Setting a new standard: Commissioner Lara launches inaugural Insurance Diversity Index

News: 2023 Press Release

LOS ANGELES — California Insurance Commissioner Ricardo Lara today announced the launch of the inaugural Insurance Diversity Index, a groundbreaking benchmarking tool designed to foster diversity, equity, and inclusion (DEI) in California's insurance industry. Initial findings of the trailblazing initiative were unveiled at the 2023 Insurance Diversity Summit.

"The Insurance Diversity Index represents a significant step forward in our ongoing efforts to create a more equitable and inclusive insurance industry,” said Insurance Commissioner Lara. “By providing a clear benchmark, we can inspire positive change and ensure that California consumers are served by companies committed to diversity and inclusion."

The Insurance Diversity Index – spearheaded by the Department’s nationally-recognized Insurance Diversity Initiative and its Insurance Diversity Task Force - is a crucial initiative aimed at increasing transparency, measuring progress, and encouraging accountability within the insurance sector. By gauging insurance companies' commitments to policies and practices that advance DEI in three key areas - diversity in the corporate boardroom, supplier diversity, and California community impact investments - the Index provides valuable insights into the industry's efforts to promote diversity and inclusivity.

“Transparency and measurement are essential in holding the insurance industry accountable for its diversity commitments,” emphasized California Attorney General Rob Bonta. "The Insurance Diversity Index will empower consumers and stakeholders with information to make informed choices and drive progress."

Commissioner Lara’s sentiments are shared by leaders on the Department’s Insurance Diversity Task Force, including newly-elected Chair Mark Morales who said: “This Index means that consumers can be better informed about their spending power, and it encourages insurance company leaders to match their intentions with actions.”

Key Highlights of the inaugural Insurance Diversity Index:

• Levels of Distinction: Using a 100-point scale, companies can earn Bronze (61-70 points), Silver (71-80 points), Gold (81-90 points), or Platinum (91 – 100+ points) levels of distinction.
• Setting the Tone at the Top: High-performing companies prioritize diversity, especially in their corporate boardrooms, demonstrating a commitment to intentional policies and practices.
• Investing in Supplier Diversity: Leading companies recognize the value of supplier diversity and maintain robust programs and policies to support diverse businesses.
• California Community Impact: Companies are evaluated on their contributions to historically underserved communities in California.

The full 2023 Insurance Diversity Index Report was made available to attendees at the Insurance Diversity Summit held in downtown Los Angeles. Members of the public can download the report starting October 13 at www.insurance.ca.gov/diversity/.

The annual Summit is a free, dynamic event, featuring insightful speakers, matchmaking opportunities, and an extensive resource expo. Attendees have the chance to learn from industry leaders, explore opportunities for business growth, and engage in discussions that drive DEI initiatives forward.

The Summit’s welcome plenary also included leaders of the Insurance Diversity Task Force – Chair Morales and Vice Chair Rebecca Aguilera-Gardiner; Evelyn Boswell, Director of Diversity, Equity, and Inclusion for the National Association of Insurance Commissioners, and Tracy Hernandez, founding CEO of BizFed. Linda Akutagawa, CEO of the Leadership Education for Asian Pacifics, moderated a keynote discussion between Commissioner Lara alongside Paul Markovich, Blue Shield of California’s CEO to highlight best practices that set the pace for diversity, equity, and inclusion in the insurance industry.

About the California Department of Insurance

The California Department of Insurance is the consumer protection agency for the nation's largest insurance marketplace. It regulates the insurance industry, protects consumers, and promotes diversity, equity, and inclusion within the sector.

For more information, visit www.insurance.ca.gov.

About the Insurance Diversity Initiative

The Insurance Diversity Initiative is dedicated to advancing diversity in corporate governance and increasing procurement from diverse businesses within California's insurance industry.

For more information, visit www.insurance.ca.gov/diversity.

About the California Organized Investment Network (COIN)

COIN is a national model for increasing insurance industry investment in underserved and rural communities throughout California, promoting economic growth and community development.

For more information, visit www.insurance.ca.gov/COIN.

About the 2023 Insurance Diversity Summit

The 2023 Insurance Diversity Summit, themed "Setting the Pace," is a free, hybrid event hosted by the California Department of Insurance. It offers a platform for education, networking, and opportunity sharing in the field of diversity, equity, and inclusion within the insurance industry.

For more information and registration, visit www.tinyurl.com/2023DivSummit.

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Media notes:

• The insurance industry collects $409 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.
• The national insurance market is $2.7 trillion.
• Additional information about the Insurance Diversity Initiative is on the Department’s website.
• Using demographic data from the 2020 U.S. Census, ethnically diverse board members continue to be underrepresented in the boardrooms of insurance companies. 
• While the nation’s Latino population has grown to nearly 19% of the U.S. population, their representation in the boardrooms of insurance companies stagnated at 3.4% in 2020 and 2021. Among Black and African American communities that make up 12% of the U.S. population, only 7% (2020) and 7.8% (2021) of boards included Black or African American board directors, according to the Department’s 2022 California Insurance Diversity Survey.
• As a whole, Asian/Pacific Islander board directors continue to be disproportionately underrepresented on insurance boards, accounting for only 3.8% (2020) and 4.4% (2021) of board seats, whereas the Asian/Pacific Islander community collectively represent about 6% of the nation’s population.
• In particular, the absence of board directors identifying as Laotian, Cambodian, Vietnamese, or Pacific Islander are glaring reminders of the disparities that linger within the Southeast Asian and Pacific Islander American communities.