Speaking at the annual conference of the National Association of Mutual Insurance Companies (NAMIC, an ICMIF member), Andrea Keenan, Senior Managing Director, Strategy & Communications, AM Best, said mutual insurance companies have a built-in attraction for new talent because they are value-based organizations. Keenan spoke with AM BestTV at the NAMIC conference held in National Harbor, Maryland (USA) last week.
In the interview Keenan was asked why mutuals are so important to the fabric of society. In her reply she said: “Mutual companies are about people who get together for some sort of reason, whether it’s through beliefs, farming, or whatever it is that brings them together. They solve common problems, and that’s what insurance is meant to do. It’s meant to solve a common problem of protecting against risk”.
Keenan went on to say that this method of protection has been valuable for centuries, and it continues to have validity today. As an important mechanism of community and protection, the mutual sector, mutual insurance companies, and cooperatives, Keenan believes, have much to offer in awareness of risk, protection of risk, and pooling of risk. “It’s great for society. It’s great for the industry,” she added.
Keenan says that many of the NAMIC Conference delegates were asking AM Best about its innovation criteria: “There’s lots of questions about its potential impact, what it means for them, and what it means for companies that have very specific sectors and specific focus”.
She went on to say: “I’ve had a lot of opportunity to speak with companies about things that might be concerning them, and hopefully, making sure that they’re enthusiastic about what we’re taking on, and really understanding what we’re embracing. We really anticipate that they’re absolutely ready for this new innovation criteria to be implemented”.
When asked whether she thought mutuals can stay competitive for years to come, Keenan replied: “Mutuals have advantages over stock companies in some cases. They can have the longer view. They can make decisions based on what’s right for the company, not what’s right for this quarter for the stockholders, just in the ability to make decisions based on real, common business sense”.
She continued: “A board of directors can contemplate what’s right for the company, what’s right for the membership, and not necessarily a short-term gain. I think that the mutual model will continue for that reason”.
Keenan also touched on her belief that mutual have a lot to offer millennial talent saying: “As millennials come of age, as they are entering the work force, and as they have community values, I think that mutuals have a competitive advantage to attract that very large population into their fold, because they are values-based organizations. That entire generation is known quite well for having that as very high on their list of what’s important when they choose their carriers of any type of service”.
Watch the full video interview here.
AM Best is a Supporting Member of ICMIF and also a Gold Sponsor of the forthcoming ICMIF Biennial Conference which takes place from 12-15 November 2019 in Auckland (New Zealand). Andrea Keenan will attend the Conference and participate in a session entitled “Meeting key challenges, building competitive advantage”.