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How Aflac CEO Dan Amos Turned an Insurance Company Into an International Name
There aren’t many CEOs who can confidently say they bet their company’s reputation on a duck. Yet that’s exactly what Dan Amos, chairman, president and CEO of supplemental insurance giant Aflac (AFL), did it almost 25 years ago.
Amos’s unconventional and risky gamble to test a possibly irritating ad campaign involving a quacking duck not only made Aflac a household name internationally, but also changed the advertising game for insurance companies.
“The sympathy went through the roof afterward,” Amos told Yahoo Finance in an exclusive interview at the company’s headquarters in Columbus, Georgia. “And so, in a matter of three years, we doubled our sales in the United States.”
It’s this kind of sales growth that has attracted investors to Aflac for decades. Including reinvested cash dividends – something the company is known for – Aflac has returned more than 15,000% to shareholders over the past 33 years. During Amos’ tenure, Aflac shares rose from less than a dollar to more than $80.
Aflac’s share price continued to reach record highs in 2024, but questions remain about Aflac’s ability to unlock the next revenue growth catalyst.
The company’s total annual revenue has been declining since 2019and faces a challenging sales environmentO Artificial intelligence’s potential to disrupt industryIt is demographic challenges in its largest market, Japan.
“Let me tell you, the last person in the world I would expect to have [technology] would affect taxi drivers, and Uber almost put them out of business,” said Amos, who is the fifth longest serving CEO in the Fortune 500 and the second longest serving CEO in the Fortune 200, behind Berkshire Hathaway’s Warren Buffett. “Now they’ve figured out how to do it. But the point is: don’t think you’re not vulnerable to change.”
Aflac’s total return to shareholders, including reinvested dividends, under the leadership of Dan Amos. ((Yahoo Finance))
Aflac’s ‘golden goose’ and success in Japan
Amos calls the Aflac duck his “golden goose.” In 2000, two advertising executives came up with the idea to poke fun at the company’s name, and Amos took a chance on a $1 million ad. Previously, he said, the company had not spent more than $400,000 on a commercial.
The commercial catapulted the company’s brand awareness from 11% to nearly 94% in 14 years, according to Aflac. Although other insurance companies have adopted similar humorous advertising tactics, Amos noted that the company is able to spend a fraction of what other accident insurers spend on advertising each year.
The Aflac duck visits the floor of the New York Stock Exchange on December 4, 2015, in New York City. (Andrew Burton/Getty Images) (Andrew Burton via Getty Images)
But Aflac’s success began long before the duck made its debut. Originally known as American Family Life Assurance Company of Columbus, the company adopted the acronym Aflac in 1989, a year before Amos became CEO following the death of his uncle, John Amos.
The story continues
Amos inherited a company that had quietly expanded its presence outside the U.S., specifically in Japan, since 1974, when a trip by Amos’s uncle to the Osaka World’s Fair led to the company obtaining a license to sell health insurance in the country. Today, Aflac’s medical, life and death coverage benefits are used by one in four Japanese families, according to the company.
However, dependence on the Japanese market brings demographic pressure on both ends. By the year 2050, the United Nations predicts that the proportion of people aged 65 and over in China and South Korea will surpass that of Japan. Add to that a declining birth rate and it presents a dilemma for Aflac.
The percentage of people over 65 in China, South Korea and Japan. ((Yahoo Finance))
The solution, according to Amos, is the company hybrid policy approach — a combination of cancer insurance and life insurance to attract younger consumers earlier so they avoid financial hardship later. It is part of a selling campaign Aflac was recently launched to coincide with the company’s 50th anniversary of doing business in Japan.
There is also the geographic risk of relying on Japan for most of Aflac’s revenues. Amos noted that he is still concerned after the 2011 Tohoku earthquake and tsunami claimed more than 18,000 lives and caused extensive damage to the Fukushima Daiichi nuclear plant.
A view of Aflac’s Japanese website as part of its sales campaign. (Aflac) ((Yahoo Finance))
A Humane Approach to Health Insurance
Aflac also faces a future healthcare industry that is poised to change more in the next three years than in the previous 30, driven in large part by the COVID-induced shift in the sector from door-to-door sales and handwritten paperwork to digitization and, now, generative AI.
Despite the advances, Amos does not foresee a time when AI replaces the human connection between Aflac customers and employees. While other U.S. companies outsource call centersAmos has strived to keep Aflac customers connected close to home by allowing regular one-on-one interactions with its employees, who Amos said are the heart and soul of Aflac.
“From a management perspective, our most talented and important people are in the call center because they are the line between the company and the customer or between the agent and the company,” Amos said. “And so it’s really important that we have positive attitudes, help them do whatever it takes to make sure it works.”
“I think the human touch is something very important for the company’s growth,” he added, “because everything we sell is a promise on a piece of paper.”
Three principles of risk management, according to Aflac CEO Dan Amos. ((Yahoo Finance))
But even with his traditional approach, Amos embraces change wholeheartedly. Rather than seeing developments in generative AI and medical advances in mRNA COVID vaccines as a threat to supplemental insurance, Amos sees them as an opportunity.
“Well, I don’t know anyone who is more excited about our future than I am and what I see ahead of us, because people, through healthcare, are finding cures,” Amos said. And then you need additional coverage to help cover those costs.”
At the same time, after 50 years of working at Aflac, from 19-year-old college student to CEO, Amos still has some things that keep him up at night.
“I have to worry about tsunamis in Japan,” Amos said. “I worry about interest rates and what’s going to happen in that regard. But am I scared of them? No. We manage risk. That’s what we do for a living… So I’m not nervous about it, but I wouldn’t worry about all of that. And if I didn’t, I wouldn’t be a good risk manager.”
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