California Insurance Diversity Drives $6.7B Economic Impact and Job Growth
The California Department of Insurance has released the first-ever Economic Impact Report highlighting the significant contributions of insurance companies contracting with small and diverse-owned businesses in California. These partnerships generated $6.7 billion in economic output, supported over 29,000 jobs, and produced more than $917 million in state tax revenues, demonstrating the economic influence of inclusive procurement practices within the state's $400 billion insurance market. This report was developed by the Department's Office of Insurance Diversity and Innovation, established to promote equity and inclusion across the insurance industry.
The data, collected through the nationally recognized Insurance Diversity Program, reveals that insurance companies spent $3.1 billion with diverse suppliers in California, facilitating economic growth for both insurers and small businesses statewide. Additionally, the Department introduced the 2025 Insurance Diversity Index, a benchmarking tool measuring insurance companies' integration of diversity into procurement strategies, governance, and leadership boards. Results indicate that firms emphasizing equity tend to outperform peers, linking inclusive business practices to sustainable growth and enhanced consumer trust.
The 2025 Insurance Diversity Summit underscored the importance of supplier and board diversity in fostering innovation and resilience amid challenges like climate risk and demographic shifts. The event gathered policymakers, industry leaders, and community advocates to discuss how diversity drives industry sustainability. Leadership from the Insurance Diversity Task Force, notably its first all-women leadership team, was highlighted during the summit.
The report and related initiatives reinforce a strategic focus on diversity as a catalyst for economic efficiency and community strengthening, with Commissioner Ricardo Lara emphasizing that investments in diverse suppliers have a multiplier effect by stimulating local economies and job creation. The Department of Insurance's ongoing consumer protection mission is supported by these diversity-driven policies aimed at enhancing market performance and consumer outcomes in California's insurance sector.