What do consumers really think about fraternals?
July 26, 2011Recently, I met with Keith Frederick of Frederick Polls, LLC, the consultant who will be moderating the Alliance’s series of four consumer focus groups to be held next month in Madison, WI, and Addison, TX. It’s been a while since I’ve been this excited about a particular project. This is the Alliance’s initial foray into consumer research, and this project has the potential to provide member societies with the tools they need to make themselves more relevant in the eyes of their current and, more importantly, prospective members. As we all know, the general public’s awareness of fraternals ranges between non-existent and misunderstood. And the words we use to describe ourselves – fraternal, local lodge, ritual initiation, common bond – are often confusing or irrelevant. The overarching objective of the focus group project is to provide member societies the tools – messages, words, phrases, descriptions – they need to reinvent the concept of a fraternal benefit society and better communicate the value of membership in a fraternal to prospective and/or existing members. Conducting qualitative research – focus groups – is the first step in this process. The results of the focus groups (and a follow-up national poll of consumers based on the focus groups’ findings) will be unveiled at the Alliance’s Annual Meeting. By the way, if you haven’t registered for the Annual Meeting yet, there is still time to get the early-bird discount rate by registering online at this link. Regulating the sinners… By now, you’ve no doubt heard about New York insurance regulators ordering all life insurers, including fraternals, to use the Social Security Death Master File to locate insureds who may have died and report on the effectiveness of the search. This requirement fundamentally shifts the responsibility for submitting death claims from the purchaser of the product (the policyholder, or in our case, the member) to the seller of the product. Like most regulations, this one was intended to address bad behavior in the marketplace. In this case, it seems that a few large commercial insurers were using Social Security information to determine the deaths of their annuity customers (presumably so that they could stop payments to these individuals) and failing to use the same database to determine the deaths of their life insurance policyholders (presumably so that they wouldn’t have to pay the death benefits). This is disingenuous at best and downright deceitful at worst. And the result is regulatory overkill that not only punishes the bad actors but the good ones, too. Unfortunately, that’s the nature of any regulation – starting with the 10 Commandments (compare the number of “thou shalt not” with the number of “thou shall” commandments and you’ll see what I mean…). Any industry – including fraternals – is only as strong as its weakest link. Random thought on the 10 Commandments: If we actually were able to stop coveting our neighbor’s goods, our entire economic system – driven by consumer-purchasing – may collapse… Does this song sound familiar?? Check out this story from the July 21 Wall Street Journal. Does this sound like disputes that play out on the floor of your society’s convention? While the story of the feuds between factions of the “Pearlies” is good for a chuckle, the reality is that these internal political debates are the biggest obstacles to the future success of individual societies and the system. Something to think about… Ending on a high note… We all know that petty turf wars like those described in The Wall Street Journal article are part of the fraternal system. The fraternal industry is miniscule in the grand scheme of things, but somehow we’ve got more fiefdoms that than medieval England – fiefdoms that some folks are willing to defend even if it means perpetuating inefficient operations, poor customer service, little or no growth, and the ultimate death of an organization. But there are those among us willing to overcome those hurdles. And Catholic Financial Life is just the latest in a growing number of societies that have taken bold steps to enhance their governance, streamline their operations, and position themselves for success. The society just completed a year-long and incredibly thorough effort to revamp its governance structure when 95 percent of delegates approved a referendum to clarify delegate representation, establish qualifications for Board members, and grant the Board the authority to hire and fire the society’s president. This represents a major leap forward for Catholic Financial Life and the fraternal system. Congratulations to Bill O’Toole, President and CEO; and Al Lorge, Senior Vice President, Secretary/Treasurer and CFO; and the staff and volunteer leadership of the organization for having the courage to tackle this issue head-on. Want to learn more about how they did it? Contact Al at firstname.lastname@example.org.