Making Diversity and Inclusion a Reality in the Insurance Industry

by | Mar 4, 2021 | Thought Leadership

Everyone benefits when an insurance company has a diverse, inclusive workforce, from employees and executives to partners, clients and individual policyholders. Unconscious biases, or stereotypes that we hold without even being aware of them, often keep our industry from achieving this.

I recently participated in a virtual panel discussion for Intelligent Insurer’s global Reinsurance Lounge series that tackled how to identify, understand, and eliminate unconscious bias from recruitment and talent development, as well as other aspects of the insurance business. I enjoyed an insightful conversation with my fellow panelists from around the world. Here are four highlights from our discussion:

1. Progress is possible, even in industries that are slow to change.

Every industry—regardless of its ethnic and demographic profile or its history of change management—has both an obligation to tackle unconscious bias and the ability to make a difference. As an example, consider a company whose CEO and senior management are mostly white males. By recognizing the potential for unconscious bias and intervening appropriately to remove bias from operations and processes, those managers drive change that will, over time, influence the actions of their peers and competitors. This, in turn, will ultimately yield larger systemic change.

Companies addressing unconscious bias are likely to hire a more diverse and representative workforce and to partner with diverse suppliers and customers. Many executives, including our own, are ready and willing to commit to diversity and inclusion and make them core elements of company strategy and planning. It does, however, take courage for HR leaders to start the conversations that help their executive teams identify and understand the unconscious biases they may be holding onto, despite their best intentions.

Unconscious biases based on age, gender and sexual orientation are perhaps the most obvious examples, but they are not the only areas of concern. For example, hiring decisions might be influenced by perceptions of educational background, favoring the candidate who is a graduate of an “elite” university over a similarly qualified and skilled applicant who graduated from a state school. This too is unconscious bias, and it may take several conversations for your executives to understand that a diverse set of educational backgrounds contributes to a diverse and more productive workforce.

2.Diversity & inclusion shouldn’t need to have a “business case” built for it.

We spent a lot of time during this panel talking about the idea of “building a business case for diversity and inclusion.” Many studies have, in fact, pointed out that more diverse workforces are better at problem-solving and are overall ultimately more profitable. But this shouldn’t be something that you have to “build a business case” around. When done well and done right, diversity and inclusion practices are intended to become part of the fabric of an organization, not stand alone as “one more thing” to check off on the to-do list that requires funding, approval, and bureaucracy.

3.Break it down into actionable steps.

Banishing unconscious biases and truly embracing diversity requires action. A company can’t just say “we’re committed to diversity and inclusion” without making any substantial changes to their hiring practices, community outreach, or workplace culture. Understandably, many companies are intimidated by the idea of a big, monolithic “diversity initiative.” What I recommend, for any HR leader in the insurance industry, is to look at your processes, and think about how you can break down actionable steps to improve them.

At Palomar, our recruitment process was one of the first places we looked. We always want to make sure we’re casting a wide enough net and eliminating unnecessary barriers to entry, in order to hire the best possible person for the job. Revamp your job descriptions to emphasize only the requirements that are truly needed for the job and distinguish those from the “preferred” qualifications like college degrees.

4.Diversity and inclusion initiatives should be employee-led and facilitated by a passionate executive.

Palomar’s leadership had prided themselves in creating a business where diversity and inclusion was truly part of the company’s fabric. However, after the events of this past summer, we realized that there was much more work to do before we could claim that.

This led to the creation of Palomar’s internal D.I.C.E. (Diversity, Inclusion, Community Engagement, and Equality) Council. The D.I.C.E. Council is not a top-down mandate, but instead an employee-led effort facilitated by passionate members of our executive team. Notably, instead of focusing on the big, broad issue of “diversity” within the organization, we’ve broken down the group into three distinct sub-teams: governance, recruitment, and internal/external partnerships and community engagement. Each of these groups focuses on fostering diversity and inclusion in that respective area of our business.

While D.I.C.E. is employee-led, we knew we had to create structure to ensure that the work is equally shared, and that everyone is working toward a common, concrete goal. Employee participation is voluntary, and every employee must pass an application and selection process before being named to the D.I.C.E. Council. There is a set time commitment per member per month, so no one employee is shouldering all of the emotional and logistical labor. My executive team and I also give D.I.C.E. a lot of support internally, frequently checking in on their advancement towards our stated objectives (for example, hiring applicants from a wider variety of educational backgrounds for certain positions).

While diversity and inclusion are noble goals for any insurance company, they require action. I was honored to be part of this important conversation for our industry and hope to continue it until our organizations better reflect the clients and consumers we serve.

Read more about Palomar’s commitment to racial and economic justice, and the DICE Council, in our inaugural Sustainability & Citizenship Report.

Subscribers to Intelligent Insurer can watch a video of the full panel discussion here.

Michelle Johnson

Michelle Johnson

Michelle Johnson is the Chief Talent & Diversity Officer at Palomar. She brings over 20 years of experience in HR leadership. Her mission is to cultivate a dynamic Palomar workforce while expanding the company's diversity and inclusion practices.
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