Picture: President Lyndon B. Johnson meets with Martin Luther King, Jr. in the White House Cabinet Room. Yoichi Okamoto via Wikimedia Commons.
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------ You know that strange phenomenon that happens when you learn a new word?
Suddenly you start seeing it, or references to it, everywhere.
The new thing seems to be on the front of newspapers, on the side of buses, on restaurant menus, literally everywhere you look!
Well, psychologists have noticed this too and these days there are names for it: the Baader-Meinhof Phenomenon, or the frequency illusion.
You see, it’s not that the thing has suddenly started appearing everywhere. It was always there. The only change is now that you value and understand the thing in question you start to be able to recognise it.
From then on it becomes highly visible and the frequency of its daily appearances undergoes the illusion of increasing very quickly. You always used to encounter it all the time, but you just ignored it because your brain decided it wasn’t relevant.
You see, us humans are really good at filtering out things that we don’t think are important. It helps us survive in a complicated world.
With limited time and resources we need to focus to get things done.
With luck the insurance sector is finally undergoing a Baader-Meinhof moment in relation to its many cultural failings over bullying and sexist and sexually inappropriate or abusive behaviour.
When a new wave of post-Weinstein #Metoo revelations started to break on the sector in 2017, it caught most of the industry by surprise, including us supposed investigative insurance journalists.
We were guilty of ignorance. We simply didn’t see things that were right in front of our faces all along. The industry didn’t see them either and because none of us saw them, none of us thought they were important. We didn’t see and we didn’t report.
But then all of a sudden we learned. And then we started seeing it everywhere. We suddenly remembered the long-lunch stories about laddish behaviour we had ignored as high jinks, the endless strip club anecdotes, and multiple far more gruesome rumours we had filed in the “surely-not-true” category.
We wondered why we never acted or investigated at the time and were rightly ashamed.
I then remember writing an Editor’s Letter putting the industry on notice that the game had changed and warning that from then on we as journalists were going to play our part in bringing victims’ accusations into the public domain and shining a searchlight on perpetrators.
It produced a strong reaction from some senior industry leaders. One wrote to say that he simply failed to recognise that such behaviour was even possible, let alone relatively common in the industry he had helped lead for 40 years and that we should stop muck-raking.
He wasn’t in denial – it’s just he hadn’t looked- and because he hadn’t looked he hadn’t found.
Atrium had an excellent reputation as an extremely well-run business. Indeed many, including I, would have held it up as an exemplary Lloyd’s firm sporting consistent outperformance and excellent underwriting standards.
Perhaps it was a little conservative and low-key. Few would score it high on brand recognition, but it was none the worse for that – here was a relatively small business that knew exactly what it was doing and was an undisputed leader and expert in the market segments where it played.
I would have assumed it would be a great place to work.
Now it has a big problem – it has gone from being almost unknown except to a select few, to known by all for only one very negative thing.
With time it should pass, but the business now has an enormous amount of rehabilitation work to do if it is to attract the best available talent to be able to sustain itself long term.
The lesson here is now that we know about this problem, like a new word, we must start seeing it everywhere. We can’t carry on pretending it isn’t there.
Atrium’s censure and fine is the final wake up call for any insurance board member who thought this was a problem that only happens at other companies, not their own.
I can guarantee you it is happening in your firm and if you don’t actively root it out, the consequences will be your responsibility.
If culture and behaviour don’t improve after massive fines, don’t think that regulators won’t use much tougher sanctions.
They will if they have to and withdrawal of licence to trade is the ultimate penalty available to them.
So what should we do?
First we should learn from other sectors that have done this really well.
In recent decades aviation has been able to engender a culture of absolute transparency when things go wrong and has improved its safety record exponentially as a result.
Insurance needs to do the same.
That means no more anonymity and settlements for abusers, and no more gagging orders for victims.
The PRA, the FCA, Lloyd’s, the LMA, Liiba and the IUA should ban such employment practices and force those they regulate or represent to shine a light on failings so that we can all learn how to avoid mistakes.
Let’s remind ourselves that the now infamous Employee A at Atrium left with a clean disciplinary record, an honourable discharge and a financial settlement.
For all we know he is still working in the insurance industry, ready to do it all again at a new firm.
Employee A needs to be the last, not the first of the alphabet. We need to get all Baader-Meinhof on him.