1625 K Street, NW, Suite 400
Washington, DC 20006
Phone: (202) 293-6307
Fax: (202) 223-9438
Web site: www.naaia.org