In recent years, the insurance industry has shown improvement in workforce diversity, particularly related to gender. The property and casualty sector and the life and health sector experienced notable progress in 2021, with the S&P Global gender diversity scores for both sectors rising to 52 in 2021 from 49 in 2020, demonstrating a growing commitment to gender equity. (The S&P score typically ranges from 0 to 100; the greater the gender diversity of the company, the higher its score.)
Still, a 2023 report from the Insurance Industry Charitable Foundation indicated that women hold only 12% of the industry's C-suite positions. This statistic underscores the gender disparity that persists at higher levels of management and the need for increased efforts to promote gender equity in leadership within the insurance sector.
As efforts continue, it's important to recognize and address fatigue around diversity, equity and inclusion (DEI) efforts. Companies need to be intentional with DEI initiatives so that those efforts remain effective and don't overwhelm employees. Shifting from simply initiation of DEI efforts to robust implementation is pivotal for the industry; it redirects attention from mere planning to tangible actions woven into the fabric of the business.
Embracing implementation is vital because diversity enriches the industry with a multitude of perspectives, ideas, and solutions, enhancing creativity, problem-solving, and decision making. Moreover, it reflects and serves the diverse customer base more effectively, fostering inclusivity and understanding, which are key to long-term success and resilience.
The picture of diversity in the insurance sector is varied; while women are well represented—making up 50% of insurance sales agents and holding 58.2% of roles like claims adjuster, appraiser, examiner and investigator in 2021, according to U.S. Bureau of Labor Statistics data—minority representation lags. For instance, Black or African American individuals represented only 11.8% of insurance sales agents, with Asian Americans representing 4.1%, and Hispanic or Latino individuals 16.5%. In roles like claims adjuster and policy processing clerk, these figures vary slightly but still reflect underrepresentation of ethnic and racial minority groups. This underscores the need for more inclusive hiring and advancement policies to create a truly diverse workforce.
To build sustainable operations for the future, the insurance industry must integrate strategic workforce planning, continuous learning and technological innovation into its core operations to foster a more inclusive environment.
Strategic workforce planning, with its emphasis on global collaboration and remote work potential, aligns closely with the findings of Modupe Akinola's research at Columbia Business School. Akinola’s research underscores the performance benefits of diverse teams, highlighting the necessity of leadership commitment, strategic diversity integration and bias mitigation. Such an approach is not inherently effective but requires conscious effort.
Incorporating unbiased third-party evaluations can deepen the understanding of workforce composition and dynamics, crucial for developing an inclusive talent strategy. This step, focusing on representation gaps, not only meets inclusivity standards but also enriches the industry's intellectual and creative capacity, making the workforce strategy more comprehensive and effective. This process involves pinpointing and addressing gaps in representation, a step that not only aligns with inclusivity standards but also augments the industry's intellectual and creative wealth.
FAQs
The picture of diversity in the insurance sector is varied; while women are well represented—making up 50% of insurance sales agents and holding 58.2% of roles like claims adjuster, appraiser, examiner and investigator in 2021, according to U.S. Bureau of Labor Statistics data—minority representation lags.
How does diversity attract top talent? ›
Diverse workplaces are more innovative and have better business outcomes than their less diverse counterparts. Inclusive, innovative, successful businesses will always attract top job candidates.
Why does a diverse business experience increased profit? ›
Diversity in the workplace means you have more people to make personal connections with your customers. From their concerns and needs to their frustrations and personal experiences, customers want to feel understood and valued. A diverse team is more likely to achieve that end.
How can workplace diversity and inclusion affect employee satisfaction? ›
Embracing diverse and inclusive values leads to higher employee satisfaction. This results in improved productivity and profitability. Employees that feel empowered in their job are more likely to feel happier in the workplace. This promotes employee confidence that leads to innovative ideas.
What is an example of diversification in insurance? ›
It suggests that a person should spread their risk among various investments so that a loss in one can be offset by a return in another. A common example of diversification is investing in a combination of real estate, bonds, stocks, mutual funds, and treasury bills, instead of investing in just one of the three.
Which industry has the most diverse workforce? ›
The new Kantar Inclusion Index shows that health/pharma ranks as the most inclusive industry, while tech lags behind.
Why is diversity important in Talent Acquisition? ›
Likewise, maintaining a diverse and inclusive Talent Acquisition process helps strengthen your employer brand, raise your firm's reputation, and increase both innovation and employee retention.
What is the meaning of talent diversity? ›
Diverse talent recruitment focuses on sourcing, recruiting, interviewing and hiring candidates in underrepresented groups, including women, people with disabilities and individuals from different racial and ethnic groups.
How does diversity add value to a company? ›
When people of different cultural backgrounds and levels of expertise collaborate, it can help boost innovation and creativity within an organization. Because of their unique experiences, perspectives, and knowledge, diverse teams are more likely to bring pioneering ideas to the table than are more hom*ogenous groups.
How can diversity create a competitive advantage? ›
Overall, diversity can bring a competitive advantage by improving a company's ability to innovate, connect with customers, and attract and retain top talent. By leveraging the strengths and perspectives of a diverse workforce, companies can stay ahead of the competition and achieve long-term success.
Diversity can help your team become more agile and be better equipped to pivot and adapt as necessary to remain competitive. As data from McKinsey reveals, the top quartile of companies for ethnic diversity are 36% more likely to financially outperform their less diverse peers.
How does diversity increase employee engagement? ›
Employees from minority cultures feel more at home in a diverse workplace, which also provides them with the support they need to succeed on a cultural level. Those from underrepresented groups consequently feel appreciated, seen, and heard at your company. Development is the key to employee engagement.
Which is the best example of diversity at the workplace? ›
Gender is a prime example of diversity in the workplace. It was once thought that men were the primary breadwinners while the women stayed home and kept the house and raised the children. But in the modern world, women are forging their own career paths.
What is the most beneficial aspect of diversity and inclusion in the workplace? ›
Benefits of diversity and inclusion at work. A diverse and inclusive environment establishes a sense of belonging among employees, making them feel more connected and productive. Organizations that adopt D&I practices see huge gains in the form of business results, innovation, and decision-making.
How big is the insurance industry compared to other industries? ›
Insurance is one of the largest industries in the world, with a global market value greater than the gross domestic product (GDP) of many countries. While estimates can vary, most sources put the figure at around 6.8 trillion U.S. dollars of insurance premiums written in 2022.
How do demographics affect insurance? ›
Demographic factors. Insurance companies use some demographic information to help determine your rates, including your age, gender, marital status, and your ZIP code.
Is insurance a competitive industry? ›
In fact, one could argue that the insurance industry is more competitive now than ever before. A number of factors are contributing to this, including the economic slowdown, the rise of new technologies, and the entry of new players into the market.
What percentage of minorities have life insurance? ›
Black Americans are more likely to own individual life insurance than the general population. Fifty- eight percent of Black Americans own individual coverage, while just 52 percent of all Americans have individual coverage.
