Commissioner Lara convenes insurance industry with call to action on increasing diversity

News: 2024 Press Release

LONG BEACH, Calif. — Advancing opportunities for small businesses in the insurance industry, Insurance Commissioner Ricardo Lara today led the 2024 Insurance Diversity Summit, bringing together executives, policymakers, diverse business and non-profit leaders, and other government agencies in a day of networking and community-building.

“My Department’s Insurance Diversity Summit is a gathering of leaders answering our call to action, backed by data, to drive meaningful change in the insurance industry,” said Commissioner Lara. “By collecting and analyzing diversity data, we create a path toward equitable representation and stronger outcomes for consumers.”

Under Commissioner Lara’s leadership, the Department’s nationally recognized Insurance Diversity Initiative has expanded its work to collect data and promote greater investment by insurance companies in a diverse network of suppliers. The insurance industry spends billions of dollars that can create opportunities for small and diverse business owners – including those owned by women, veterans, people with disabilities, LGBTQ+, Black/African American, Latino, Asian/Pacific Islander, and Native Californians.

Commissioner Lara’s policies are making a significant impact across insurance company boardrooms, where women now hold more than one-quarter of board director seats within the state’s $413 billion insurance industry, according to the latest data from the California Department of Insurance released today. For the first time since the inception of the survey, women comprise more than 25 percent of board directors among the more than 390 insurance companies that reported. 

Despite these gains, the survey found that approximately 15% of insurance company boards still reported zero gender diversity while Blacks, Latinos, Asian/Pacific Islanders, and Native Americans lag far behind their growing share of the nation’s population. As a result of a recently enacted California law sponsored by Commissioner Lara, this year’s survey expanded reporting to include board members who identified as a person with disabilities, and businesses owned by people with disabilities. In a stark contrast to the more than 7.7 million adults in California living with a disability, survey data indicates that the industry still has a long road ahead when it comes to disability inclusion in the boardroom, with only 0.35% of insurance board directors who identified as having a disability in both 2022 and 2023.

Representation among board directors who identified as LGBTQ+ experienced only a fractional percentage gain from the prior survey data with reported LGBTQ+ board directors comprising approximately 1%, compared to more than 7% of adults who identify as LGBTQ+. This data continues to underscore the need for more inclusive practices that expand representation on the boards of insurance companies.

Insurance company spending with diverse-owned businesses reached more than $3.1 billion in 2023. For several years, Commissioner Lara has sponsored legislation requiring insurance companies to have greater transparency to measure progress on their diversity goals.  

“While there’s progress, there’s still ample opportunity for insurance companies to meet their supplier diversity commitments in light of the disparities that persist among businesses owned by people from historically underserved communities,” Commissioner Lara concluded. “Now more than ever, we need leaders at the helm who reflect the people who live and work in the most diverse state in the nation.” 

In keeping with the Summit’s theme of “Harnessing our Impact,” the Diversity Summit’s welcome plenary included remarks from California Secretary of State Dr. Shirley Weber, California Senate Majority Leader Lena Gonzalez (D – Long Beach), City of Long Beach Mayor Rex Richardson, and President and CEO Maria Salinas of the Los Angeles Area Chamber of Commerce. Commissioner Lara followed up with a keynote conversation alongside Telisa Yancy, Enterprise President of American Family Insurance Group, focusing on sharing best practices that drive financial inclusion and equity for the insurance industry.

Attendees participated in business matchmaking roundtables and webinars led by experts on the topics of pathways to board leadership, best practices on disability inclusion, how to contract with insurance companies, the latest information on the state’s funding opportunities available for diverse business enterprises, and how businesses can stay ahead of the curve by gaining insights on navigating emerging topics such as generative artificial intelligence in the insurance industry while protecting consumers. 

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Media Notes: 

• California is home to the nation’s largest insurance market, with $413 billion annually in premiums from Californians. The law requires Californians to purchase many types of insurance, including health insurance, automobile insurance, and workers’ compensation insurance. 
• Additional information about the Insurance Diversity Initiative is on the Department’s website.
• While the nation’s Latino population topped 19.1% in the U.S., their underrepresentation in the boardrooms of insurance companies continue to stagnate at roughly 3.4% in 2022 and 2023. While Black/African American communities make up the second largest racial and ethnic minority population in the United States at 13.6%, only 8% of boards included Black/African American board directors. 
• Asian/Pacific Islander board directors continue to be disproportionately underrepresented on insurance boards, accounting for just over 5% of board seats, whereas the Asian and Pacific Islander community collectively represent about 6% of the nation’s population. Yet, the continued absence of board directors identifying as Laotian, Cambodian, Vietnamese, and underrepresentation of Pacific Islanders point to the acute disparities that persist within the Southeast Asian and Pacific Islander American communities.