Mutual membership revisited

A more comprehensive re-imagining of membership seems pertinent for mutual insurers and friendly societies. This should make 21st century life and aspirations of members central.

Membership should go beyond the offerings of (e.g.) Oddfellows and beyond the health-focused added value benefits offered alongside regulated financial products.

Where this article fits

This membership article argues that the nature of mutual membership should be reviewed. We suggest an enhanced membership offering would appeal to a wider demographic, foster long-term engagement and differentiate mutual versus proprietary insurers.

The engagement article suggests there is a major problem with lack of engagement of potential and actual customers with protection. We explain why the current protection offering and thinking means non-engagement is inevitable – almost mathematically so.

The wellbeing article suggests one solution. A comprehensive wellbeing proposition has engagement designed in from outset. The real question: will protection insurers be involved?

The Protection 3.0 article brings everything together into a people-centred insurer proposition.

Meaningful membership

Mutuals, which offer a more limited product range compared to proprietary companies often face challenges in making a compelling case for mutuality and membership.

Whitecap Consulting highlighted this issue in 2021, quoting the former CEO of Cirencester Friendly on the difficulty of conveying the value of mutuality:

“We are transparent and endeavour to pay all claims, but our values are where we fundamentally differentiate. They govern how we work and deal with people. Trying to make mutuality tangible is a challenge though, when it is such an intangible subject to talk about.”

Meaning beyond absence?

We don’t have shareholders to pay, which means our members always come first.
Source: Any number of friendly society websites and annual reports.

Does this mean anything? When was the last time you bought something from a company (or politician!) because of their values or because they said they’d put you first?

If you could find a trusted firm with a big brand and cheaper prices that others said gave good service, wouldn’t you go with them? The Co-op did:

“We’re thrilled to be working with Legal & General … We share Legal & General’s values of putting customers first and offering quality products that are easy to understand and access.” Source: Matthew Collings, Partnership Development Manager, Co-op Insurance.

Partnerships with a narrow product range are tough. Give yourself a chance.

Are you really different?

Mutual and proprietary insurers look quite alike today:

• Mutual benefits often look like the added value benefits that proprietaries offer to their customers. Things like GP24. This article proposes different membership features (which can also be offered by non-mutuals) independent of the points below.

• Mutual risk sharing has largely disappeared, replaced by insurance contracts which are hard to distinguish from those of proprietary firms. The few exceptions include small benefit societies and a few larger discretionary mutuals such as Benenden Health.

• Mutual ownership and control is unclear. Members supplied capital to back insurance contracts, but in what scenarios is this returned? Do members have any real say in whether a mutual should merge or close, or is this effectively decided by management or a regulator?

Traditional membership

Some friendly societies are different. I have found only two well-known societies – Foresters Friendly and Oddfellows – which today offer traditional social membership in addition to (and independently of) regulated financial products.

Some Oddfellows membership benefits:

• Social benefits e.g. online and face-to-face events and activities.
• Give back through volunteering, fundraising and society involvement.
• Member offers e.g. cinema tickets, holidays, cars, groceries.
• Travel and holidays e.g. cruises, short breaks, summer holidays.
• Care benefits including care, convalescence, financial aid, legal and other helplines.

This traditional social membership typically appeals to older demographics who value social engagement and community support. In practice interest is declining. To reverse this we need to modernize appeal and broaden the age range of members.

Positive membership

Health is a state of complete physical, mental and social wellbeing and not merely the absence of disease or infirmity. Source: First principle of World Health Organisation (1946).

Mutuals emphasize the absence of shareholders and traditional psychologists aim for the absence (or less ambitiously management) of mental illness. But both can do better.

Positive psychology has risen to the WHO challenge and focused on its offering being the presence of something: wellbeing and flourishing. Here’s the foundational paper from 25 years ago. Between them the authors invented positive psychology and flow.

It’s time mutuals offered a more positive and modern membership.

Modern membership

Mutuals can broaden the appeal and impact of membership by considering a wider range of interests and needs, especially for those who are not members. Offerings that (particularly) resonate with younger individuals and families, who are navigating various life stages and responsibilities, such as:

Support family and work life. Benefits that address work-life balance, family engagement, and career development can significantly enhance member value. This is because we are “joining in” and supporting activities in which members are already engaged.

Promote achievement and personal growth. Programs focused on personal achievements, goal setting, and professional development can inspire and motivate members to pursue their passions and dreams. Again, we are joining in activities which are already of interest to members.

Encourage relationships and collaboration. Surely appropriate for a mutual. Collaborative problem-solving is particularly encouraged, enabling members to work together to find innovative solutions to common challenges. Interpreted widely, the possibilities are endless.

Enhance wellbeing. Incorporating mental health resources, wellness programs, and activities that reduce stress and promote overall wellbeing aligns with the holistic approach of positive psychology. Indeed the two previous points are entirely consistent with the PERMA model of wellbeing.

Conclusion

Adding a PERMA model perspective to mutual membership:

• Appeals to a wider demographic
• Uses the proven mental and physical health benefits of positive psychology
• Taps into members’ existing interests
• Fosters long-term engagement and satisfaction
• Differentiates versus proprietary offerings

That’s surely better than the status quo.