"All things being equal, people do business with, and refer business to, people they know, like, and trust," says business and networking expert Bob Burg. (Credit: Yevhe/Adobe Stock)
I recently texted a dear, old friend in Houston to wish her a happy birthday. Her spirits that day were less than buoyant: “My birthday is being spent with my house full of mold remediation … ripping out drywall.”
She explained that her home and neighborhood weren’t directly impacted by the deadly Texas Hill Country flooding over the July Fourth weekend. But my friend, a longtime educator, lost two students to the rushing waters that swamped a summer camp on the banks of the Guadalupe River. More than two dozen campers and counselors perished in the disaster, which caused a total of 137 fatalities (and counting).
My friend’s home still ended up with an insidious type of damage. “We didn’t know we had water in the walls until they were covered with mold,” she texted.
My natural next question: Will insurance help?
“Insurance to cover it has to be connected to a specific event and reported within 24 hours,” she relayed about three weeks after the catastrophic rains. “It’s such a massive scam!”
This was the point in our exchange when I became certain that she forgot what I do for work: I’ve covered insurance news for nearly a decade. But even in this capacity, knowing everything I do about policy exclusions and insurance-carrier loss ratios and economic constraints, I’m not prepared to defend the industry when longtime customers like my friend are left feeling battered by the claim process.
Around the same time as my disheartening text exchange, a nonprofit consumer advocacy group called Public Citizen published an article with the following headline: “As Insurance Policy Holders Pay Record Rates, Industry Executives Rake in Record Pay.” The piece was syndicated by news outlets worldwide. It read: “At nine of the top 25 homeowners insurance writers — comprising 24% of the market — 42 executives took home a collective $310 million last year, up 21% from 2022. That’s more than $7 million per executive, on average.”
The article continued: “Across the U.S. property & casualty insurance industry, which includes home and auto insurance, 2024 was a year of windfall profits, hitting an all-time high of nearly $167 billion, up 91% from 2023 and whopping 330% from 2022. Yet, 2024 was also a year of record-setting damage from climate-driven storms. In response, insurers jacked up premiums and withdrew coverage from some customers, and even entire states, where risks to insured properties threaten to trim their profits.”
That is a lot to unpack, and most certainly a black-and-white view of complex financial issues. But consider this sentiment alongside the trend dubbed “social inflation,” which labels insurance carriers as bad corporate actors who should pay to right societal wrongs via explosive lawsuit verdicts and settlements. Then layer on the insurance industry’s growing talent gap, and a rising block of young professionals looking for fulfilling, rewarding, socially-responsible careers.
Add to that the mainstream naiveté about the different segments of the insurance world; the public spectacle of United Healthcare CEO Brian Thompson’s fatal shooting; and shooting suspect Luigi Mangione’s anti-authoritarian martyrdom? It’s an understatement to say that insurance has an image problem!
The insurance image problem is nothing new. It stems from customers who feel like their business is transactional rather than relationship-based; confused about the intricacies of their coverage; and very publicly decry the perceived injustice of denied claims.
On the hiring front, recruiters also must battle the stereotype of insurance work as boring and redundant, and insurance agents as pushy, profit mongers.
One thing I know for sure after my decade in insurance news: Most people working in insurance are in no way reflective of the industry’s negative perceptions. They are hardworking and idealistic, and genuinely believe that theirs is a service-oriented mission to make policyholders whole after a major loss.
Most (if not all) of you also have been in romantic relationships. Those personal interactions bear relevance to the insurance image problem as great relationships bloom from trust, honesty, respect, open communication and effort. This knowledge should guide insurers in their policyholder interactions long before a customer needs to initiate a claim.
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