Racial/Sociological Question

I’ve recently started a job as an insurance agent, and there’s a phenomenon here that everyone seems to agree is pretty much a fact: Black customers are tough to sell, and even tougher to keep. The managers I’ve asked have told me that for some reason it’s just very hard to actually get a check out of black couples for life insurance, and once you do, it’s very hard to keep them on the books.

I don’t believe these guys are just bigoted. This is their actual experience. Now, I fully admit that I’ve had the same experience with whites already. There are some whom I could smack for being so double-minded. The thing is that I’m told that the percentage of cancellations is much higher among our black clients. One manager has gotten to the point that if he has a black couple scheduled, he might double book that time if he has nothing else to give another client whom he’s scheduling. His theory is that people are writing out checks, and then when they can’t make the second or third payment, because they never should have agreed to that amount anyway, they cancel.

NOW, I don’t want any crap explanations like those that might have come out of that BrianMc guy who got banned. I’m assuming this is a cultural/sociological issue. I’ve been on very good terms with a number of black people at various times, and people in general are just people; we’ve all just been raised differently. I’ve taught school before where I was one of only three white teachers on the staff, and one of those was the kind to make me ashamed of being white, she was such an idiot.

Anyway, any guesses as to what might be going on with this?

This sounds like an issue related to socio-economic status more than race. Do black customers cancel their policies at an equal rate regardless of income? How about whites, Asians, or Hispanics?

In other words, there are other possible factors to check besides skin color.

I think bordelond may be right. It’s entirely possible that people of lower means are more likely to back out of an agreement when they realize how much it is going to cost them especially when weighed against future benefits. The reason why you may see so many of these people being black could be because there are such a high percentage (roughly 25%) of blacks below the poverty line. link.

However when you look at that link as a percentage of total people below the poverty line whites outnumber blacks by almost two to one which then raises the question why you don’t see many more white people not handing over checks. It may very well be that you do but since as a percentage of total white people so few are below the poverty line (6%) they are only a small percentage of all the white people and are thus overlooked. If poverty can be used as an indicator (which it probably can’t with perfect accuracy, but for this exercise I’m gonna anyways) 1 in 4 black people are likely to not hand over a check whereas only 1 in 17 of the white people are. If you’ve got 1000 white people and 100 black people walking into your office there are more whites than blacks not handing over a check (do the math). What all this shows is that the phenomenon you’re seeing may be economic, however since so many people of lower economic status are African American it may be a phenomenon more often witnessed with AA’s. In other words it is not necessarily an ethnic trait.

Then of course it may just be smart on certain clients’ parts not to take out a life insurance policy. With African Americans leading all other ethnic groups in terms of mortality rates they may simply decide that it may not be worth their time. That however is a WAG which I doubt.

And then of course it could be geographic. Whites and blacks tend not to congregrate in terms of living areas and nor do people of differing economic status. What you often wind up with is people of a given ethnic group and economic status living together in clumps. Your office may be near an African-American neighborhood of lower economic status and also a predominately white neighborhood where people of higher means are living. This would explain why you see so many black people canceling or not picking up health insurance versus white people: the black people in your area on the whole may not be able to afford it.

Oh, and your that manager double booking? Unless he has some way of seeing both clients if they show up he’s a sterotyping prick.

Not to mention that without hard stats, this is still just anecdotal evidence. For all we know it could just seem to some agents like the black customers are harder to keep.

I agree with what’s been said thus far, and am inclined to believe that economics is a huge factor. However, if you want to think of it as a socio-cultural issue, here are a couple of theories:

a) Black people have historically been denied The Good Life, as it is defined by wealth and material goods. Therefore, whereas a White person might be more inclined to want to protect the wealth, a Black person might be more inclined to want to show the wealth. And what do you have to show when you buy an insurance policy?

Just today I attended the funeral of a White man who lived next door to my parents for over 30 years. Drove an old car, lived in a modest home, and he and his wife quite often ate cold cereal or bologna sandwiches for dinner (unless, of course, they could smell our grill going on the other side of the fence…). One of the things that was said about him at his funeral today was that if he invited you out to dinner, you knew to bring money with you, because he’d inevitably “forget” his wallet every time.

Dude was a millionaire.

My parents, meanwhile, were NOT millionaires (though they did OK), yet each of my siblings and I had a new car for HS graduation, we threw great parties, ate steak for breakfast… in other words, we SPENT our money. My dad grew up on welfare, and was determined not only that his kids should have “The Good Life,” but by golly, people were going to know about it.

Of course, he also had a life insurance policy, but that’s not the point. Point is, if there’s a choice to be made as to how to spend money, a Black person might be more likely to spend it on something tangible.

b) Black people have historically been quite accustomed to “hard times”, as it were, so the idea of Dad (or Mom) kicking off without leaving behind a hunk of money is not really such a nightmarish scenario. I’m not saying that White people are weaklings who can’t handle a shitty situation, or that Black people are pessimists… But when shit happens, a Black family might be more likely to say “Well, them’s the breaks,” and keep on keepin’ on than they would be to say, “Dammit! Why didn’t we take out that insurance?” since they have not historically been accustomed to such luxuries.

c) For well-known historical reasons, Black people may not be as “trusting” as Whites. And, um… no offense, but surely you know that insurance salesmen rate somewhere just above lawyers on the Stereotypical Scale of Trustworthiness.

d) Re: Item (b), Black people are also more likely to be able to rely on a support group of friends and (often extended) family to help out in crappy situations.

Just my opinions, and take them for what you will…

Asylum and auntie em make some great points. I’m just wondering if there isn’t an element of “self-fulfilling prophecy” in this, like the manager who double books when a black couple is scheduled. When he sets up the appointment with the black couple, how serious does he sound? Does he make it sound optional, because he doesn’t expect them to show up anyway?

Do you really give the exact same sales pitch to black couples and white couples? Does your agency sell black couples and white couples the same way? Are some of the benefits (and responsibilities) of insurance that you point out more applicable to white couples than black couples? Do you even subconsciously make the black couples feel that they probably won’t be sticking with the payments, or that insurance really isn’t for them?

I have experienced some real horror stories involving black people buying life insurance, so I think it’s worth considering the possibility that it’s the agents who are producing any apparent discrepancies in behavior.

Odd.

I don’t know if it’s a regional thing, but in TN, black folks are considered an easy sell. I am about as NONracist as anyone, but I’ve always heard from the agents that black people pay the insurance man before anyone else.

I’m not in insurance, so I can’t verify this.

I have known many people of many colors on many levels.
I’ve found that socio-economic status is a MUCH bigger factor than race in any subject you wish to discuss.


my .02,
TN*hippie

You brought back unpleasant memories of the time I was so desperately hard up for a job I tried being a salesman cold-calling to sell pots & pans. That lasted about a week although I never sold anything! There were two different forms to fill out for the customers. I asked what the second one was for and they said it was for Black customers. This was in 1982 in St. Louis. I was so nauseated at their racist policies I quit immediately.

Well, he would be if he just didn’t show up. Actually, I have to say that I’m not sure he’s actually ever done this at all, but the idea was to check on the second appointment and then reschedule the first one. I know what you mean about stereotyping, but if you noticed that something had a very low probability of making you money, wouldn’t you let something else take precedence?

Yes, we do. Atleast, I have no reason to believe that other guys are doing anything differently, and I certainly am not. Granted, my experience with anyone or anything in this field is very limited, so my actions are not a good sample as to whether it matters if you act exactly the same. At least the one black couple I’ve seen had the decency to not buy instead of calling me days later, like has already happened with three white customers.

I suspect this is the heart of the matter right here.

From Asylum’s link about mortality rates:

What this means is that black people should be buying insurance like mad. The insurance companies are not allowed to rate people based on race.

What actually happens of course is that people of any color who are most likely to die early are also the ones not thinking of insurance, or unable to afford it.

I am wondering if your coworkers/managers only remember a customer “back-out” when the customer is black. Many folks only remember incidents when it fits their preconceived notions, and ignore/forget the rest, and develop a skewed perspective as a result.

<hijack, tertiary to topic> I must confess that I am intrigued (and appalled!) by this. Can you tell us how the forms differed? Or were they handled differently from an admin stance?</hijack>

No. He’s still judging the people before they show up. His assumption is that since they are black they are likely to not show up. The problem here is that these are individuals he’s dealing with not a group, and individuals deserve to be judged as such. And even if it were a group they should get the benefit of the doubt. Double-checking to make sure they show up does not alleviate this unless he does the same with all of his clients. Even though you may be able to work up a viable, profitable business model or practice based in some part on the judging of people by race that does not make it ethical.**

Thank you for pointing this out to me. I should have assumed that insurance companies would not be allowed to rate according to race but wasn’t thinking fully.