Insurance companies should consider donating to causes that leverage their insurance-related skills: report

Property and casualty insurance companies can deliver maximum impact and receive greater recognition for their charitable giving by committing to causes that leverage their unique insurance-related skills, according to a recent report by McKinsey & Company.
The report about the U.S. property and casualty industry, Charitable Giving in the Property-Casualty Insurance Industry, notes the U.S. industry as a whole gave $500 million in charitable contributions in 2010. This is in line with charitable contributions in other industries, the report noted.
But to obtain more recognition for their charitable deeds, insurance companies should reconsider how they are donating money, including increased collaboration among insurers, the report says.
In addition, companies should consider improving the link between business and social goals; setting objectives for donations (as they would for any other business investments); and committing to causes that leverage their unique insurance-related skills.
“Successful philanthropists typically focus on causes that build from their corporate capabilities,” the report says. “They explicitly attempt to solve those issues about which they are deeply knowledgeable.
“In the property-casualty industry, only 12% of companies surveyed consider the ability to leverage corporate capabilities a key determinant in shaping giving strategy.”
And yet, a company’s unique expertise or knowledge can be more highly valued than cash by beneficiaries and is often more advantageous to the donor, the report says.
“Citigroup, for example, uses its banking expertise to reduce financial vulnerability and improve economic self-sufficiency in emerging markets,” the report says. “Across 60 countries, Citi’s customized financing for micro-finance and micro-enterprise programs enables local entrepreneurs to build a solid base for their businesses. This has had more long-term impact than simply providing cash, since skills are developed that ensure sustainable change.
“Another example is Home Depot, which offers the services of its staff to repair homes for the elderly.”