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Life Health > Health Insurance

Tapping The African-American Market

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If youre in an office or any place of business right now, look around you: The face of the American work force has changed. A generation ago, it was overwhelmingly a white male world, but now the full-time work force is 43% female and the part-time work force is 66% female, according to the U.S. Bureau of Labor Statistics.

Minority populations are also growing quickly: census figures show the African-American population expanded almost 20% during the 1990soutpacing total U.S. population growth overalland now represents about 13% of the total.

The buying power of this market segment is huge, and continues to expand. For example, median African-American income rose 14% from 1995 to 1996, creating $367 billion in buying power, according to the U.S. Census Bureau. That number jumped to $392 billion a year later.

And it isnt just the employee base that has a changing face. The number of African-American-owned businesses grew by 46% between 1987 and 1997, according to the U.S. Small Business Administrations 1999 “Minorities in Business” survey.

At the same time, the minority population is largely underserved by the insurance industrybut not because of lack of interest on the customers part. A 1995 report from The Commonwealth Fund said nearly a third of minority Americans lack health insurance, but have favorable impressions of life and health insurance companies.

This burgeoning African-American marketplace can offer a tremendous opportunity for health insurers that take the time and effort to understand this group and adjust their techniques accordingly. That said, marketing to African-American employers and employees involves the same basic principles as marketing to any other audience: understand the priorities and culture, offer the right mix of products at the right price, and know how to build a relationship based on trust.

Building Trust

The biggest obstacle is building a relationship of trust. Especially if you arent a member of the group youre marketing to, this may mean you need to plan for a longer-than-normal sales cycle.

Take the time to listen. You may find out that your potential customer needs a better understanding of the benefits of your products and services or how the process works. By listening, youll also find out concerns and objections that will give you the information you need to begin to build trust. Whats more, your willingness to give a service that takes time with your potential client confirms the message that you are trying to deliver: you can be trusted, and you are in the relationship for the long term. You become a benefits counselor, not a salesperson.

Get involved in the community and be ready to support community organizations and events. Youll not only be in a position to meet more prospects, but youll also be visible as a friend and supporter of the community.

Building trust in turn helps build loyalty. And loyal customers may also help you advertise your business through word of mouth. When they refer you to colleagues and friends, you will find it even easier to build trust and close business, helping you to quickly grow your business.

Learn The Facts

You can also increase your opportunities by learning as much as you can about the specific challenges and concerns faced by the population you are marketing to. For example, a group with a large employee population of African-American women may be receptive to a cancer or critical illness plan. Statistics from the South Carolina Central Cancer Registry 1997 annual report show these women have a higher-than-average incidence of mortality from breast cancer. A type of insurance that includes a benefit for yearly mammograms, for instance, may be valuable to this group and meet its specific needs.

African-American men also may be receptive to buying this type of coverage. According to a 2001 report by the American Cancer Society, Chicago, African-Americans have the highest prostate cancer incidence rates in the world and are twice as likely to die from this disease as other American men. Having one or more close relatives with prostate cancer also increases a mans risk of developing this disease. Talking with your customers about these concerns can both educate them and uncover their needs.

Family Matters

Understanding family dynamics can make the sales process much smoother and more effective. Consider who traditionally makes the financial and insurance decisions in the household. The Census Bureau reports that the number of households headed by single African-American women grew by 2.3 million people in the 1990s. If your market includes African-American single-parent households, our sales representatives often find them very receptive to purchasing disability and other products that will provide income-replacement coverage and protection for their children. Asking the right questions is crucial in helping you determine your clients needs.

Every recent study shows the minority population and business community in the U.S. will continue to grow quickly in the coming years. Those who want to succeed in the long term will take time now to learn about these markets and develop the techniques necessary to compete in them. Whether you are a member of the minority population you are marketing to or not, youll find that a willingness to listen and learn coupled with a commitment to building a relationship of trust can bring you the success you seek.

is the public sector manager for the Colonial Supplemental Insurance office in Detroit, Mich. Colonial is a worksite marketing unit of UnumProvident Corp.

Reproduced from National Underwriter Life & Health/Financial Services Edition, June 10, 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.


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