The Catholic Difference
On Nov. 3, 2015, the Knights of Columbus surpassed $100 billion of life insurance in force, marking a significant milestone in the Catholic fraternal benefit society’s mission to protect the financial future of Catholic families. Through its network of more than 1,500 dedicated, professional agents in the United States and Canada — all of whom are members of the Knights of Columbus — the organization offers top-rate products to its members and their families, manages $21 billion in assets and ranks 939 on the most recent Fortune 1000 list.
The foundation of these numbers, however, is the farsighted vision of Father Michael J. McGivney, who was motivated to serve and strengthen Catholic families, in part by protecting their financial well-being. Supreme Knight Carl A. Anderson recently spoke with the Columbia editors about the continuing mission of the Order’s insurance program and what sets it apart as a uniquely Catholic enterprise.
Columbia: What role does the Order’s insurance program play in relation to Father McGivney’s founding vision for the Knights of Columbus?
Supreme Knight: The insurance program is — and has always been — at the core of the Knights of Columbus. We have to remember the historical circumstances surrounding our founding. Father McGivney was the associate pastor of a church that largely served an underprivileged, immigrant community. Many in that community were dying young, and many were leaving behind large families — widows and orphans — with scant resources. In fact, Father McGivney had experienced their plight firsthand when his own father died. Young Michael McGivney had to leave the seminary to return home to Waterbury, Conn., to help his family.
So the genius of Father McGivney’s vision, forged through his own personal experience and suffering, was that he was able to combine spiritual principles and practical insights. That is, he was confident that a fraternal society like the Knights of Columbus could deepen the faith of its members while providing a strong sense of Catholic brotherhood. Yet the Knights of Columbus was also — in large part — his solution to the problem of financial poverty as well. It was critically important to him. He had hands-on involvement in the formulation of the original pass-the-hat insurance program, and studied how other fraternal benefit societies worked. And we know that he was himself the Order’s first insurance member.
Columbia: As far as milestones are concerned, most insurance companies would emphasize revenue, or some other number, not insurance in force. What is the significance of the Knights of Columbus reaching $100 billion of life insurance in force, and what does this achievement mean for our members?
Supreme Knight: The Knights of Columbus is not like “most insurance companies” because we are not concerned with profit in the way a traditional business is. Our “bottom line” is different. It’s not a question of how much money we made; it’s a question of how many Catholic families we protected. That is our mission.
And the insurance in force number or milestone is a reflection of that mission. Insurance in force is the total sum of the face amount of all of our active policies. What that means, fundamentally, is that our amount of insurance in force — $100 billion — is the amount of money we will pay to Catholic families in their time of need. It is a number with real impact.
So yes, we celebrate that number as it grows, but not because we want to flex our financial muscle. Rather, we take pride in such growth because it means that more Catholic families, lives, homes and futures will be protected.
Columbia: In addition to providing financial security for Catholic families, how is Knights of Columbus Insurance tied to charity, the Order’s first principle, especially in terms of service to the Church and to those in need?
Supreme Knight: This is a critical point to understanding the role that Knights of Columbus Insurance plays, not only in the mission of the Order, but in the day-to-day action of the Order throughout the world. The insurance program is a powerful financial engine that supports much of the good works we do. Through the insurance program, we are blessed with the opportunity to give generously and support numerous charitable and spiritual causes, building up society and the Church.
Of course, this is closely tied to our Catholic identity and the fact that charity is our first principle. We are called to be “our brother’s keeper,” and to look after the physical and spiritual well-being of those around us. But the fact is that without the insurance program, much of what we do, particularly at the Supreme Council level, would simply not be possible.
Columbia: What does it mean to say that the Knights of Columbus is a Catholic company, and how does this Catholic identity affect the way the Order conducts business?
Supreme Knight: It means that we are different. We talk a lot about the “Catholic difference” of doing business with the Knights of Columbus. We present our members with a clear choice between doing business with us and doing business with a secular insurer. We are proud of our identity as a Catholic company.
One of the key ways in which our Catholic identity impacts our business operations is with our investment strategy. We hold a substantial amount of investments, as any insurance company does. But here again we do things differently. Most companies focus on the return on their investments. They want to make sure they are making the most they can. But we are not willing to sacrifice quality and integrity for profitability. For example, we refuse to purchase “junk” bonds or derivatives. We will not invest in companies that are in any way involved in abortion, contraception, human cloning, embryonic stem-cell research, for-profit healthcare that pays for any of these things, or pornography.
It is a principled approach to investing that we think highlights the depth of our commitment to our faith. And while following these principles, our investment team has consistently achieved positive and competitive financial returns.
Columbia: Many people think that a business cannot simultaneously hold high ethical standards and be competitive in terms of profitability. How has the Knights of Columbus achieved such success, receiving top ratings from independent ratings agencies for financial strength, while at the same time emphasizing ethical practices?
Supreme Knight: We believe that the one strengthens the other: The more we hold true to our ethical principles and practices, the more value brother Knights and their families see in our business. The more value they see, the more they turn to the Knights of Columbus to help protect their family, and the stronger our financial position grows.
And it goes even further. I firmly believe that our moral compass has helped guide us through a turbulent decade and an uncertain economy. While other companies were making ethically questionable and unnecessarily risky decisions, we were not. While others were looking for novel ways to do business and to increase profits, we were not. Our ethical practices, in fact, received international recognition in 2014 and 2015, when the Ethisphere Institute designated the Knights of Columbus as a World’s Most Ethical Company®.
We stayed true to our principles and knew that if we did the right thing for the right reasons, we would get the results that we wanted — and we have. Last year marked our 15th consecutive year of insurance sales growth.
Columbia: The Knights of Columbus proudly provides insurance “by brother Knights, for brother Knights.” Why is it important that the K of C field force is made up of members serving other members?
Supreme Knight: I believe that access to a brother Knight field agent is the best benefit of doing business with the Knights of Columbus.
There are many types of insurance companies, including stock companies, mutual companies and fraternal benefit societies. The hallmark of a fraternal benefit society — like ours — is that it is brother-to-brother, member-to-member.
These men are not just salesmen, but men dedicated to our Order and its principles. They are men who care deeply about brother Knights’ families and their financial protection. They are men bound by the bonds of brotherhood who are committed to being there when you and your family need them most. That’s why we say “insurance by brother Knights, for brother Knights.” Our relationship with our policyholders is not simply transactional, it is personal. And it is personal precisely because it is grounded in a Christian understanding of brotherhood.
Columbia: What would you say to a member who has not yet taken the opportunity to meet with his agent and to examine the many products and benefits offered through the Knights of Columbus Insurance program?
Supreme Knight: Now is the time. This is an extraordinary program, spearheaded by extraordinary brother Knights in the field who have made it their mission to carry on Father McGivney’s goal of providing financial protection to Catholic families. Why would you look elsewhere?
With the Knights of Columbus, you are doing business with brothers. You are doing business with an authentically Catholic company, and one whose ethical integrity and financial strength are well-documented and widely recognized.
By becoming an insurance member, you are taking advantage of the greatest fraternal benefit that we offer and taking the critical step of protecting your family. It’s a responsibility that we all have — especially as fathers — and one that we can fulfill with the help of the Knights of Columbus.