Study finds diversity progress neglects career advancement

Despite some diversity strides made over the past five years within the insurance industry, barriers still exist and only 43% of companies surveyed say they are committed to advancing equity, according to a new report. In addition, racial and gender bias is still seen as a top barrier to entry to the industry, and career advancement lags.

A new report, The Next Steps on the Journey, highlights diversity strides, barriers, and a few steps organizations can take to more fully achieve and prioritize their DEI initiatives. These highlights were discussed during a recent webinar hosted NAAIA.

Key findings

Among the key findings:

• Most survey respondents agreed that their organizations were committed to diversity (60%) and inclusion (61%), however less than half of those surveyed felt that their organizations were committed to advancing equity (43%) and equality (48%).
• Only about half of the respondents felt there was evidence of support of DEI strategies from management (50%) and CEOs (51%) at their organizations.
• Respondents identified the tragic murder of George Floyd and other Blacks/African Americans and People of Color as the catalyst for centering conversations on race, and the industry has responded with a host of new initiatives to address disparities. Respondents reported increased exposure from initiatives, specifically DEI-related training (57%), support for employee resource groups (35%) , and mentorship programs (21%). However, these initiatives have not translated into career advancement.
• A higher percentage of participants marked racial and gender bias as top barriers to entry to the industry over those surveyed five years ago.

Need for key changes identified

The survey asked respondents to identify key changes that insurance and risk organizations can make to more fully achieve and prioritize DEI.

The following are some of the recommendations received:

• Enhance recruitment and talent-identification initiatives, including greater focus on historically Black colleges and universities and institutions that have substantially diverse student populations. There needs to be a more intentional exposure of the industry and recruitment of Black/African-American men, particularly millennials and Gen Zers, the report said. There should also be an increased focus on the recruitment and promotion of Blacks/African Americans to officer-level roles.
• Address compensation and pay inequities, while increasing pay transparency.
• Increase levels and frequency of mentorships, providing more opportunities to network with executives.
• Launch formal sponsorship programs and offer support through the use of executive coaches.
• Intentionally recruit for, and retain senior/ executive talent through organizational partnerships and with community investments through non-profit and not-for-profit organizations.
• Increase Board diversity across all races and gender identities.
• Make DEI a strategic business priority, with transparent goals tied to business leadership.

Recommendations made

The report also offered several recommendations aimed at catalyzing conversation and action for risk and insurance professionals and practitioners, agencies, brokers, companies and NAAIA, as well as other related associations, councils and collectives that support the advancement, networking and development of Blacks/African Americans in the industry.

The following are some of the report’s recommendations for Black/African-American risk and insurance professionals:

• Demonstrate success. Attracting talent to the risk and insurance industry will depend on the full engagement of Black/African-American insurance professionals who can illuminate under-informed or unaware communities and constituencies about the opportunities in the industry.
• Seek and offer mentoring. Throughout the research, mentoring was mentioned as a critical factor for career success and satisfaction, the report pointed out. Individual professionals can articulate their respective needs for mentoring as well as provide mentoring to, and with, each other. Mentoring could become a fundamental component of NAAIA chapter and ERG programs, either in formal or informal settings, the report suggested.
• Get and provide exposure. Getting exposure and gathering knowledge about the industry can be an effective remedy to longstanding barriers for underrepresented groups. Individuals can consider their own social networks to foster partnerships to strengthen industry exposure, increase validity of career opportunities and encourage young people who choose risk and insurance as a viable and rewarding career path.
• Advocate for self and for others. Now more than ever, individual professionals must find ways and opportunities to take charge of their careers. The amplitude of tools and platforms should enable professionals to connect, compare notes and exchange ideas. The research revealed that most participants did not belong to any industry-related associations, which could be a hindrance to career progress and success. Expanding networks and deepening ties to the industry should be a top priority for all individuals, who should view membership costs as an investment in personal professional development.
• Facilitate introductions for employers and NAAIA to Black/African-American organizations can also foster engagement and collaboration, the report added.

Suggestions for employers

In addition, the report provided several suggestions for employers seeking to enhance their DEI initiatives. Among the recommendations:

• Avoid performative actions. DEI-driven activities and training emerged in response to the events of the last few years. However, many organizations are “checking the box”, i.e., they are undertaking noticeable, but not meaningful, initiatives.
• A thoughtful and careful review of DEI initiatives is an important first step in ensuring that they are not merely performative, but also require courageous conversations by several stakeholders about the purpose and intent of each activity or program, the report said.
• Turn barriers into gateways. With intention, employers should ensure that there are measurable DEI goals and outcomes visible at all levels of the organization. Measurements can include internal or third-party pay equity and workload-balance analyses or tying compensation to the successful implementation of DEI initiatives, especially at middle-managerial levels.
• Use leverage. More employers could leverage the vast networks of employees and ERG participants for recruitment and to influence internal mobility, as well as to increase levels of employee engagement. Often, employers underestimate the power of personal connections and references within minority communities, the report pointed out.

The study was commissioned by Marsh and conducted by Dr. Leroy Nunnery II, with participation from NAAIA and others in the risk and insurance industry. Primary research included 312 online survey responses, 25 interviews and seven focus groups conducted over a six-month period.

Ayo Mseka has more than 30 years of experience reporting on the financial services industry. She formerly served as editor-in-chief of NAIFA’s Advisor Today magazine. Contact her at [email protected]. 

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Ayo Mseka has more than 30 years of experience reporting on the financial services industry. She formerly served as editor-in-chief of NAIFA’s Advisor Today magazine. Contact her at [email protected].