Episode 15 with Cynthia Tidwell, President and CEO at Royal Neighbors of America – Staying Relevant as a Fraternal Organization

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Beyond the Challenge is a podcast where executives in the insurance and financial services industry share their insights and experiences. Hosts Kevin and Sandy Dougherty talk with today’s top business leaders about what keeps them up at night and the biggest opportunity organizations can capitalize on today. We encourage you to listen, share, and subscribe to our program.

Kevin and Sandy Dougherty each have over 20 years of experience in insurance and financial services, corporate leadership, and executive search. They’re the owners of Global Corporate Solutions and Global Corporate Leaders. Global Corporate Solutions partners with organizations to gain efficiencies and contain costs. Global Corporate Leaders partners with organizations to enhance and evaluate talent.

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Welcome to Beyond the Challenge. Here are your hosts, Kevin and Sandy.

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Sandy: Today, we’re talking with Cynthia Tidwell, President and CEO at Royal Neighbors of America, about the challenges faced by fraternal carriers and her experience as an executive woman in the insurance industry. Cynthia, can you tell us a little bit about yourself and your background?

Cynthia: Sure, I’d love to. First of all, thank you for having me today. I’m currently president and CEO of Royal Neighbors of America. I’m going into my 16th year as the CEO. My background has been turnarounds and reinventions. I started my career many years ago on the property casualty side with Xerox Financial Services, helping it disengage from the insurance industry or its Crum & Forster companies. I then went to Allianz Companies and helped turn around Allianz Companies and ran a $1 billion business for them in the United States. After I left Fireman’s Fund, I landed at Royal Neighbors, which was my first role actually in life and annuity. So, I have a very eclectic insurance background and have been in many different roles and many different organizations.

Kevin: Thank you, Cynthia, and welcome to Beyond the Challenge. Cynthia, all sectors face challenges, but fraternal organizations, I would expect to have additional set of challenges. Can you tell us what new trends are fraternal organizations like Royal Neighbors witnessing since the start of the pandemic and does more uncertainty bring opportunity?

Sandy: Well, I always believe that change and uncertainty brings opportunity, you just have to find it. Now, fraternals have a large philanthropic component. Making a difference in communities where our members live and work is really part of the DNA of most fraternals but certainly Royal Neighbors, and volunteering is a large part of that. Last year alone, for example, Royal Neighbors members volunteered more than 280,000 hours across the country, even during the pandemic. Now, the pandemic made it more difficult to get together, like traditional volunteering, so we had to be creative in the ways to make a difference. Many fraternals stopped all of their volunteer activities because people couldn’t meet face to face any more, but at Royal Neighbors, we got busy with alternative ways to connect and do projects. We got people on Zoom and video and we got together and we learned how to sew masks and write letters to the military and provide food to food pantries, things that kept our members safe but still enabled them to make a grassroots difference in their communities. We also expanded our member benefits with Teladoc services, because a lot of our members did not want to go out to the doctors, and we expanded our retail discount availability. Now, our members have always been able to apply for scholarships, get a free simple will, and other health discounts and they have access to our signature women’s empowerment program, our Nation of Neighbors Women Grant Awards, but we know that more and more consumers wanna do business with an organization that does good or has a purposeful mission and, to me, the challenges that we faced have always brought opportunity.

Kevin: How has the past year and a half changed the way Royal Neighbors has worked with its producers and clients?

Cynthia: Well, we have been on a digital journey for the past five years, digitizing the customer and agent experience and taking friction out of the buying process and that’s served us extremely well when the pandemic hit. Electronic applications, accelerated underwriting, point-of-sale decisions enabled our agents to continue to meet with clients. Even if it wasn’t face to face, they could get on their calls, they could produce the business, and, with point-of-sale decisions, they knew by the end of the call, both the agent and the customer, that the coverage was in place and the coverage was bound. We have about 80 percent of our business that goes through with a point-of-sale decision so by the time the agent hangs up the phone or leaves the house, they know the coverage is in place. We also have a lot of self-service tools where the agents can use, with mobile apps, go on our agent portal, get access to information of where things might be in process, and our customers can go and do self-service as well. These all helped us actually gain market share during the pandemic. Our life sales grew just under 30 percent last year in the face of some very challenging times. So, sometimes, it takes a crisis to see how fast change can actually really happen.

Sandy: Cynthia, you talked a lot about new technology that you’re using. How have you been dealing with tech debt and investing in the new technology?

Cynthia: Well, our IT platform does not have extensive legacy components or issues like some other companies but, that said, technical execution, IT, it’s always more challenging than any of us would like. We view technology as a business enabler and as we continue to get more efficient, we divert those dollars to accelerate changes to improve the technology that we have. So, going to the cloud and more software as a service shifts costs. Sometimes, though, it increases your annual budget because you’re not capitalizing things that you would have capitalized in the past. So, technology helps us, enables us, but we have to pick and choose our points of where we’re gonna get the biggest bang for the buck based on our strategy.

Sandy: Thank you. Do you see more carriers outsourcing and using strategic partnerships or keeping more functions in house?

Cynthia: I think that’s a great question and I can’t speak to what everyone else is doing, although I do have a pretty good pulse on the mutual and fraternal worlds. For us at Royal Neighbors, core competencies need to stay in house. At the end of the day, that’s the value you bring, whatever your core competencies are, but we have increased our strategic partnerships and outsourcing over the past years when it makes the best sense to get that capability. Sometimes, we need to go to partners to get capability that would be draconian or almost impossible for us to build on our own, given our size and scale. So, there’s a cost to trying to do everything yourself and there’s a cost to going outside, but some expertise is best gotten from outside versus smaller companies trying to build it themselves. Again, the key for us has been picking and choosing what we wanna own that we think is truly proprietary and what we can capitalize on other large organizations and their expertise that they’ve built.

Sandy: What do you see changing in the insurance marketplace over the next three to five years?

Cynthia: Well, we’ve always said insurance is slow to change and, for the last 10 years, we haven’t seen a lot of change but I think the next three to five years is going to be extremely interesting and probably a different story. I do think we will continue to see accelerated change that began during this pandemic. Customers expect an easier buying experience. That being said, however, I don’t know anybody who wakes up and says, “Hey, today, let’s go buy some life insurance.” They still need that push, they still need that guidance, so, at Royal Neighbors, we focus on the middle market, underserved niche that’s out there. Many companies don’t wanna bother with it because it’s smaller policies but we feel that that is a very important place, people need us and we wanna be there for them. Now, those folks may only buy life insurance a few times in their life and life insurance and annuities can get pretty complicated if you’re not familiar with them. People still need guidance, but they want a quick, easy process, quick decisions, competitive pricing, and fast delivery. I do see people willing to share more data if they think it’s gonna get them something extra in the process. Now, for me, regulation is the wild card here. All those things I just talked about are gonna be accelerating over the next few years but when we talk about privacy, things like proxy discrimination, big data regulation, is that gonna impact the speed and effectiveness as we’re trying to enhance and simplify the buying process? Because we need tools, we need big data tools and algorithms to be able to really meet what consumers expect in that process. So, to me, regulation is gonna be somewhat of a wild card. But the need, we know the need for insurance is still significant and, at Royal Neighbors, we get up every day saying, “Who can we help? Who can we go find today to make a difference in their life to make sure that they have the protection they need?” and we help people when they need it most

Sandy: Great. What has been your experience personally as a woman in the insurance and financial services industry?

Cynthia: Well, I’ve been in this industry for a long time, as I said, both in the property casualty and now in life insurance and when I first started, maybe for the first 15 or 20 years of my career, it was not uncommon for me to be the only woman in the room most of the time. Now, I’ve had some great mentors over the years but I have also experienced bias because I am a woman. Those are just realities. Studies have shown that men and women are perceived differently as they climb the corporate ladder. Men gain likeability as they move up in companies and women not so much. That’s proven. I decided a long time ago that I could live with that but I needed to be respected. If people liked me, that was a plus, but could I gain the respect of the people that I needed to work with? Because if you have respect, you can accomplish a great many things. But that’s hard for a lot of women. They wanna be liked and, if you can, great, but if you can’t, let’s go for respect and let’s get something done. You know, I do see female diversity in the industry much better than it was, especially over the last 15 years, I would say. We’ve made some great strides. There’s still a ways to go but I do think we do need to celebrate the progress but we also need to expand our efforts for other diversity groups as well.

Sandy: On that note, how do you see carriers addressing diversity and inclusion and do you see this as a priority for many carriers?

Cynthia: The answer is yes, I do see it as a priority, at least within the life insurance industry. Many CEOs within the life insurance space have taken something called the CEO action pledge to make DEI an important business imperative and in that pledge are four major pillars and if you’ll bear with me, I’ll just, at a high level, go through them. And the first pillar is to cultivate environments that support open dialogue on complex and sometimes difficult conversations about diversity and inclusion. The second one is to implement and expand unconscious bias education and training. And the third is to share best practices, and maybe some not-so-best practices, on diversity and inclusion so that we can all learn together and move the needle more quickly. And then the final one is to engage board of directors or an equivalent governing body so that it really becomes a top-down as well as a bottoms-up approach within an organization. So, change doesn’t happen overnight but the first step is to realize the necessity and then commit to change and understanding why diversity is good for companies and businesses. If you can’t come to the conclusion that diversity is good for your business, then you’re only giving it lip service. It is going to make organizations better.

Kevin: What is the best decision you made that had a positive impact on your career? 

Cynthia: Oh, this is an easy one for me, I love to talk about this. Crossing functions, becoming a utility player. When I first started in my career, I did claims and litigation, very complex claims, complex litigation, and the CEO of the company I worked for came to me one day and said, “Well, what would you ultimately like to do as a high potential?” Of course, as a woman, I thought, well, I just wanna march up that functional ladder and I wanna run claims and litigation and he suggested that I do a stint running a business and he said, “I want all of my executive leaders to know how a P&L works so why don’t you go do that?” So he gave me that opportunity. He, in essence, changed my life. He opened my mind to the fact that I could be the top dog, I could run the business, I could do beyond my functional area, so I never handled a claim or a piece of litigation again after that. I went into and ran a business for him for a couple of years that was quite successful and have been managing businesses ever since. So, I would encourage women to take that risk, or anybody to take that risk. Sometimes, people are afraid. I went into something I knew nothing about. I knew a little about, but I hadn’t grown up in a P&L environment and I jumped into the deep end of the pool and I swam and I would suggest that, if people get that opportunity, that they do it. What is the worst thing that can happen? The worst thing that can happen is you go back and you do what you were doing before. But take the leap, take the jump, it can change your life.

Kevin: Great advice. I love listening to that. What advice would you give to someone looking to get into the insurance and financial services industry?

Cynthia: Well, first of all, I would tell them what a great career you can have in financial services, what a great career you can have in insurance. Insurance probably isn’t the most sexy career for a young person thinking about what they wanna do but there are so many aspects of it. There are so many ways to challenge yourself. Just in insurance alone, instead of all of financial services, there’s property casualty, there’s commercial, there’s personal lines, there’s specialty, there’s life, annuities, retirement, reinsurance, and then there’s all the different functions, right? So one day you could be doing marketing and then sales and then IT and running the organization. If you wanna make a difference, insurance is the business that helps people be protected. You can really help people. You’re constantly learning new things. If you wanna be a lifelong learner, insurance is for you because it is always changing, always growing, and I have found a wonderful career within it.

Kevin: From a professional standpoint, what keeps you up at night?

Cynthia: From a business perspective, I would — it’s gonna sound weird, I would say not much. To me, nothing is insurmountable. As a leader, I think you always need to be playing chess. You need to be looking multiple moves ahead. You need to be doing scenario planning so you’re not surprised by anything. You know, interestingly, for us, just in a side story, we do our business continuity planning and we do quarterly tabletop exercises. In 2018, we actually did a pandemic and we learned a lot from that tabletop exercise. Of course, when you do the tabletop exercises, you don’t think it’s ever really going to happen, but we saw that the Spanish Flu from 1918 was 100 years before, we said, “Well, these things tend to happen every 100 years,” so we did a pandemic and we learned a lot. So you always have to be looking for the unexpected. But we also have to remember when significant things happen, sometimes no one ever saw it coming. You know, the Great Recession, this pandemic, most people were taken by surprise so we have to be nimble, we have to pivot. One thing that does give me a little angst, I wanna ensure that the great freedoms of our republic aren’t eroded or that giveaways don’t take over the value of hard work and the sense of accomplishment that people have by really giving it all to a career and family.

Sandy: Cynthia, thank you for your time today. It’s been great to learn more about how you and Royal Neighbors are facing and overcoming challenges and the opportunities you see for both the insurance industry, in general, and, specifically, for women in the insurance industry.

Cynthia: Well, thanks for having me. It’s been great fun.

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