Women in the Insurance Industry

Women in Insurance Industry:

Throughout a majority of my career the insurance industry was not a good representation of diversity. It was comprised of mostly Caucasian middle aged men – however things are changing and for the better. This is great to see and I couldn’t be happier. The diversity and talent that women in the industry bring addresses a great need of insurance. Now it’s time to continue to ensure this trend, the continued success of women in the industry, at all levels of insurance organizations from the entry level to board room.

Industry Need

The insurance consumer has changed throughout the course of time and will continue to change. The way financial decisions are made by families has changed and continued to change. For example, studies have shown that women play an equal role in the household financial decisions and it would be a mistake to disregard or not recognize this change in consumer behavior and needs.

How is an industry supposed to sell insurance to a diverse society if it is not made up of diverse individuals, backgrounds, and ideas?
How is the industry supposed to be ahead of losses if it is not ahead of change in the world and living in the past?

The language of risk should be blind to sex and gender. I know we use past experience as a way to evaluate and predict the future – but not when it comes to talent management. Our past successes as an industry were independent of sex and the insurance industry has realized its time to change. The results may have been better historically with women playing a larger role.

Currently in Insurance

Again it doesn’t seem as if there is a lack of women in today’s insurance industry. At agencies/brokerages, at industry meetings, among underwriters and carrier personnel—the ratio of women to men seems close to equal. For example, according to the Bureau of Labor Statistics , women make up 83 percent of “insurance claims and policy processing clerks.”

The numbers of women in insurance will continue to remain high as the valuable contributions can be seen.

Talent issues

The industry faces a talent challenge and according to a study by McKinsey – will need to replace the talent leaving due to retirement. These talent issues will be throughout all levels of the organization from mail room to board room. As more and more middle aged men are retiring, they will be replaced by a larger mix of men and women. There are some organizations and conferences already addressing the role women play in the industry.

The Future

Although there are plenty of women in insurance, very few are in the C-suite. At the largest insurers and reinsurers, women hold only 6 percent of top executive positions, 12.5 percent of board seats, and 8 percent of inside business, legal or actuarial officer roles, such as chief actuary or division president, according to a recent industry study by St. Joseph’s University Academy of Risk Management and Insurance. This is a number that is bound to grow however the industry must train young women in the industry and dedicate resources towards them exclusively.

If current Insurance leaders don’t spend more time and energy training and mentoring future women leaders of the industry, the insurance industry may suffer some poor financial results as a result of the brain drain. According to McKinsey, “The insurance cycle destroys billions of dollars in value for carriers and the industry as a whole. While there are several contributing factors, our analysis indicates that as much as 40 percent of this value is lost because of poor managerial and underwriting decisions by those in risk management roles.” If future leaders aren’t appropriately prepared and succession plans created, it has negative financial impact. Specifically preparing women for the C level and board room roles.

Board rooms are starting to change, and there have been discussions around actively diversifying the board room. As we previously discussed, we think it’s crucial for organizations to have insurance thought leaders in the board room (here’s why)- regardless of sex, gender, race, etc.

Books/Resources

We have detailed two different articles on Top 10 books for Reinsurance and Top 10 books for Insurance, however we think these are a few extra resources that may help women reading this article on the journey and career success.