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Posted by Eden Stewart ● March 29, 2022

The Ethics of Diversity and Inclusion in the Insurance Industry


Recall the last time you encountered someone different from you. Did you learn something? Perhaps you were challenged with a new perspective, or with new information. Maybe you were introduced to a different skill or culture. In any of these instances, you benefited directly from the positive impacts of diversity. As a term, diversity highlights the qualities that make us unique. We each have varying social identities, experiences, and backgrounds that affect our values and priorities in life.

Understanding a client’s perspective and background is integral to an insurance agent's success when working to meet their needs and serving their best interests. Clients need a professional who appreciates their uniqueness, recognizes how that individuality shapes and influences their goals and desires, and then matches financial services or insurance products to work in their best interests. Insurance agents ultimately bear some level of ethical responsibility toward their clients. When considering the fulfillment of these duties—and an agent's dealings with a client—the subjects of diversity and inclusion can be viewed from an ethical perspective.

What is the meaning of ethics?

The subject of ethics largely deals with morals, such as what is considered “right” or “wrong” or “good” or “bad.” The concept of acceptable or unacceptable behavior is generally influenced by legislation and rules, and also by the cultural standards and expectations of our society. Many industries follow basic ethical obligations set forth by society and legal institutions, but each industry has differences—large or small—that impact how ethics can be interpreted.

In the insurance sector, the ethical obligations of a licensed agent are often shaped by the laws and regulations they are bound to uphold, and extend in all directions to the agent's insurer, clients, and the public. These standards are also specifically tailored to the profession as a whole. This is reflected in the ethics courses you are required to take, and the laws and guidelines you must follow. For instance, some states require licensees to take ethics courses that promote professional growth as a means of improving the profession. So when thinking about how the profession can be improved, it is crucial for diversity and inclusion to be understood, supported, and practiced.

How are diversity and inclusion ethical issues?

Understanding a client’s cultural background and social identities can provide valuable insight when making suitable recommendations. Each client’s personal circumstances, risk tolerance, goals, and interests are already accounted for during the recommendation process as part of most standardized best interest and suitability worksheets. On the other hand, if an insurance agent and client are unable to comprehend each other’s perspectives, the client’s goals and priorities may be neglected or misinterpreted. A key component of the client-agent relationship is trust. What if certain words are perceived as offensive by clients? Will they still trust the agent's understanding and prioritization of their best interests? Could they feel like their unique needs are being dismissed or invalidated?

Diversity and inclusion are rooted in the very foundation of the client-agent relationship, and are important to ethical interpretation. Insurance agents who exhibit inclusivity in a professional manner are directly serving the needs of consumers.

Because of its direct ethical implications on the duties of insurance professionals, this topic has received increased attention within the insurance industry, at both the state and national level. Diversity and inclusion training, resources, and education are more available now than ever. When insurance agents value the individual differences of each and every consumer, they are more inclined to seek out this education as a part of their professional growth, and as a part of their efforts to improve the insurance profession. The continued pursuit of product knowledge is an essential aspect of an agent's duty; however, understanding the importance of an inclusive mindset in our vastly diverse marketplace is arguably just as important.

Where can I learn more about diversity and inclusion?

To learn more about the different strategies and methods of practicing inclusivity, current industry initiatives, and how to serve a diverse population, licensed agents can attend A.D. Banker’s Diversity, Inclusion, and Bias Elimination webinar for insurance Continuing Education credit. Browse our course catalog for a complete list of our online courses and webinars.

Topics: Insurance, Continuing Education, Ethics

Continuing Education Webinars: Live online "classroom" courses... NO EXAMS!