What do insurance professionals think about the ethics of their sector? A recent survey of over 3,000 members of ‘The Institutes’ in the US provides some very interesting insights. Here’s what I made of the survey’s findings.
84% of insurance professionals agreed or strongly agreed that ethics played “a large role in my day-to-day professional tasks.” That’s very impressive and points to ethics being seen as an everyday aspect of how these people go about their work.
And that obviously influenced the 92% of insurance professionals who saw themselves as ‘largely ethical’. Again, an impressive result, but it’s one that’s then somewhat undermined by only 45% of the public agreeing with them on that. That’s a significant difference and it mirrors what I say about corporate misconduct, that it’s largely down not to bad people doing bad things, but good people making bad choices. It seems that most insurance professionals see themselves as good people, but a large proportion of the public think they make bad choices.
Then there’s the 14% of insurance professionals who saw the number one reason for acting ethically as being ‘customers wouldn’t trust us without it’. That’s low and indicates that insurance professional realise that customers don’t really trust them anyway.
One figure that stood out for me was the 24% of insurance professionals working with colleagues they saw as unethical. That’s a big number, especially if you think of the 92% of respondents who saw themselves as ‘largely ethical’. Something doesn’t fit there and I don’t think it can be put down to respondents to the survey being self selective on ethical grounds. It’s more likely down to the habit of seeing other people’s ethical failings more easily than our own.
What should happen?
So what did these insurance professionals want to see happen in response? Most of them were looking to their firm to build a more ethical culture at work: 40% went for more leadership and 38% for more integration of ethics into business management. Only 8% wanted more ethical training and only 6% were interested in ethics featuring in their performance appraisals. This is perhaps unsurprising if the main hurdle to acting ethically is pressure to meet business objectives and deadlines, and the second main hurdle is unethical colleagues. Yet what those 8% and 6% numbers also seem to say is that most people were looking to others to take action, rather than themselves.
Confidence that things will improve is not high – only 52% of insurance professionals felt that the sector would become more ethical over the next ten years. A similar number felt that ethics in insurance hadn’t improved over the past ten years. It gives the impression that insurance professionals in the US simply accept that that is how things are.
When the survey did ask about what could be done to improve insurance’s reputation for ethics, most respondents saw the solution being in the public having a greater understanding of how insurance works. This implies that the problem is seen not to be in how the sector acts, but how the public understands what they do.
Does this indicate a responsibility blind spot? …if only customers understood more about insurance; if only my colleagues were more ethical; if only my firm set better objectives and deadlines? Might the solution lie more in all those good people recognising that they do occasionally make bad choices, and then taking steps to making better ones next time round? Of course insurance professionals with a strong sense of their own ethics don’t feel they need any training in ethics, but how else are they going to be better at making choices that the public sees as more ethical next time round?
Making better choices
In presentations I give on ethics and insurance, I often talk about recognising the different types of rationalisations that people use to make the bad choices they’ve made look better in hindsight. And I follow that up with some techniques on how to avoid making those bad choices next time round. For while I certainly believe in firms having robust and effective processes around ethics, I see the driving force for change lying more in individuals being able to reflect upon the issues involved, recognise what is the good choice and the bad choice, and then building up their professional integrity to ‘do the right thing’. And a good way of achieving this is centred around ethical dilemmas, which as a recent post pointed out, provide just the right mix of practicality and business relevance to resonate with busy insurance professionals.
This is a great survey, well presented. It shines a light on the strengths, and, in my humble opinion, the weaknesses of insurance professionals in the US. There are surely some lessons in the survey for the UK insurance community as well.