Women are moving into strategic leadership roles in insurance, driving innovation and culture | Mandira Gupta | MD and Mergers & Acquisitions Head – India, Middle East & Africa | Howden India

Insurance has long reflected societal norms: a healthy ingress of women into the workforce often encounters the middle management “pinch”, feeding into stark leadership underrepresentation. This historical male dominance in strategy and decision-making, however, is finally seeing a gradual change. The conversation is shifting from a mere moral obligation to a strategic business imperative. As more women ascend to the C-suite level and boardrooms, their agency is increasingly guiding the company cultures and customer impact, benefitting the entire ecosystem.

Risk and Trust: Cornerstones of the Insurance Industry
The raison d’être of our industry is risk management. The sector, by definition, is required to be stable and solvent even when the world around it is mired in crisis.

Multiple studies indicate that men and women, as cohorts, have contrasting approaches towards risk. Men, generally speaking, tend to take more and bigger risks, while women deliberate negative outcomes – including social costs of the said risks – a lot more deeply before action. In the modern marketplace, both lines of thinking have their utility – an organization or industry without an appetite for risk taking will drift into obsoletion while one without checks and balances courts disasters. The inherent nature of insurance, therefore, makes it imperative to have this diversity in thought process at the strategic level.

A unique feature of the insurance industry is that our services are needed during our customers most stressful or tragic hour – no insurance policy gets triggered when things are alright. Accordingly, the industry is required to have compassion and empathy.

Once again, at a population level, men and women show differences in their empathetic responses. Women tend to score higher on affective empathy, i.e. feeling sad when a friend is sad, while men have a higher tendency to exhibit cognitive empathy, i.e. knowing why the said friend is sad. Adequate diversity in the insurance industry leadership allows for the creation of policies and products that pre-empt customer needs, while simultaneously offering a viable balance between policy outcomes and the firm’s profitability.

Market opportunity: the changing customer landscape
The financial decision making of an Indian household has historically been the domain of the male population. This dynamic is perfectly encapsulated in a Franklin Templeton advertisement where a son fails to comprehend financial advice from his mother until she dons a man’s voice. The advert ends with message that “Women = Men in financial advice too”, highlighting a bias that is rapidly eroding.

The Female Labour Force Participation (LFPR) rose to 41.7% in 2023-24, up from 23.3% in 2017-18. As the number of working women increases, so does their influence in personal and household finance. Not surprisingly, a 2024 DBS study found that 47% of women today take financial decisions on their own, and this ratio improves to 65% among the cohort of women above the age of 45.

Even at a household level, the female influence is on the rise. Women’s decision making in financial investments and retirement planning now stands at 26% and 14% respectively – both areas of interest for the insurance industry.
The best way for the industry to increase market penetration and higher adoption is through product innovation and improved customer connect, and both of these can only be enhanced by having higher leadership diversity amidst this shifting market composition. The business imperative of having more women in the C-suite has never been higher.

We are moving in the right direction
It is heartening to see that the government, the regulator and the industry alike have all taken cognizance of this shifting landscape and have introduced measures to improve the gender balance in the industry.

• IRDAI’s initiative for women-led ‘Bima Vahak’ agents to boost rural penetration tackles this at a grassroot level.
• ICICI Prudential Life Insurance’s ‘Sparkle’ programme, an internal employee-policy aimed towards helping new mothers returning from maternity, is an excellent example of an attempt to tackle the ‘pinch’ in the middle.

• Aditya Birla’s ‘Springboard’, meanwhile, looks to address the problem at the top with curated leadership development program for senior-management women.

• Finally, the Companies Act of 2013 mandates that certain companies (most insurance companies fulfil the definition) must appoint at least one-woman director on their board.

The above are just instructive examples from an ecosystem that is fast adopting to the changing face of workforce and customer in the Indian financial services industry.

The Path Ahead
Despite the positive strides, women’s representation as CEO’s and in senior executive roles in India’s insurance/BFSI sector remains low, with significant gaps persisting. Women constitute 27% of the insurance industry’s workforce, lower than the India’s female LFPR. The difference is amplified as we move up the ladder – women have a single digit CEO representation and a similarly low hold in CXO positions. This highlights that the industry is plagued both by a smaller talent funnel at the start and a leaky pipeline running to the top.

Bias, stereotypes and most importantly, the motherhood penalty remain significant hurdles to be tackled. Training and awareness programs for all employees is a key step towards changing the mindset, but this must be supplemented by a push to include women in all possible roles. Cross-functional rotation programs are a great way to pilot such interventions. Furthermore, large companies should lead the way in providing policy and logistical support to allow women the flexibility they require to effectively manage their twin roles of motherhood and employment.

Equally important, we need to foster a culture of sponsorship to open up long and rewarding careers for women. Senior leaders who actively advocate for and nominate women during succession planning, award them high-impact assignments, and enhance their general management responsibilities would go a long way towards achieving the goal of a steady gender balance across the corporate chain of command.

A virtuous cycle
If the industry commits to continuing the path of structural reforms directed towards enhancing gender diversity, I have no doubt that the next decade would be transformative. With women holding a higher influence on aspects across product design, marketing, risk evaluation and customer engagement, the technically competent pool of women available for the senior-most roles will dramatically improve. A higher CXO representation by women, in turn, will inspire more women to join the industry, and a higher share among those will stick around for longer, rewarding career paths. The resulting virtuous cycle will ensure that the insurance industry remains well-served by the enduring benefits of diversity in workplace and leadership.