All Insurance Is Local
This recession is costing more than jobs; it’s also costing business leaders their reputation. A new Harris/ Financial Times poll shows that the economic crisis has damaged the reputation of business leaders very badly. Large majorities of the public in the U.S. and the five largest European countries (Great Britain, France, Germany, Italy and Spain) say their opinions of business leaders have become worse, that the recent behavior of “business leaders in general” has been unethical, and that they are overpaid.
Fully 68 percent of American adults say that “as a result of the current economic situation” their opinions of business leaders have become worse. Even more Americans — 76 percent — believe “the recent behavior of business leaders in general” has been unethical.
Fully 79 percent of Americans, and similar majorities in the five European countries, believe that business leaders “are generally paid too much.”
A majority (68 percent) in the U.S. believe that governments should claw back bonuses or pensions of business leaders whose companies have been bailed out with government money.
Massive majorities of the public in all six countries, including 87 percent in the U.S., say that securing the jobs of their employees should be a higher priority for companies than increasing their profits by cutting their employees.
So What?
As the pollsters themselves point out, the reputation of business and business leaders is “not just a beauty contest.” Low popularity can affect not only the public but also how elected leaders and governments handle business issues, how the media report business stories and how other interest groups interact with them.
Perhaps the most obvious effect for business leaders of being very unpopular is that it increases the likelihood of governments adopting what corporations might see as anti-business regulatory and taxation policies.
The leaders of the property/casualty insurance industry are not immune to the effects of low popularity of business leaders in general. Most consumers, lawmakers and media do not distinguish among the various segments (life, health, property, casualty) of the insurance industry. All lines are lumped together and, even worse, too often referred to as part of the financial services industry. Everyone is put in the same room with the Wall Street wonders, Ponzi schemers and bonus babies.
Also, like it or not, AIG is the face of the insurance industry these days. When the public thinks insurance today, it thinks AIG — and that’s not good. The public doesn’t think about Travelers, Farmers, Progressive, the sensibly-sized Super Regionals or the close-to-home domestic carriers as separate from the villains. All insurers are the same.
The common wisdom among political talking heads and their pollsters is that the public does not rate Congress very highly but at the same time most voters think their own representatives and senators are just great.
Rescuing the reputation of the insurance industry won’t be easy. American Agency System insurance companies are particularly fortunate they have independent agents and brokers representing them. The late House Speaker “Tip” O’Neill coined the oft-cited phrase, “All politics is local.” Americans may not like insurance companies these days but they still love their local insurance agent.