What’s your “innovation” rating?
How would you assess your society’s innovation skills – your ability to “transform ideas into new or significantly improved products, processes, or services that enable the organization to remain relevant and successful?”
Beginning this year, A.M. Best will factor an innovation score into its rating mechanism. And while the rating agency “does not expect any changes to ratings as a result of this criteria procedure, it is a significant sign of the times when it comes to assessing an insurer’s overall health and sustainability.”
You can read more about the innovation scoring and assessment here . I’ll be attending the A.M. Best Review and Preview Conference this week and hope to learn much more about it.
Never mind the fact that only a handful of fraternals go through the A.M. Best’s rating process, the addition of an innovation factor should send a message to every insurer – fraternal and commercial – that a seemingly healthy balance sheet is not the only thing on which your executive team and board needs to focus. It’s a little like a snapshot of a happy family on a whitewater trip – without taking into account that the raft has no life jackets and a 100-foot waterfall is around the next bend.
The ability to innovative is the lifeblood of any business. The life insurance sector is one of the world’s most conservative and traditional businesses – and fraternals occupy a uniquely conservative and traditional niche within that sector. For the times they are a-changing – whether we acknowledge it or not.
So, while the new A.M. Best’s innovation evaluation may not affect your society, your members’ and prospects’ innovation score certainly will. As A.M. Best’s points out: “With the increased pace of change in society, climate, and technology, innovation will become increasingly critical to the long-term success of all insurers.”