'You can't argue with populism' – CEOs on clickbait and costs

Cost-of-living squeeze, politicking and instant gratification pose industry challenges

'You can't argue with populism' – CEOs on clickbait and costs

Insurance News

By Jen Frost

During an IBAO CEO panel, insurance CEOs and senior executives reflected on societal divides and the rise of populism, and what politicking, clickbait and increasing consumer costs mean for insurance.

“Right now we’re in a time with a rise in populism and rise of clickbait, and if you can’t say it in a few short sentences, people don’t pay attention,” said Paul MacDonald, Definity EVP, personal insurance & digital channels.

“You get clicks when you say ‘record profits’, you get clicks when you say ‘gouging’,” MacDonald told broker attendees in October.

Clickbait, instant gratification and the insurance impact of populism

The Definity EVP contrasted this with insurance’s “long cycle” nature and referred specifically to Alberta, where an auto insurance rate pause was cited by an insurance carrier with 16,000 customers in the province as the driving force when it signalled its intent to pull out of the market earlier this year.

“When I try to speak with the Alberta government I say, ‘please realize that decisions you’re making now will negatively impact this portfolio [for] the next two years’,” MacDonald said.

“These are multi-year problems, and we’re in an environment where people don’t think multi-year, they think about immediate satisfaction and gratification of a news article.”

A societal ‘divide’ – insurance, politics and the cost-of-living

Canadians have been feeling a cost-of-living squeeze, with the Consumer Price Index at 3.1% -- an improvement on September’s 3.8% -- on a year-over-year basis into October.

Meanwhile, inflation has driven up repair costs, resulting in an insurance costs impact.

Louis Gagnon, Intact Canada CEO, reflected on a societal “divide” that poses a challenge to insurance’s reputation.

“We’re sitting here – I am sitting up here - privileged and lucky to have and to do what I do, to not have any financial problems, being pretty comfortable, and I think everyone here in the room is probably safe,” Gagnon told broker attendees. “I think we’re going to get into a period where – and we feel it in different provinces right now – I don’t want to name a specific province, but there are politicians right now that are using this rhetoric to influence people and it creates an environment where discussion, and clarification of where we’re going, that’s very difficult.”

Gagnon said he did not have a “solution” to suggest but that the insurance industry should look to act as a good “citizen”.

Political barriers to insurance product reform

Gore Mutual CEO Andy Taylor mooted product reform as a way to navigate climate issues and costs, but pointed out political barriers.

“The products that we sell are the same products that we’ve sold for the last 25 years, there’s been some innovation, but on a broad scale we haven’t seen product reforms,” Taylor said. “Ontario auto is a perfect example of that, where what we’ve seen is there isn’t an appetite for product reform, it’s a politically tricky file for the government to take on, and so we’re navigating the same product, same challenges.

“It’s been broken for decades and we’re asking ourselves, how do we keep costs low when all the costs are increasing? So we just need to think differently about the future of insurance.”

Changing the insurance conversation amid clickbait barrage

Travelers Canada president and CEO Heather Masterson suggested that to change the conversation and rebuild its reputation, insurance could do more to frame itself in a positive light with the public.

“We are diverse and are highly competitive, that’s all good, but there’s a lot of common ground, common goals and common values that we all share,” Masterson said. “We have incredible stories to tell, we have just an amazing contribution that we’re providing to the economy, to communities, to people, to families.

“I don’t think that we do the job that we need to do [in terms of sharing positives], so we really do need to harness that energy, start getting that messaging out there, and together, we all need to amplify it.”

What are your thoughts on the impact of populism, clickbait and politics on insurance? How would you solve this challenge? Sound off in the comments below.

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