on June 25, 2013 by admin in Insurance Industry, Comments (0)

Insurance a force in state’s economy

While manufacturing, tourism and farming are considered the big keys to Wisconsin's economy, the insurance industry — with good-paying jobs and top companies nationally — often is overlooked as an important contributor to the state's well-being, insurance industry advocates said.

Wisconsin is home to almost 250 insurance companies, fourth-highest among states nationally, according to a new study released by the Wisconsin trade associations for life, health and property-casualty insurers.

The insurance industry directly employs about 80,000 people in Wisconsin and has increased jobs even as other sectors have shed workers, the study said.

"This industry is somewhat of the forgotten industry," said Andy Franken, president of the Wisconsin Insurance Alliance. "Political leaders like to talk about the three-legged stool of manufacturing, tourism and agriculture. I think we would argue that this industry gives stability to those three legs."

Franken said the insurance industry "puts individuals and businesses back together after significant life events."

"This industry invests in the state, and this industry provides the jobs and the payroll to drive a lot of communities across the state," Franken said. "We think we're the stablity of that stool."

Although a recent study by the Wisconsin Economic Development Corp. pinpointed manufacturing as "the engine that drives the Wisconsin economy," the insurance study — conducted by Wisconsin Taxpayers Alliance on behalf of the insurance trade associations — paints a picture of a state industry that hasn't been as vulnerable to ups and downs as manufacturing. The industry also maintains some important national headquarters here.

"If you look at the time period of about 2001 to 2010, the state economy as a whole lost about 3.3% in terms of jobs. The insurance industry grew about 11.1% in that time frame," said Connie O'Connell, executive director of the Wisconsin Council of Life Insurers and a former top insurance regulator in the state.

O'Connell noted the state is home to U.S. leaders in their areas of expertise in the insurance industry: Northwestern Mutual Life Insurance Co., of Milwaukee: religious organization insurer Church Mutual Insurance Co., of Merrill; jewelry industry insurer Jewelers Mutual Insurance Co., of Neenah; and the country's biggest fraternal organization, Thrivent Financial for Lutherans, which is based in Minneapolis but has a large presence in Appleton.

"We have a lot of companies here, more jobs here, higher payroll relative to other states," said O'Connell, who was Wisconsin insurance commissioner during the administrations of Govs. Tommy Thompson and Scott McCallum.

The study, using data from 2010, said the average insurance industry wage was $61,549, compared with the state average of $39,176. The industry's payroll was $4.9 billion, about about 5.4% of the state total.

Tom Thieding, spokesman for the Wisconsin Economic Development Corp., said state officials are well aware of the importance of the insurance industry. WEDC has formed a group to work with insurance companies and financial institutions to help them thrive, he said.

Wisconsin insurance trade association leaders said having large numbers of insurers doing business in the state spurs competition that helps keep premiums in check for consumers.

In addition, they said, some of the premium dollars sent to Wisconsin-based insurers from around the country end up being invested in the state. Wisconsin's insurance regulatory climate is stable and consistent, which fosters a favorable atmosphere for insurers to do business, they said.

Article source: http://www.jsonline.com/business/insurance-a-force-in-states-economy-b9940964z1-212855111.html

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