Same Old Story

Members of President Barack Obama's team are reportedly extending an olive branch to the “fat cats” in banking and on Wall Street who nearly ran this economy into the ground. That's fine and dandy, but when is a politician going to make a similar gesture towards the insurance industry, which has done so much better by society than its more reckless financial sector counterparts?

“I think [the Obama administration] is starting to realize that the way he talks about business isn't inspiring confidence in the economy and is actually having a negative impact on the system,” according to one banking official quoted anonymously in the Sept. 17 New York Post.

I don't normally swear by the Post's accuracy or objectivity, especially when it comes to stories about Democrats and President Obama. However, this wasn't the only place I heard about reconciliation.

The business community—reportedly sitting on a ton of idle cash—is afraid to start hiring due to the lack of certainty on taxes, regulation, deficits, inflation and economic growth. Thus, it makes sense to reach out to reassure those who must create the tens of millions of jobs we'll need to jump-start this moribund economy, right?

The Post quoted an unnamed individual to report that the administration called a major consumer bank, seeking to ease tensions. “They wanted to convey that 'we're all in this together,' and it wasn't 'us versus you,'” the source reported.

For the sake of argument, let's say reports about the White House trying to make nice with the financial community are true. For those of you working in the insurance industry, however, doesn't this make you wonder why there is never any such outreach from lawmakers to your critical branch of financial services?

Too often—indeed, at almost every opportunity—insurance is demonized, never given credit for the vital service the industry performs in the economy and society, as well as for how soundly it manages its business compared to banks with their toxic mortgages and Wall Street with its equally poisonous securitized products and credit default swaps?

I suppose the industry should be grateful its lobbyists conveyed the message to policymakers on Capitol Hill that insurance was not the problem in the recent economic meltdown. Insurers got off relatively easy in the financial services reform law.

Indeed, there are those in this business—such as proponents of a federal charter or at least a strong Federal Insurance Office—who are probably disappointed Congress did not go further with the reform bill.

Still, insurers more often than not are cast as villains in the political dramas that play out in Washington and most state capitals. And this shabby treatment extends beyond party boundaries—I don't recall President George W. Bush telling property insurers they'd done a heck of a job after Hurricane Katrina.

Why is it that Wall Street players and their colleagues in the banking sector are so often treated with kid gloves, while insurers get beaten up when just a small percentage of claims are disputed following a major catastrophe—or, at best, they're ignored when they perform well?

My contention has long been that if insurers don't want to be victimized by political opportunists, they should stop acting like victims. They need to get the word out that there is more to this industry than cute reptiles, funny cave men and cranky ducks.

Those marketing campaigns for GEICO and AFLAC are brilliant, but they serve a limited purpose. This industry needs the same kind of creative firepower targeted at confronting the public and its elected officials about how much good insurers do, and how vital insurance is to the smooth functioning of our economic engine.

What do you folks think?