Insurance Executives Seek More Diversity in Executive Ranks

By | November 19, 2020

When Jerald Tillman and Mike James started their careers more than 20 years ago, working in the U.S. insurance industry was not on their radar, but programs to attract Blacks and other minorities brought them into the fold.

Today, Tillman runs his own insurance agency in Ohio and is the founder of the National African American Insurance Association. James, who is also Black, heads the division in charge of life insurance, long-term care, annuities and wealth management at broker NFP in its Boston office.

They and other minority insurance leaders told Reuters that despite years of recruitment and a strong pipeline of talent, the industry has not changed enough where it matters most: at the top.

“There are not enough people of color in executive leadership in the insurance industry,” James said in an interview.

Insurance, though improving, remains a less diverse industry than other financial services and U.S. employers as a whole.

Three insurance industry leaders who spoke at the Future of Insurance USA conference said during a panel hosted by Reuters Events on Tuesday that they are working to fix what they described as diversity shortcomings in the industry.

For example, only three of 168 senior executives of the top 10 U.S. insurers and brokers by market value are Black, according to a Reuters review of their websites. Among 119 board members at the same companies, 13 are Black.

“We must get white males involved with us in this leadership effort,” George Nichols III, president of the American College of Financial Services and the first African-American insurance commissioner in Kentucky, said during the panel discussion. “They control the positions. They control the decision-making process.”

Criticism of corporate America for a lack of diversity intensified after a white Minneapolis police killed George Floyd, a Black man, in May, setting off nationwide protests against racial injustice and police brutality.

S&P Finds U.S. Insurers Made Modest Gains in Diversity Over Decade

Measuring the Moment: How Will George Floyd’s Death Matter to Insurance Industry?

Insurance, though improving, remains a less diverse industry than other financial services and U.S. employers as a whole, research has shown.

Non-white employees, including Black, Asian and other racial minorities, totaled 21.4% of the workforce at U.S. insurance companies last year, up from 19.8% in 2018 and 15.3% in 2010, according to S&P Global Market Intelligence.

That compares with 24.9% of employees who are non-white in banking and related activities and 22.3% for the overall workforce, it said.

DOOR ‘BLOWN OPEN’

Police killings of Blacks and the resulting civil unrest this year have sparked discussions “that we never used to have before – the hard conversations about race,” Lata Reddy, senior vice president of Inclusive Solutions at Prudential Financial Inc. and chair of The Prudential Foundation, told the panel.

“The opportunity to build right now on that is huge,” said Reddy, who identifies as Indian American. “A door has been blown open and it’s incumbent upon all of us to run through it.”

Diversity programs work best when top leaders see the benefits and give strong support, but awareness also is critical throughout a company.

Research has shown direct managers have even more impact than senior leaders on employees’ experiences, Lauren Young, director of diversity and inclusion at Zurich North America, part of Zurich Insurance Group AG, said during the event.

“If they’re not aware of their own unconscious bias, it’s very difficult for them to understand what role they play,” said Young, who is Black.

Zurich held a town hall in June to allow Black employees to share stories about facing inequality. More than 3,000 people attended what became a catalyst for more action, Young said.

“It was very raw, it was very honest, there was a lot of emotion felt,” she said.

ARE YOU HIRING?

When companies say they are committed to increasing the number of minority employees they have, Nichols said he wonders if they’re hiring.

If not, “you’ve just created a dynamic in your organization that may not be so great,” he said. “Because in order for you to bring these folks in, somebody may have to go if you’re not creating new jobs and new opportunities.”

Reddy said research has shown racial diversity improves a company’s ability to innovate, reduce risk and bring different perspectives to decisions.

“Without that (diversity) we’re not going to be able to meet the needs of an increasingly diverse customer base,” Reddy said.

“Ultimately what we’re doing is leaving money on the table.”

(Reporting by Alwyn Scott Additional reporting by Ross Kerber and Jessica DiNapoli Editing by Lauren Tara LaCapra and Paul Simao)

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  • November 20, 2020 at 12:44 pm
    Craig Winston Cornell says:
    “The opportunity to build right now on that is huge,” said Reddy, who identifies as Indian American. “A door has been blown open and it’s incumbent upon all of us to r... read more
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