Insurance and Financial Protection - Insurance Thought Leadership



May 5, 2021

Insurance and Financial Protection


If the life insurance crisis is hard to understand, we must make it easy to comprehend. The insurance industry must lead us through this crisis.

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If insurance is a matter of predictive analysis, the most accurate prediction requires no analysis. The prediction is a sentence of pith and precision, economizing words while encompassing phenomena throughout the world. The prediction is a law, Stein’s law, whose namesake, Herbert Stein, was an adviser to presidents and the father of a speechwriter, Ben Stein, to a succession of presidents. The prediction says, “If something cannot go on forever, it will stop.”

What will stop is the obvious: a runaway stock market in which distance is infinite, speed limitless, direction ascendant and principal impenetrable. That people believe this trajectory is not only real but sustainable, that they believe this trajectory transcends Stein’s law as well as the laws of economics and common sense is reason for insurers to act.

What insurers must do is save the many, so people may protect their savings. Failure to act will result in a stoppage of incalculable stress and immeasurable loss, where tomorrow’s retirees have no way to retire save expiring en masse, save death in lieu of destitution.

Without life insurance, those who need a safe and tax-free source of retirement income will not have one. Without life insurance, those unable to work will be unable to live. Not without assistance from the government. Not without a concomitant rise in prices and collapse in dignity. Not without a recession in the economy and a sense of fear among the people.

Avoiding this scenario starts with alerting the public to the imminence of this threat.

The alert must be clear, thanks to the simplicity of the message and the frequency by which it repeats itself. The writing and delivery of the message is a charge the insurance industry must assume and a role it must accept. The costs are minimal, in comparison to the consequences of inaction.

To sound the alarm is to admonish the public, telling the many what to do and where to go.

To sound the alarm is not to sound like an alarmist, because the crisis we face is too extreme to exaggerate.

If the crisis is hard to understand, we must make it easy to comprehend. If the crisis is hard to define, we must make it easy to describe. If the crisis is hard to divert, we must make it easier to diminish.

See also: Insurance Outlook for 2021

The insurance industry must lead us through this crisis. 

Steadfast in its dedication, the industry can secure its place in history; strong in its devotion, the industry can make history. 

Saving a generation from financial ruin is a moral duty. The duty insures lives, providing for the defense of liberty and the pursuit of happiness. The duty demands exemplary counsel, by people of excellent character, for people in exigent circumstances.

The duty belongs to the insurance industry, allowing it to earn what no amount of advertising can buy: trust.

Honoring this trust enriches the lives of millions, exceeding the combined wealth of a thousand billionaires, because safety is a treasure of inestimable worth.


About the Author

Jason Mandel is founder and CEO of ESG Insurance Solutions, a risk management and business consulting firm.

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