The National Association of Insurance Commissioners' Special Committee on Race and Insurance had its first structured meeting on Sept. 17, as it introduced its formal charges and split into five separate workstreams.
South Carolina Insurance Director and NAIC President Ray Farmer said in an interview that "everything is on the table" in terms of concrete actions that the committee might take to address issues of diversity and potential discrimination in the insurance industry, but declined to comment on specifics.
"It's time to put actions to our words, and that's what we're doing," Farmer said.
The special committee is charged with conducting research and analyzing diversity and inclusion across the industry, with particular emphasis on potential practices or barriers that may disadvantage people of color and historically underrepresented groups. The NAIC is pushing to have recommendations ready for its executive committee by the end of the year.
The first two of the five workstreams deal with examining the levels of diversity and inclusion within the industry and among regulators. The remaining three will look at potentially discriminatory practices or other issues that make it harder for people of color to access insurance products in major business lines.
Birny Birnbaum, executive director of the Center for Economic Justice, during the Sept. 17 meeting spoke about what he sees as the four barriers that have slowed or prevented progress to date. He recommended that the committee thinks about a "more useful way" of looking at "inherent racism" by looking at different parts of the insurance life cycle instead of breaking it down to separate lines of business.
"Examining issues of inherent racism in pricing, claim settlement, anti-fraud and insurer investments cuts across lines of business," Birnbaum said. He also called for the NAIC to be more proactive in reaching out to bring more consumer advocates to the conversation and providing them the resources to participate.
American Council of Life Insurers President and CEO Susan Neely shared possible "concrete steps" that could be taken to advance economic empowerment and equity. Among those ideas, Neely mentioned expanding access to affordable financial security protections, advancing diversity, equity and inclusion with companies and on corporate boards and expanding education for, and investments in, underserved communities.
The insurance talent pipeline was also a central topic of discussion as the industry is facing an executive talent crunch with many older executives looking toward retirement without a steady stream of younger talent to replace them.
Tony Cotto, director of auto and underwriting policy at the National Association of Mutual Insurance Companies, emphasized a diverse culture as being essential to the long-term success of the industry. He suggested having an "insurance row" at job fairs where insurance companies, regulators and others work together to recruit talent.
Florida Insurance Commissioner David Altmaier, who is co-chair of the Special Committee on Race and Insurance alongside Farmer, said he expects to hold a call in the near future to discuss a timeline with the working group co-chairs.
"We have a lot of work to do from now until the end of the year to come up with recommendations for the executive committee," Altmaier said.