If the insurance industry really wants to be a part of the future, they will need to improve the public perception of the industry by staying in line with The Insurance Bill of Rights as the best practices standard. There are no shortage of polls and studies showing the low rank of the insurance industry and insurance agents in public perception. Improving these perceptions with real actions will improve the value of insurance and will lead to consumers getting the coverage they need at a reasonable premium and ultimately will lead to a better future for the insurance industry. As Daniel Schreiber, CEO of Lemonade put it “if you strip it all down to the root cause, this is a business built on a conflict of interest …” from 3 reasons Lemonade’s CEO wants to disrupt the insurance industry.
There are many components covered in The Insurance Bill of Rights that will improve the value of insurance including simpler products, simplified underwriting, transparency, ethical behavior and having the insurance industry working on the same side as consumers. This is outlined well in: Insurance industry takes look at ethics to polish reputation.
Actions speak louder than words. And because insurance companies and insurance agents oftentimes talk about best practices rather than practicing them, sales of certain insurance products have decreased or been stagnant. The Department of Labor’s Fiduciary Rule is a start in the right direction and has already partially gone into effect with some insurance companies being fully committed to it while others are hoping that the continued reviews of the Rule will lead to components being taken out. And while this only applies to life insurance and annuities held in qualified retirement plans, the horse is out of the barn and it is only a matter of time before it impacts all types of insurance. The smart insurance companies and insurance agents will be the ones who get out in front by following The Insurance Bill of Rightsbest practices standard.
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