Point/Counterpoint: Independent Agency Diversity

Is the independent insurance industry equipped to attract minority consumers and talent?

YES.

I feel we serve in one of the most diverse industries in the workplace today. Numerous aspects of the insurance field present very attractive options for millennials, career changers and seniors. As an independent agent, I am blessed and challenged to serve a community that is getting more diverse each day. Whether it’s race, age, gender or even technology, the products we provide have an effect across any and all lines.

In the insurance industry, independent agents and carriers alike have all the tools and foundation they need to support attracting a diverse consumer base. The challenge comes from effectively utilizing these tools and committing to doing a better job of opening our minds and business operations to reflect the changes we see in the world today.

I have a saying on my desk: “Change is inevitable, growth is an option”. As an industry, we can no longer ignore social and cultural trends and still continue to succeed. Changes in the consumer demographic are compelling us as an industry to embrace a different way of doing business.

The opportunity for growth is always apparent. As an industry, I feel we have the right tools and people to help get us reach that next level.

—Quincy Branch, president & CEO, Branch Benefits Consultants

NO.

At least not yet. The independent insurance agency system faces constant competition for talent and for consumer market share—the fiercest of which comes from other insurance distribution channels like captives and direct writers, as well as other industries. An inevitable source of both talent and consumers is our black, Hispanic, Asian and other minority populations, and our fiercest competitors are pursuing them vigorously.

Attracting talent from minority populations is not much different than attracting talent in general. Agencies have a lot to offer to recruits, but we must do a better job promoting the virtues of an agency career path. We must stress that, depending on the job, employees may have an uncapped earning potential, flexibility, an abundant consumer market and complex products that are mandated by law, business or a conscientious mindset.

The lack of diversity in our industry can be a deterrent for minority recruits, but a supportive employer can turn it into an opportunity. Our fiercest competitors may seem “sexier” or more nurturing, but few can match the mix of manageable barriers to entry and opportunities the independent insurance agency system presents.

To enter a minority consumer market, a diverse workforce certainly helps, but agencies also need support from carriers to succeed. Carriers’ products work well with minority consumers, but we really need underwriting methodologies that better assess the risk today’s insureds present. Traditional underwriting models for preferred business tend to exclude the newly middle-class minority prospect with a limited credit and homeownership history. Incidentally, they may also exclude the millennials who have been living at their parents’ house until the age of 30.

For example, in the age of big data, Forbes reports that college loan financier Earnest has developed an innovative algorithm that uses 80,000-100,000 data points in order to lend to people with little or no credit history. Our industry must innovate similarly to help agents grow their businesses by tapping into diverse markets.

—Juan Padron, principal and partner, Safeguard Insurance
Chair, Big “I” Diversity Task Force