Women in Insurance – A History – The 1980s

 

met life advert 1980s

From the disillusionment of the 1970s, the 1980s moved America to the right with the conservative politics of President Ronald Reagan. Elected by an overwhelming majority in 1980, despite his conservative views, Reagan oversaw the nomination of the first female Supreme Court Justice (Sandra Day O’Connor), saw the first American woman to go to space (Sally Ride), and ushered in the end of the Cold War with the fall of the Berlin Wall in 1989. When Reagan left office in 1989 he had the highest approval rating of any president since FDR.

Inflation that had risen significantly during the 1970s continued to rise in the 1980s. In 1982, the United States experienced the worst recession since the Great Depression. While the economy recovered rather quickly, another stock market crash on October 19th, 1987, highlighted to investors that the economy had entered a new era of volatility.

In terms of women’s rights, the legal battles over discrimination continued. In 1984, the US Supreme Court found it illegal for clubs such as the Kiwanis and Rotary Clubs to discriminate based on sex. In 1986, the Supreme Court found in the Meritor Savings Bank v. Vinson case that sexual harassment was a violation of Title VII of the Civil Rights Act of 1964, and as such was a form of illegal job discrimination.

In 1980, the first woman was elected to Congress without following a husband or father into the position. In 1981, Sandra Day O’Connor was appointed to the Supreme Court. In 1984, the first woman was nominated to be vice president on a major party ticket.

The 1980s saw the rise of the yuppie, the emergence of MTV, the introduction of the blockbuster film (E.T., Return of the Jedi, Raiders of the Lost Ark, to name a few), and the birth of the 24-hour news cycle.

LIFE INSURANCE DURING THE 1980S

The demographics of the US were changing dramatically during this decade. The traditional family, with the husband as the primary (and only) breadwinner was gone, and in its place were single-mother families (approximately 33% of all households in 1984), divorcees, new immigrants, people who chose never to marry, married couples with no children, and retirees. The population had grown 60% since 1960 to 236 million people. These demographic shifts had a marked impact on an industry built on the foundation of the traditional family with a father who needed to protect his family.

Life insurance sales had been flat throughout the prior decade, and the trend continued into the 1980s. In 1960, 64% of all individuals in the US carried some form of life insurance; in 1984, it was 63%. In 1960, 72% of all households owned life insurance purchased through an agent; in 1984 this had dropped to 56%.

In 1981, $371 billion in individual life insurance was sold. Group life insurance sales brought the total to $544 billion. Products shifted during this decade. The “family plan” policy that was popular in the 1960s virtually disappeared. Term insurance took on significant popularity. Due to the increase of women in the workplace, families covered by group life jumped by 12 million between 1976 and 1984.

One LIMRA study showed that replacement activity (dropping one policy in place of a new policy) jumped from 36% of all households in 1980 replacing a policy to 56% in 1984. This marked increase was attributed to agents working their existing market and neglecting new, hard-to-reach markets. Another contributing factor was the industry tendency to recruit existing agents that were more likely to sell to their existing customers rather than reach out to a new market.

Inflation continued to be a major issue for the industry. Loan activity was higher than ever, with policy holders able to earn significant gains by withdrawing their funds from their whole life policies and investing them elsewhere. This inflation along with the recession saw many consumers turning to term insurance and shunning the whole life policy that had been so popular for decades prior. Early in the decade, term insurance accounted for over half of the volume of life insurance sold.

Hotly debated during this decade was the tax-free build up of the accumulating cash value within life insurance policies. President Reagan’s tax plan would have eliminated this provision, and the life insurance industry would have “died a slow death” (New York Times, 1985) as the value in purchasing cash value life insurance dried up. Fortunately for the industry, after all the debate, the cash value was protected from taxes.

In 1985 the news was dominated by the debate in the insurance industry over the use of gender to determine insurance rates. That year, the National Organization of Women filed a lawsuit against Metropolitan Life Insurance Company accusing the company of discrimination in both life insurance and disability insurance pricing. Organizations throughout the industry took sides, and legislatures across the country debated this hotly contested issue.

In March of that year, the American Council of Life Insurance took out a full-page ad in the Boston Globe and other newspapers across the country in order to defend the industry against NOW. The advertisement read: “Some people would charge women more than their fair share for insurance and call it equality. Sound like a good idea to you? We hope not.” The implication here is that if unisex rates were to be implemented, women would have to pay more to compensate for the higher mortality rates of men. Advocates for the unisex rates and NOW’s lawsuit claimed, “The insurance industry is the only industry that practices sex discrimination overtly [by setting rates based on gender].”

Montana was the only state to have implemented the unisex rates when the Massachusetts legislature began to seriously consider mandating unisex rates for all types of insurance. It is important to note that this issue was larger than just life insurance. At the time, women were paying higher rates than men for health, accident, annuities and disability income insurance, but lower life insurance rates. In the end, likely due to the intense lobbying efforts by the industry, Massachusetts did not include life insurance in the legislation it passed. In 1987, a similar law was struck down in New York.

In 1987, the AIDS epidemic hit center stage for the US and for the life insurance industry. In that year, a test was developed for life insurance applications, and rules were set regarding when and where such a test could be required. Companies added new questions to their applications regarding AIDS, and a new era of medical testing was introduced.

In that year, AIDS-related claims reached $487.2 million, a 67% increase over the year prior. This was thought to be an understatement of the effect on claims given that insurance companies rarely investigate the cause of death beyond the incontestability period (usually the first two years of the policy). In terms of claims counts, in 1987 1.2% of all individual life claims were attributed to AIDS, up from 0.9% the year prior.

The advent of AIDS introduced the industry to “living benefits,” although the concept was already in the introduction phase when the epidemic hit. The ability and willingness to pay out a portion of the life insurance proceeds to aid a person who is terminally ill came about at the end of the decade. Initially these benefits were offered to those with cancer, Lou Gehrig’s disease, and complications of AIDS. There were some initial concerns over this benefit, with many companies worried such a payment would be subject to taxation, that medical diagnoses could differ between doctors, and that some beneficiaries may disagree with the arrangements. Despite these concerns, this practice quickly became standard in the industry.

WOMEN IN LIFE INSURANCE DURING THE 1980S

In the beginning of the decade, over half of all adult women in the US were employed, and the vast majority of them were employed full time. The number of single women delaying marriage and/or having children was growing, as was the number of single mothers. This, in turn, meant that the number of female heads of households were increasing, reaching 7.7 million families in 1980. In 1981, women made up 54% of the workforce, and the numbers were increasing.

While women had started to climb the corporate ladder, they were well behind men in terms of pay. A study conducted near the opening of the decade showed that in the 1,000 largest industrial companies in the US, 28% of the officers were women. However, nearly two-thirds of these officers were earning less than $50,000 per year, and a third of them were paid less than $30,000 per year. The average business woman in 1982 earned $10,000 per year, while the average man earned $17,000 according to a report from a study done in Chicago. In 1984, 64% of the largest American companies still had no women on their boards, and only 8% had two or more women on their boards.

In the insurance industry, a study by the ACLI in 1987 showed that only 2% of the women working in this industry made more than $25,000 per year while 42% of the men did. Reasons given for this phenomenon included the possibility that men at the highest ranks of the companies had not yet grown comfortable with women in leadership roles, and that women in life insurance may have concentrated themselves in self-segregated groups, keeping them from the mainstream where jobs paid more.

One important issue causing trouble for working women was that childcare options were not keeping up with the change in women’s status. As more moms went to work, they had to battle a system that simply had not kept up. The number of daycares was extremely low, many had inconvenient hours, and the cost, if a woman could find one, was prohibitively high.

As women continued to gain access and higher level positions in the work place, they were still, in terms of life insurance, underinsured or in many cases not insured at all. In 1980, 65% of all adult women held some kind of life insurance, but this was nowhere near the 80% of adult men who held life insurance. In addition, the average face amount for women’s policies was $7,680 compared to men’s at $29,000.

The Life Insurance industry continued to recognize the importance of the women’s market. In one article the author stated, “Women are important enough as buyers and decision makers for insurance companies to be concerned with them” (Wexler, 1980). A marketing magazine suggested that the women’s market was a “special” market, and as such, deserved “special treatment.” Although what this treatment would entail is not defined, the author does indicate that there is a difference between single women and married women.

Nearly everyone was saying the same thing about the Women’s Market – it was new, it was something separate from the “mainstream,” and it was something worth paying attention to. The Boston Globe announced, “For the industry, there’s the prospect of an almost entirely new market.” A representative from Travelers Life stated, “We noticed the status of women had changed. Women were economically more valuable. They had a life insurance value” (Saltzman, 1980). Manager’s Magazine wrote “The last great untapped market is the women’s market” (Myers, 1983). Metropolitan Life was quoted as saying, “We think its [the women’s market] going to be a tremendous market…Traditionally insurance companies would talk to the so-called head of the household, the breadwinner…but with more women in the workplace…the distinction between earner and dependent has often ceased to apply” (O’Connor, 1981). The Globe Mail stated “Many industry insiders still consider women an untapped market…It would be utter folly to ignore such a vast market potential” (Stinson, 1982).

Some strides were made in reaching the women’s market. In 1981, John Hancock Mutual Life sold 32% of their policies to women, up from 20% in 1971. In 1989, AIG Life launched their Women’s Group, a network of female agents challenged with reaching the women’s market. While they do not present statistics on how effective the effort was, they did report that the first printing of their marketing material went out of stock extraordinarily quickly.

Sun Life introduced a product named HER, the main feature being that the rates were based on a separate mortality table for women instead of the setback method used in decades past. These new tables claimed to save women up to 40% on their life insurance premiums. Sun Life was not alone in adapting pricing for the new mortality gains recognized for women. Equitable Life Assurance developed a new classification for women based on new mortality tables, and Manhattan Life instituted discounts on the male 3-year setback for women.

An article in a 1983 edition of Manager’s Magazine encourages salesmen to avoid female stereotypes such as (1) women are basically emotional; (2) successful women are tough, pushy and less than feminine; and (3) woman’s place is in the home (Myers, 1983). Women were, in fact, looking at life insurance differently. A focus group in 1989 revealed that the main reason women purchased insurance was to help fund the education of their children. Women wanted more information on their options and how their life insurance would help them reach their goals.

WOMEN AS LIFE INSURANCE SALES REPRESENTATIVES

A prediction from an article in 1980 claims “During the 1980s, women will play a greater part in the distribution of insurance products…Currently the percentage of women in the agency forces has increased dramatically, due primarily to social and government pressures and good experience with women in sales” (Weech, 1980).

In some places, women were finally being seen the same as men. One author wrote, “Women will generally fail and succeed in the same ways as men, provided that they are selected in the same manner that is used to select males.” The women that were successful reported great satisfaction with their jobs. One agent for Metropolitan Life, June Visconti, said insurance sales was “one of the most financially and personally satisfying careers a woman can embark on.”

In 1980, Mutual of New York’s Pittsburgh agency formed a Women’s Unit, and found it to be a success. The company found that by capitalizing on the natural skills of women, including teaching, listening, nurturing and influencing, women were successful in reaching female customers. In 1981, 13% of the sales agents with both John Hancock Mutual Life and New York Life were women. In 1982, Sun Life of Canada, a company that had stepped up recruiting efforts in the women’s market, boasted 24% women in their new recruits.

One report stated that in 1983, there had been a significant increase in US women selling life insurance. A LIMRA report from 1984 stated that 12% of the agency force was female at that time. By mid-1986, it had risen to 18%. The reasons given for the increase in the number of female agents included the fact that no particular education level was required for the profession, that the pay had no ceiling and was the same regardless of gender, and that life insurance was rewarding for those who were looking to doing something good for other people.

In the 1980s, the retention of women agents increased to equal that of men, however most of the women entering the field were new. According to the 1984 LIMRA report, 40% of the women agents that year were in their first year of selling.

There was recognition that selling life insurance to women would require a different approach. Women typically needed more information and more time to make decisions. Companies and agents alike were called on to provide additional information and services in order to attract the female market. Women also were believed to trust other women, and were believed to be the decision-makers in the home when dealing with financial concerns.

As we move closer and closer to present day, it will be harder to generalize on the women’s market. We will try, however, to look at the 1990s next.
Sources:
Allen, Frank (1980). “Women Managers Get Paid Far Less Than Males, Despite Career Gains.” The Wall Street Journal, Oct 7, pg 35.
American Council of Life Insurance (1985). “Advertisement: Some People Would Charge Women More.” The Boston Globe, Mar 25, pg 5.
Anonymous (1983). “Did You Know?” Atlanta Daily World, Jul 15, pg 3.
Anonymous (1989). “Life insurance cash for terminally ill.” Chicago Tribune, Jun 15, pg 9.
Anonymous (1980). “The life insurance industry’s relationship with women.” PR Newswire, Sep 16.
Anonymous (1980). “Recruiting Women Agents.” Manager’s Magazine, 55(8), 32.
Anonymous (1981). “Rewarding career for women.” New York Amsterdam News, Jun 13, pg 22.
Anonymous (1981). “Tells WLUC of Disparity in Cover for Women.” National Underwriter, 85(37), 14.
Arndt, Sheril (1986). “WLUC Exec Says Role Models are Key.” National Underwriter, Life & Health Insurance Edition, 90(40), pg 2.
Barnes, Don (1987). “The Woman in life Insurance.” National Underwriter, Life, Health, Financial Services Edition, 91(2), pg 17.
Brostoff, Steven (1989). “AIDS-linked claims jump dramatically.” National Underwriter, Life & Health – Financial Services Edition, 10, pg 1+.
Brozan, Nadine (1980). “Insurance: New Policies Toward Women.” The New York Times, Sep 22, pg. A24.
Burrows, Julie A. (1987). “Start Selling to 50% of the Population!” Insurance Sales, 130(12), pg 20.
Gerstenberger, Paula P. (1981). “The Women’s Unit.” Manager’s Magazine, 56(10), 29.
Jamison, Kent S., Retzloff, Cheryl D. (1987). “What the Numbers Show.” Best’s Review, 88(4), pg 36+.
King, Carole (1984). “Female agents: a progress report.” Best’s Review – Life-Health Insurance Edition, 85, pg 132+.
Kleiman, Carol (1982). “A Portrait of Chicago’s Working Women.” Chicago Tribune, Mar 7, pg J22.
Knox, Richard A. (1987) “AIDS test readied for life insurance.” The Boston Globe, Sep 12, pg 17.
Landes, Jennifer (1989). “AIG Women’s Grp. markets ins. to working mothers.” National Underwriter Life & Health – Financial Services Edition, 50, pg 7+.
Lewin, Tamar (1984). “Women in Board Rooms Are Still the Exception.” The New York Times, Jul 5, pg C1.
Lipson, Benjamin (1980). “Improvements coming in insurance for women.” The Boston Globe, Nov 3, pg 22.
Myers, Ann (1983). “Selling to the Woman on Her Way Up.” Manager’s Magazine, 58(5), 34.
Myers, Ann (1983). “Selling to the Woman at the Top.” Manager’s Magazine, 58(4), 12.
Nussbaum, Karen (1983). “9 to 5: women’s role has changed.” The Boston Globe, Jun 28, pg 48.
O’Connor, Bob (1981). “Beneficiaries to buyers: Women are growing market for life insurance.” The Baltimore Sun, Sep 27, pg T1.
Ross, Nancy L. (1987). “Women’s Group Dealt Setback On Insurance.” The Washington Post, Jun 25, pg F1.
Saltzman, Cynthia (1980). “Troubled Life-Insurance Companies Try Mass-Marketing tactics to Increase Sales.” The Wall Street Journal, Dec 19, pg 50.
Stinson, Marian (1982). “Increasing Financial Clout of Women Attracts Insurers.” The Globe and Mail, May 31.
Weech, C Sewell Jr. (1980). “Internationally Speaking…Women in Life Insurance Sales.” Manager’s Magazine, 55(8), 36.
Wessel, David (1985). “Insurers Battle to Stop Massachusetts From Adoption Gender-Neutral Rates.” The Wall Street Journal, May 20, pg 20.
Wexler, Beatrice L. (1980). “Marketing to Women: Women Really Do Count as Buyers and Decision Makers for Insurance Companies.” Insurance Marketing, 81(6), 26.

Women In Insurance – A History – Black Owned Insurance Companies in the 1970s

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While writing the general post on the 1970s, I found I had a sizable amount of information on black-owned businesses that just did not fit in easily. It seemed important enough to warrant its own post. Of course, this means it also mimics one of the problems with black-owned insurance companies at that time – they were, in many ways, kept separate in the national economy.

Black-owned life insurance companies were formed as far back as 1899, largely developing out of the secret societies and fraternal organizations created to support the black community. Most of these organizations existed to support families in their communities in paying for funerals at the time of death.

In 1970, there were 42 black-owned life insurance companies. This was a significant reduction from the 60 companies in existence twenty years prior. By 1979, this number had decreased to 38. Most of the loss in number was due to mergers between the smaller companies. Of the rest, some companies were purchased by larger white-owned companies looking to capture some of the negro market, and other companies simply failed.

The National Insurance Association (NIA), a trade organization for the black-owned life insurance companies across the US, was formed in 1921. In 1970, only two of the member companies ranked in the top 400 life insurance companies; the largest was ranked at 299. In 1974, all member firms had nearly $3 billion of insurance in force, and held $451 million in assets.

In 1971 black families held less insurance on average than white families. This was largely due to the heavy concentration of blacks in the lower income brackets. A study completed in 1971 (Starr Roxanne Hiltz) found that even within income brackets, black families still held less insurance. In 1970, the average policy in force for black families had a face value of $2,126, up from $593 in 1960. This compares to $3,461 average policy face amount across the entire industry, up from $2,000 in 1960.

The findings from this study indicate that there were three main reasons for this. First, blacks tended to own more expensive insurance, so it was difficult to afford as much. Much of the insurance written on black lives at this time was debit (also called industrial) insurance, where premiums were collected by agents going door-to-door on a weekly or monthly basis. Because of the extra work required by the agents, the companies charged higher premiums.

In addition, mortality rates were higher for blacks at that time, driving up the price. Ivan J. Houston, chairman of the board of Golden State Mutual Life Insurance Co. explained in one interview that the higher mortality rate was attributed to “a higher rate of homicide, accidents, and a lack of adequate health care” (Black Enterprise, June 1979).

Second, manual laborers of both races tended to hold less insurance than white collar workers, and with a heavy concentration of blacks in that segment of industry, their life insurance dollars were suppressed. Finally, women tended to be the heads of household in black families, and women in general held less insurance at that time.

Prior to this decade, white companies did not actively pursue the negro market. In some instances, these companies actively avoided this business, and some even declined this business. That began to change in the 1970s as the general market growth slowed considerably and white companies looked for new areas of expansion. Suddenly, black-owned companies found themselves in direct competition with the white companies for sales they could have counted on in the past.

Sales from black-owned life insurance companies comprised only one-half of one percent of all life insurance companies in 1970. Suggestions were made by scholars and journalists on how to help black companies grow and continue to be alive and healthy. One suggestion put forth was for black companies to aggressively enter the white market, something many of the companies had tried on a limited basis beginning in the 1960s. One author felt this would be an extraordinarily difficult task, stating:

At our present stage of race relations, such a relationship, with the black in the advisor role, will be achieved neither widely nor easily.

On the other hand, it could be that being black in the white market actually worked as a benefit where the white customer “acting out of social consciousness may prefer black agents” (Duker & Hughes, 1973, pg. 223).

Another suggestion was that the black companies could rely on a “buying black” sentiment to continue to grow in their traditional negro market. Because the market had been built to serve the negro market when white companies refused to do so, some companies felt they could build on the pride blacks felt in the industry to keep them with black-owned businesses. The president of United Mutual Life of New York, Nathanial Gibbon was quoted as saying:

We need more clout so we can have greater input on legislative and regulatory matters, and this can only come from increased participation by blacks in black insurance institutions.

One thing almost everyone agreed to – the black companies had to move beyond the debit policies on which they had built their companies. The general feeling was that the black insurance industry had approximately 10 years to develop new products and markets, the idea being that in general the black market tended to trail approximately a decade behind the white market.

The black-owned life insurance companies were also facing direct competition from white-owned companies for personnel. One reason for this was the push for equal opportunity in the white companies. The white companies were using sophisticated means to recruit black talent including regular visits to college campuses and partnerships with several national black organizations. There are also some hints in the press of white companies poaching top talent from the successful black companies. The white companies were often able to offer higher salaries, additional training programs, and greater promotional opportunities.

aetna ad 1970

In a particularly interesting article, four men who had been recruited to sell for white insurance companies discussed their experiences. One young successful man, with just two years of experience under his belt shared:

I was the first black man hired by my company in the city, and I feel like everyone was watching me. I knew that if I was a failure they would look at every black as being a failure and say that black people just were not interested in supporting black insurance men.

Black Executive, March 1974

Another man, a sales manager with a significant number of years in the industry shared his belief that it was his responsibility to be successful so that others could see it was possible. He said:

I think success breeds success and that success of the early million dollar producers made everyone realize that there was a black market out there, that it did have money, and it was willing to buy insurance to meet his needs. It’s required an education, but now I think we’ve got across the idea that black people have the same types of aspirations, the same types of abilities as white people have. And I mean that to cover the buying of the insurance as well as the selling of it.

Black Executive, March 1974

The top black-owned insurance companies during the decade were North Carolina Mutual, Supreme Life Insurance Co. of America, and Golden State Mutual Life Insurance Company.

North Carolina Mutual opened for business in 1899 in Durham, North Carolina, in order to provide black families with life insurance the white-owned companies refused to issue. By 1974, the company had over $2 billion insurance in force, putting the company at 177 out of 1,810 insurance companies. Over 97% of the policy owners were black.

In order to continue growing, the company made the decision to enter the white market and to aggressively pursue white salesmen. Initial efforts proved this would be a rather difficult endeavor, with most agents leaving the company after only 6 months.

The company also held over $138 million in total assets in 1974, putting the ranking at 150th by this measure. The company employed over 1,300 individuals, nearly all of them black. The company also employed 750 sales agents, many of whom were women.

Over 60% of the business North Carolina Mutual wrote was industrial/debit insurance. The balance was group insurance and ordinary life insurance policies. In the 1970s, the company acquired several other black-owned life insurance companies including Unity Mutual Life from Chicago and Great Lakes Mutual of Detroit.

Golden State Mutual was formed in 1925 as the only black-owned life insurance company on the West coast. The company was almost exclusively focused on debit insurance sales, but decided in 1974 to begin focusing more on middle- and upper- income brackets as black incomes began to climb.

In 1979, Golden State Mutual was the second largest black-owned firm in the West after Motown Records. The company was licensed in 20 states and Washington D.C. The average sized policy the company sold at this time was $2,500 with a monthly premium of $8.35, collected by agents going door-to-door on a monthly basis. Approximately 57% of the company’s insureds were women, reflecting the tendency for women to be the head of household in the black communities.

Golden State had 722 agents, and at the end of the decade had $2.5 billion of insurance in force which included a significant amount of reinsurance and group insurance.

In large part, the black-owned life insurers did not participate heavily in the social movements of the day. The CEO of North Carolina Mutual, William J. Kennedy 3d, was quoted as saying:

Our role is not to become involved in social issues because we feel we can do black people more good in another sense – as an economic symbol. Many of our individual members get involved in social causes. But for the company I think it is necessary that some element in the black community work from the inside as much as possible.

New York Times, 26 May 1974, pg 131

That said, the company did provide loans to black homeowners and business men who could not find money at white-owned institutions.

At the close of the decade, the biggest black-owned insurance companies remained strong. North Carolina Mutual, by far the largest of the group, was well ahead of the others with over $4 billion in force, nearly $170 million of assets, and over 1200 individuals, both black and white employed.

The industry ended the decade healthy and with strong plans for growth in the 1980s. While integration was not fully under consideration, it did appear to be the way of the future. With white-owned insurance companies recruiting black employees and sales representatives, and black-owned insurance companies recruiting white employees and sales representatives, it seems that an integrated insurance landscape was destined to come.

Sources:
Anonymous (1978). “How Insurance Companies Invest Their Money.” Black Enterprise, June, 157-164.

Anonymous (1977). “Insurance Companies: An Overview.” Black Enterprise, June, 121-127.

Anonymous (1975). “North Caroline Mutual: Reaches Two Billion.” Black Enterprise, June, 57.

Anonymous (1979). “Ordinary is Extraordinary for Golden State.” Black Enterprise, June, 197-201.

Anonymous (1974). “Seventy-Six Years of Black Insurance.” Black Enterprise, June, 141-145.

Duker, Jacob M., Hughes, Charles E. (1973). The Black-Owned Life Insurance Company: Issues and Recommendations. Journal of Risk and Insurance, 40(2), 221-230.

Hiltz, Starr Roxanne (1971). Why Black Families Own Less Life Insurance. Journal of Risk and Insurance, 38(2), 225-235.

Parker, Robert A. (1974). “Four Black Salesmen in a White Company.” Black Enterprise, March, 59-61, 71-72.

Puth, Robert C. (1974). Can Black Insurance Companies Survive? Challenge, May-June, 51-59.

Smith, Faye McDonald (1977). “Atlanta Life: 72 Years Old and Still Looking Ahead.” Black Enterprise, June, 133-139.

Stuart, Reginald (1974). “Prudent Insurer Is A Black Business Symbol.” New York Times, 26 May, 131.

Women in Insurance – A History – the 1970s

prudential 1970sIf the 1960s were a tumultuous decade in the US, the 1970s were simply a continuation of the chaos. With the protests against the war in Vietnam, the continued push for the Equal Rights Amendment, the fervent backlash to that legislation, and the resignation of a President under the threat of impeachment, the decade was full of controversy.

In 1972, Congress amended Title VII of the Civil Rights Act of 1964 to allow the EEOC (Equal Employment Opportunity Commission) to go directly to court to enforce the civil rights legislation. This resulted in significant litigation and settlements with companies reaching hundreds of millions of dollars. Many companies worked hard to comply, but sometimes the discrimination was so ingrained in a company’s culture, it was not easy to fix.

This increased litigation led to significant push-back on the EEOC and the aims of the agency. The criticism came from many directions. On one hand, the complaints coming in from employees who were reporting discrimination were so great in number, a backlog of 130,000 had amassed by 1977. This meant that most employees never saw their complaints addressed. On the other, corporations certainly did not want to face settlements or judgments that would cost them significant amounts of money.

In one instance that caused significant disturbance in the press, John Hancock Mutual Life Insurance Co. made what the Wall Street Journal referred to as a “surprise move” in 1978, and refused a request from the EEOC for personnel recorders for an examination of compliance with the anti-discrimination legislation. A government official is quoted as saying, “John Hancock…fears what the records will reveal. Historically, insurance has been a white male profession at the managerial level, a white female profession at the clerk level.” Meanwhile, John Hancock maintained that the government was overstepping it’s authority, and had not followed its own rules in making the request. Additionally, an official from the company stated the dispute was just another instance of “additional, continuing, increasingly oppressive…government intrusion that is counterproductive” (Wall Street Journal, 17 Feb 1978).

If women and minorities fought at the highest levels (legislation, etc) to reach equality during the 1960s, it was the 1970s when they began to insist and truly fight for those rights on the ground.

INSURANCE DURING THE 1970S

The growing inflation during the 1970s was a significant issue for the life insurance industry, now comprised of over 1,700 firms. Rising from 4% in 1971 to over 13% by 1980, policy owners saw the value of their insurance eroding as the cost of living grew. Insurance companies and their agents had to find new and innovative ways to sell their products. Because of the rising interest rates, loan and surrender activity grew significantly. Policy owners found that they could withdraw their money and reinvest it elsewhere for greater returns. Tax laws were undergoing significant changes, and insurance company investment strategies had to be restructured to meet this new economic environment.

In the middle of the decade, the amount of life insurance in force had reached over the $2 trillion mark. This continued to climb as the face amounts of policies increased, largely due to inflation. By the end of the decade, it had climbed to over $3 trillion. By 1974 and through the end of the decade, it was estimated that over 90% of all husband-wife families carried some amount of life insurance. Average amounts of coverage for this group were $25,200 per family, where the family had a mean disposable income of $11,200. The number of policies in force reached a plateau in the middle of the decade, climbing only slightly by the end of the decade. This slow-down in growth of policy numbers foreshadowed a decline in the number of policies in force in the 1980s.

The life insurance industry now found itself in considerable competition for household savings, given the higher yields investors could reap in alternative investments. Whole life insurance was no longer the attractive investment it had been for the last many decades. It is precisely this environment that gave birth to a new type of policy, the Universal Life Insurance policy. It was also this environment that gave fuel to the debate over whether an individual should buy an “ordinary life” (or whole life) policy or a “term life” policy and invest the difference.

The number of insurance agents during the decade was estimated at 135,000 at the beginning of the decade, growing by almost 100,000 by the end of the decade. The retention rates for these agents were, however, dangerously low. One study found that two year retention rates were at 39%, dipping to a very low 13% by year five of the agent-company relationship. Many reasons were given for this very low rate, including a lack of training offered to new recruits, a lack of continuing education for those already hired, and the unstable income of agents when they first began their careers.

New types of employment opportunities began to develop in the industry. With advances in technology, companies were now looking for computer operators, programmers, and system analysts instead of the file clerks and assemblers of the past. Overwhelmingly, these new positions were filled by men while the clerical and administrative work was nearly 100% handled by women. Overall, there were approximately 1.5 million insurance company employees nationwide.

WOMEN IN LIFE INSURANCE DURING THE 1970S

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In the 1970s, women were graduating from college and joining the workforce in ever-increasing numbers. Because of the limited number of possible occupations for women, this led to a significant issue. A Labor Department report from 1970 cautioned that if women did not expand the range of careers for which they prepared, strong competition would develop in the female labor market. The same report spoke to a coming shortage of chemists, dentists and physicians, careers typically filled by men.

By 1973, more than 19.8 million married women were a part of the workforce, and from 1961 to 1973, there was an 86% increase in the number of married women who had both children and a job. In 1976, there were nearly 35 million women in the workforce, and 60% of them were married.

At the same time, businesses were beginning to understand the importance of a diverse workforce. In one article in The Baltimore Sun, the CEO of a mid-west mutual fund company was quoted as saying “It makes good business sense to bring interested and motivated women into the financial services industry. After all, our products such as life insurance and mutual funds represent security to millions of Americans. Who knows more about security than a woman?”

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Companies that were not as successful in understanding the need to employ minorities faced major lawsuits. A landmark settlement in 1973 with AT&T called for an immediate payment of $15 million in back pay to women and minority employees, and an additional $23 million budgeted for future wages and promotions. Overnight, recruitment for women and minorities went up dramatically across all industries. A year later, however, women were still not making it to the executive suite, in most cases seeing their careers stall out at the middle management level. In 1974, there were 268 seats on the boards of directors for the largest insurance companies. Of those, not a single one was filled by a woman. In 1976, 97% of the individuals earning a salary over $15,000 were white males. In 1978, the EEOC settled a sex and race discrimination suit against Farmers Insurance Group for $1.5 million. One of the issues holding women back from the executive suite: in 1974, only 5.5% of all graduate and doctoral business students were women.

In 1970, the Institute of Life Insurance put out a publication entitled, “Your Financial Worksheet, a Guide for Women Returning to the Job,” with the purpose of helping women determine whether they could afford to work. The guide suggested a woman take into account taxes, child care, lunches, additional wardrobe, grooming, transportation, among other things, before she decides to return to work. While certainly meant to be helpful, a contemporary perspective shows this to be counter to efforts toward equality for women, encouraging them to stay home.

In decades past, the life insurance industry seemed to stay out of the social and political drama of the times. In the 1970s, this changed. The Equal Rights Amendment affected the industry directly and the industry was forced to react. In 1971, the largest companies operating in New York made a joint announcement that they were committed to at a minimum ‘doubling the number of minority group members and women in technical, sales, professional and executive jobs in two years.’

Some companies reported having already begun addressing the inequality of minorities in hiring and promotion activities. Equitable claimed that in 1971, 40% of new hires came from minority groups and of those, 13% were in executive training programs. Equitable found particular value in hiring black women, and worked to recruit and promote them. Metropolitan Life reported efforts to visit black college campuses in order to recruit minorities to that company. In 1977, they launched a major campaign to recruit minorities, especially women, into their sales force.

Regarding the purchase of life insurance, an interesting article in the New York Times reported that while young business men were typically receiving a call from an insurance salesman once every month, young business women, whether married or single, were never approached. It is not surprising then that in 1972 women carried on average $9,700 in insurance while men carried an average of $20,000 in insurance. The article makes the following statement: “…It gives the insurance man a new approach – selling insurance to the wife for her own benefit,” as if it were a new and novel concept. Another article from 1974 states, “…Very little attempt is made to sell insurance to women. The industry admits that agents (who are predominantly male) often do not take women seriously about insurance and will make their presentations only when the husband is at home.”

Thelma 1971

By 1978, the situation may have been changing. Insurance companies seemed to be awakening to “The Female Market.” Single women were now reporting more calls from agents, and some agents were beginning to understand the value of selling to working married women. Awareness of the fact that it would take more than a new marketing campaign or new product was growing. It would, however, take a major attitude shift to reach the women’s market.

In 1978, Monumental Life Insurance Company released a kit to help agents sell to the female market. Among the helpful hints the company urged agents, “If [the prospect] is single, don’t imply she will not marry…Expect many questions – Generally a woman will ask more questions than a man since she has had less opportunity to discuss life insurance.” These comments certainly seem funny from today’s perspective.

Throughout the decade, however, the amount of insurance carried by women was still significantly below that of men. In 1976, the amount of insurance carried by single women had increased to $28,400, but single men had also increased the amount of insurance they carried, up to an average of $31,000. At the beginning of that year, women owned $325 billion of life insurance, a new record, and a 150% increase from a decade earlier.

In addition, an old debate continued. Should a married woman carry insurance? In a column of the New York Times, Personal Finance, the reporter shared arguments from both sides, two years apart. In 1971, she discussed the need for “wife insurance,” arguing that the value of a wife had increased to a point where it should be insured.

In 1973, she shared that in many families, the money that would be spent on insurance was instead being spent on training and educating the wife for a career. Other reporters throughout the decade shared other opinions on the difficulty in the determination of whether to insure a wife. One life insurance agent explained, “It is fine for a woman to have full coverage, but, generally, if a working woman dies, her husband can get along okay as long as he can work…If he needs a loan, it’s easier for him to get one than it is for a woman.”

Mary Roberston 1972

In 1975, due to the increased attention on sales to women, insurance companies began to examine the life expectancy of insured women. At this point many of them decided to increase the set-back from men’s policies to 4 or 5 years, from 3 years as they had done in the past. This meant premiums became even lower for women. By 1978, separate mortality tables were being developed for women.

The data indicates that more women were purchasing more term insurance than ever before; over 4.3 million women took out term policies in 1972, a 20% increase from a decade earlier.

WOMEN AS LIFE INSURANCE AGENTS IN THE 1970S

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The number of women selling life insurance in the 1970s had not shown marked increases from decades past. In 1977, there were approximately 4,000 women selling life insurance out of a total of 135,000 agents. The women who did choose the profession, however, seemed to do well.

In 1975, the “Top Salesman” for Prudential Life Insurance company was a woman, Mrs. Estelle Holzer. That year, she sold $2.4 million of life insurance and garnered the prizes that came along with the award. In an amusing article in the Los Angeles Time, a company official explained that the award consisted of a silver trophy in the shape of a man carrying a briefcase, a men’s suit with three tie tacks and a pair of cufflinks, among other ‘male-oriented’ items. Clearly, they were not expecting a woman to win. Mrs. Holzer was quoted as saying:

Men, both co-workers and clients, don’t think we women are in this seriously…Men assume that because you are not the breadwinner in your family, you are working because you have nothing better to do or because you’d simply like a little extra spending money. Therefore, a woman has to work much harder to prove her worth and ability.

In 1975, only three women in Maryland held the CLU (Chartered Life Underwriter) designation. By 1977 nationwide approximately 770 women had earned the CLU, with approximately 125 new women qualifying each year. In 1972, 490 women qualified for the Women Leadership Round Table ($350,000 in sales or higher), 38 of whom qualified for the Million Dollar Round Table. In 1976, these numbers had jumped to 985 for the Women Leadership Round Table and 78 who qualified for the Million Dollar Round Table.

A New York Times article from 1975 (Aug 24, pg 78), reminiscent of similar articles from decades past opens:

Steady, men. That friendly woman’s voice on the telephone may not be the life insurance agent’s secretary. It may well be the life insurance agent herself.

Slowly – and activists in the field contend, far too slowly – life insurance companies are awakening to the marketing potential of women agents.

A similar argument for women entering the field was presented several times throughout the decade. In 1978, an article in the Chicago Tribune read:

The advantages of a career in insurance sales for women is that it lacks discrimination in both earning potential and public acceptance…In insurance sales, a woman can enjoy unlimited earning potential – agents are paid on the basis of results, not seniority or sex.

Sources:

Anonymous (1978). “An Insurer Accepts $1.5 Million Accord In Job-Bias Dispute.” The New York Times, 4 Jan, B4.

Anonymous (1972). “Black Woman Appointed to John Hancock Board.” Wall Street Journal, 9 May, 32.

Anonymous (1970). “Chasing Women Viewed as Good for Business.” The Baltimore Sun, 11 Dec, C13.

Anonymous (1976). “Insurance Can Mean Happily Ever After.” Atlanta Daily World, 1 Jul, 16.

Anonymous (1971). “Insurance firms agree to fair promotion policy.” The Baltimore Afro-American, 25 Dec, 3.

Anonymous (1974). “Marriage or Career? ‘Both’ Cry Women.” Atlanta Daily World, 11 Oct, 5.

Anonymous (1973). “More Women Buying Term Life Insurance.” Los Angeles Times, 9 Aug, C2.

Anonymous (1975). “Mrs. Tall, first woman in state to hold CLU.” The Baltimore Sun, 13 Sep, A13.

Anonymous (1971). “United Mutual Names First Woman Director.” New York Amsterdam News, 3 Jul, C16.

Anonymous (1970). “Women’s Career Market.” The Washington Post, Times Herald, 6 Dec, F3.

Anthony, Toni (1971). “A woman’s niche in a growing field.” Chicago Daily Defender, 29 Jun, 18.

Auerback, Alexander (1974). “Women Aim Sights at ‘Chauvinist’ Insurers.” Los Angeles Times, 3 Feb, H1.

Bralove, Mary (1974). “Where the Boys Are.” Wall Street Journal, 18 Apr, 1.

Brookins, Portia S. (1977). “Metropolitan Recruits Minorities In Sales.” Atlanta Daily World, 30 Jan, 2.

Caralmela, Edward J. (1973). Staffing and Pay Changes in Life Insurance Companies. Monthly Labor Reivew, Aug, 66-68.

Carmichael, Carole A. (1978). “Diverse groups find opportunity in insurance.” Chicago Tribune, 17 Dec, ND1.

Cray, Douglas W. (1977). “Life Insurers Putting Premium on Women.” New York Times, 24 Aug, 78.

Curry, Timothy, Warshawsky, Mark (1986). “Life Insurance Companies in a Changing Environment.” Federal Reserve Bulletin; Federal Reserve Bank of St. Louis, July, 449-460.

Fowler, Elizabeth M. (1973). “Women May Find Numerous Benefits Are Possible Through Life Insurance.” New York Times, 8 Mar, 55.

Johnson, Thomas A. (1971). “Rights Accord Set on Insurance Jobs.” New York Times, 11 Dec, 1.

Kleiman, Carol (1970). “Does it Cost You to Work?” Chicago Tribune, 26 Apr, F15.

Maynes, E. Scott, Geistfeld, Loren V. (1974). The Life Insurance Deficit of American Families: A Pilot Study. The Journal of Consumer Affairs, Summer, 66-81.

McElheny, Marge (1975). “Top Saleswoman in ‘Man of the Year.'” Los Angeles Times, 23 May, F16.

Mills, Kay. (1976). “Single Women Found Underinsured.” Los Angeles Times, 14 Mar, F19.

Rousmaniere, James A. Jr. (1978). “Women’s Insurance Gains New Status.” The Baltimore Sun, 19 Feb, K7.

Stuart, Reginald (1975). “Personal Finance: Women’s Policies.” New York Times, 4 Sep, 48.

Taylor, Angela (1974). “To Women, Insurance Companies Are at Fault on Many Things.” New York Times, 9 Feb, 35.

Umble, M. Michael, York, Paul F., Leverett Jr., E.J. (1976). Agent Retention Rates in the Independent Agency System. The Journal of Risk and Insurance, 481-486.

Women in Insurance – A History – The 1960s

women 1960sThe 1960s were a turbulent time for the US. In 1961, John F. Kennedy was elected President, the youngest person at that time to be elected to the position. The remainder of the decade was overshadowed by the assassinations of President Kennedy (1963) and Martin Luther King, Jr. (1968), the Vietnam War, the on-going Cold War with Russia including the Cuban missile crisis, and the Civil Rights Movement.

As part of his larger legislative agenda, President Kennedy signed into law the Equal Pay Act of 1963. This legislation made it illegal for employers to discriminate job wages by sex for jobs requiring the same level of skill, effort, and responsibility. Congress stated the following in passing the bill (Sec. 2 of the Act):

The Congress hereby finds that the existence in industries engaged in commerce or in the production of goods for commerce of wage differentials based on sex:

(1) depresses wages and living standards for employees necessary for their health and efficiency;

(2) prevents the maximum utilization of the available labor resources; (3) tends to cause labor disputes, thereby burdening, affecting, and obstructing commerce;

(4) burdens commerce and the free flow of goods in commerce; and

(5) constitutes an unfair method of competition.

It is hereby declared to be the policy of this Act, through exercise by Congress of its power to regulate commerce among the several States and with foreign nations, to correct the conditions above referred to in such industries.

In 1964, President Lyndon B. Johnson signed the Civil Rights Act into law. This put an end to legal segregation in schools, theaters, restaurants, movie theaters, and in any action by state or federal governments. It also banned employment discrimination based on race, religion, color, sex, or national origin. It was a victory hard won after many protests, some of which had turned violent. There is an interesting debate over how “sex” became included in this bill. There are a number of stories suggesting that the senator who added this particular amendment did so in order to convince others not to vote in favor of the legislation. Regardless, it passed both the Senate and the House in 1964.

Throughout the decade the war in Vietnam divided the country. Riots, protests, and sit-ins took place across the nation. At the same time, the country was dealing with the escalation of the communist regime with the failed Bay of Pigs Invasion and the Cuban Missile Crisis. The assassination of Martin Luther King, Jr. in 1968 set off a number of riots and protests across the country.

Despite all of this chaos and violence, the decade closed out with the concert at Woodstock, where on a rainy weekend in August, over 400,000 people gathered to share peace, music, and love.

LIFE INSURANCE DURING THE 1960S

During the 1960s, the intense competition that had begun in the 1950s continued. Companies escalated their endeavors to introduce new products and new features.

In the early 1960s, the industry was facing competition from stocks and mutual fund investments, slowing the significant growth of the previous decade. This was reasoned to be due to growing sales in group insurance and continued inflation that might have reduced the real value of the life insurance. New life insurance sales (ordinary and industrial) totaled $59.8 billion in face amount that year. This brought the total amount of insurance in force to $585 billion, $175 billion of which was group life.

In 1966, life insurance in force crossed the trillion dollars mark for the first time, reaching $1,045 billion. New sales for that year were $122.5 billion, one of the largest gains in the history of the industry to date.

Face amounts of life insurance policies were growing. Massachusetts Mutual reported in 1960 that it had 40 policy holders with more than $1 million in coverage, three of which were women. Of the 40, seven individuals had greater than $2 million in coverage. In 1962, the company reported its largest benefit payment in its history, a $2 million benefit paid out on a business man. In 1960 New York Life reported 34 sales over the million dollar mark, three of which were women, and Equitable Life Assurance Society reported 14 sales over the same amount, three, again, which were women. At the time, the average size policy on an adult male was $11,300 and on an adult female was $3,000.

Credit insurance became one of the fastest growing segments of the life insurance industry. In 1966 over 70 million policies were issued for over $62 billion in coverage.

In the 1960s, the most successful black-owned companies were the life insurance companies. Surveys showed that 80% of black families held life insurance. One company at the time was fully integrated, that being Progressive Life Insurance Company, based in Red Bank, New Jersey. The company had several black executives (all male) serving in many areas of the company, although in 1964 the company as yet had not elected a black member to the board of directors.

WOMEN IN LIFE INSURANCE DURING THE 1960S

The number of women in the US workforce continued to grow throughout the decade much as it had over the last several years. By 1964, the number reached 22 million women workers, and by 1969, had reached 27 million. In 1963, white-collared women outnumbered white-collared men. These women largely filled clerical and lower paid jobs, but slowly but surely they were rising in the ranks. Already in 1960, the Census Bureau classified just over one million women as ‘managers, officials and proprietors’, up from 450,000 in 1940. Also, Harvard Business School opened its MBA program to women for the first time in 1963 to help train women for the higher ranking positions.

In the 1960s, the life insurance industry employed approximately 500,000 people, 1/3 of which were women. These women primarily filled clerical roles within the home offices. In 1963, 25 of the 1,325 fellows of the Society of Actuaries were women. By 1966, this number had only risen to 26.

Leadership and management were still largely a man’s world. Many times women were held back by the fear that they would soon leave the workforce to raise a family. Other times, it seems that women held themselves back, lacking the full confidence to deal with the struggles of getting ahead.

Women reported having to work harder than men to get ahead, and had to be better than men to retain the same rank. Some women clearly believed that to become an executive, a woman had to dedicate herself fully to her career, foregoing a husband and children. A Wall Street Journal article from 1963 quoted a female executive saying, “Men doing the same sort of work advanced more rapidly. They would climb two rungs up the ladder while I climbed one.” A Harvard Business School survey from 1965 found that 41% of business men “viewed female executives with undisguised misgivings” (Newsweek 1966).

Still, women did succeed. One woman, Margaret Brand Smith, a lawyer from Dallas, formed and sold a number of life insurance companies, finally, due to a merger, becoming president of Union Bankers Insurance Co. of Dallas. One employee paid her the compliment (?), “Talking to Margaret is just like talking to a man.”

Much like the 1950s ended, the 1960s began with a number of “first women.” Mrs. Viola G. Turner became the first women elected to the board of directors for North Carolina Mutual Life Insurance Company. She was elected vice president and treasurer of the company at the same time. Lillian Hogue, an agent for New York Life, was elected the first woman president of the American Society of Chartered Life Underwriters. In 1968, Mrs. Amelia Reichert was the first woman elected to the level of vice president at New York Life.

In addition, there were regular updates in the press regarding the formation of the first woman’s life insurance company, Woman’s Life Insurance Co. of America, headquartered in Bethesda MD. The company was formed in order to address the fact that, according to a study conducted by the founders, “women would seem to be the most natural prospects for the life insurance product, yet only 13 percent of the $493 billions of life insurance in 1958 was owned by women.” The company began writing policies on January 1st, 1962.

The company was headed by Phyllis R. Biondi, a 36-year old woman who had worked as assistant to the general agent for another insurance company. Press releases indicated that while policies would only be sold to women, men would be represented in management and in the field force. In 1965, the company secured additional necessary funding. The president of the investor company, Inter-Ocean Insurance Company of Cincinnati, was quoted as saying, “We believe enough women will prefer to select their life insurance from a company managed by women and dedicated to serving only their financial problems enough to give this company every chance of success.”

In the industry, new mortality tables were developed that showed that women were living longer. In one article, this was described as a way to “flatter” women while saving her money. The article (Washington Post, Times Herald, 22 Mar 1960) reads:

New mortality tables developed by the National Association of Insurance Commissioners show that women live an average of six to seven years longer than men. The Insurance Commissioners decided that three years was a nice, safe – and, it might be added, still flattering – bonus for the ladies.

Companies were aiming their advertising more and more toward women. One example given in a Wall Street Journal article from Travelers Insurance shows a woman, Laura, who once shuddered at the idea of life insurance but now realizes that it is her husband’s way of protecting her and her son. In another ad featuring a women’s consultant, it reads “insurance is as much a woman’s business as shopping for tonight’s dinner” (Printers Ink, 1962).

Throughout the decade there were acknowledgments of the women’s market, sometimes referring to it as a “new market,” and sometimes as a “growing market.” One headline from Printers Ink (1962) read “New Ways to Reach The Women’s Market,” and opened saying “American women today represent a colossal market – one so large that a marketing executive recently described it as ‘a whole new country’ for many advertisers.” Later in the article the author addresses life insurance directly:

Portions of the life insurance industry have also discovered women and are engaged in an education program for women policyholders, both actual and potential…Insurance companies have become aware, too, that women can have an important influence on the purchase or nonpurchase of policies.

An article from the New York Times was headlined “Growing Market Noted Among Working Women.” Another headline shared the news, “Brochures on Insurance Are Written for Women.” This particular article pointed out that “women know more about family finances than they did twenty years ago and, as a result, are demanding answers to questions about insurance.” One article from the Wall Street Journal was titled “She’s the Boss; More Women Conquer Business World’s Bias, Fill Management Roles.”

The Atlanta Daily World printed an article in 1963 titled “Girls! Career In Life Insurance Beckons To You,” that talked about the wide variety of careers available to women in the insurance field. From high-schoolers to college graduates, from single to married women, from urban to rural dwellers, there was a job in the insurance industry for any “girl” or woman. The types of jobs suggested included electronic data processing, accounting, advertising, and others, but did not include any mention of management or executive opportunities.

At the end of 1965, women owned more than $130 billion in life insurance and were expected to reach $140 billion by year end 1966.

WOMEN AS LIFE INSURANCE SALES AGENTS DURING THE 1960S

Just as insurance companies were recognizing women as home office associates and sales targets, they were looking at women as sales agents as well. An article in National Business Woman from 1963 was titled “Life Insurance Welcomes Women.” The article begins:

As more and more women are awakening to the opportunities available in life insurance selling, life insurance companies are awakening to the fact that women can do the job.

In 1960, it was estimated that there were 200,000 full-time agents selling life insurance in the US, only 5,000, or 2.5% of which were women. Only 1% of these women were agency managers and assistants. This was a reduction from 1945, during the war, when women made up 5% of the total agents. By 1968, the number of female agents had risen to 11,000. An article in the Baltimore Afro-American newspaper from December 16, 1961 stated:

Although life underwriting [selling] is an occupation well suited to women, traditionally, very few have been in this area of work. Why this situation prevails is not clear. Women in the field are enthusiastic about life underwriting as a career…Insurance selling is a field of work in which women consistently earn at the same rate as men. Compensation schedules are fixed by each company. They appear in the contract and apply equally to both sexes.

BettylouA question and answer column in The Los Angeles Times (Nov 12, 1960) shows the rising consciousness of the women in this industry:

Question: It is indeed a pleasure to see life insurance problems discussed objectively in my favorite newspaper.

May I, please, however, make one suggestion. Several thousand women in the United States are now selling life insurance. I am one of them, and I believe I speak for the others when I say we will appreciate it if, in answering questions, you will find some way to avoid implying that life insurance information, advice and service can be obtained only from men.

Instead of “talk this over with a life insurance man,” couldn’t you suggest that the reader discuss the problem with an “underwriter” or an “agent?”

John Hancock formed an experimental training program in 1961 to train female agents. The intent was to provide additional access to the women’s market, believing that women would be more likely to purchase life insurance from other women. Metropolitan also launched an initiative in 1963 to recruit more women as agents. New York Life claimed to not have a specific program for hiring women, but boasted the highest number of women who qualified for the Women Leaders Round Table (sales exceeding $250,000) in 1962, and for the 18 years before that.

While women were certainly making strides forward during this decade, it is clear that the workforce was not yet welcoming them with open arms. A handful of women were successfully navigating the career ladders, but the path was difficult and certainly not clear. The language used around women, often referring to them as “girls” or “gals” as well as the tendency to see successful women as an aberration or singular situation continued, unfortunately, beyond the end of this decade.

Up next, the 1970s.

Sources:
Anonymous (1965). “$300,000 Invested in Woman’s Life.” The Baltimore Sun, Jan 24, pg. D14.

Anonymous (1960). “All Life Insurance Agents Aren’t Men.” Los Angeles Times, Nov 13, pg. E14.

Anonymous (1962). “Brochures on Insurance Are Written for Women.” New York Times, Jan 30, pg. 33.

Anonymous (1967). “Credit Life Insurance One of Fastest Growing Kinds.” Chicago Tribune, Nov 13, pg. E7.

Anonymous (1963). ” Girls! Career In Life Insurance Beckons To You.” Atlanta Daily World, Feb 5, pg. 2.

Anonymous (1962). “Growing Market Noted Among Working Women.” New York Times, Sep 23, pg. 167.

Anonymous (1962). “Life Insurance Firms Pays Biggest Claim: $2 million.” Wall Street Journal, Nov 13, pg. 12.

Anonymous (1961). “Men Too Risky, Insurance Firm Issues Policies for Women Only.” Boston Globe, Dec 23, pg. 12.

Anonymous (1960). “More People Buying Million Dollar Life Policies, Firms Say.” Wall Street Journal, Dec 12, pg. 8.

Anonymous (1962). “New Ways to Reach The Women’s Market.” Management Review, 51(6), pg. 20.

Anonymous (1968). “New York Life Names Woman Vice President.” The New York Times, Jun 5, pg. 68.

Anonymous (1960). “N.C. Mutual Life Insurance elects first woman to board.” The Baltimore Afro-American, Jan 30, pg. 19.

Anonymous (1963). “She’s the Boss; More Women Conquer Business World’s Bias, Fill Management Jobs.” Wall Street Journal, Feb 19, pg. 1.

Anonymous (1966). “Women at the Top.” Newsweek, Jun 27, pg. 70-73.

Anonymous (1961). “Women’s World: Life insurance underwriting open to mature, young women.” The Baltimore Afro-American, Dec 16, pg. 12.

Bromage, William (1967). “The Women’s Corner.” Chicago Tribune, Aug 14, pg. 6.

Equal Opportunity Employment Commission: https://www.eeoc.gov/laws/statutes/epa.cfm

Goodman, Oliver (1960). “First Woman’s Life Insurance Firm Set.” The Washington Post, Times Herald, May 8, pg. C12.

Haitch, Richard (1968). “Private Flying: Woman Finds Exciting Way to Sell.” New York Times, Mar 3, pg. 90.

McVicker, Vinton (1961). “Life Insurance Push: Sales Efforts Intensify As Growth in Individual Policy Business Slows.” Wall Street Journal, Sep 18, pg. 1.

Nichols, Edwin (1962). “The Women’s Corner.” Chicago Daily Tribune, Jul 9, pg. C10.

Reichert, Amelia E. (1963). “Life Insurance Welcomes Women.” National Business Woman, July, pg. 20-21.

Segre, Claudio (1963). “Life Insurers Hire Women Agents to Tap Large Distaff Market.” Wall Street Journal, May 9, pg. 1.

Todd, George (1964). “Progressive Life Insurance No Newcomer to Integration.” New York Amsterdam News, Feb 22, pg. 9.

 

Women in Insurance – A History – The 1950s

1950s

Following the end of World War II, the US experienced a post-war economic boom. Having dealt with rationing for several years, Americans were ready to spend. Consumerism expanded rapidly, as did the suburbs. Many women, having entered the workforce during the war, now found that they wanted to stay. This allowed families, now with two incomes instead of one, to increase their standard of living.

In 1950, the Korean Conflict broke out, and throughout the 50s the Cold War and McCarthyism continued to develop. Army General Dwight D. Eisenhower, a WWII hero, was elected president in 1952 and reelected in 1956. The space race began in 1957 with the Soviet Launch of the Sputnik satellite, followed three months later by the launch of the US satellite Explorer 1.

The civil rights movement continued its march forward. With the landmark Supreme Court case Brown v. Board of Education in 1954, “separate but equal” laws were struck down, paving the way for integration and the major civil rights movement activities of the 1960s. The role of women in business expanded. As the decade moved along, women’s roles in the working world became hotly debated in the public press. In addition, the beginnings of the “equal pay” rallying cry from the women began in this decade.

LIFE INSURANCE DURING THE 1950S

The life insurance industry experienced strong growth during the 1950s, benefiting from the economic boom as much or more than any other industry. In 1951 there were 609 legal reserve life insurance companies. By 1955 there were approximately 800 life insurance firms in the US, and by the end of the decade, there were well over 1,000 life insurance companies.

In 1950, US legal reserve life insurance companies had approximately $235 billion of insurance in force. The new sales in 1950 were estimated at $30.8 billion and included ordinary, industrial and group life insurance. The payments made to beneficiaries totaled $4.25 billion, 63% of which were paid to living beneficiaries. In 1955, new sales reached approximately $47.4 billion, resulting in $373 billion in force. In that year, it is estimated that 80% of US men and 62% of US women held some amount of life insurance. By the close of the decade, the industry had approximately $580 billion in force.

In 1957, the second largest company in the US and the world was Metropolitan Life Insurance Company with $14.8 billion in assets followed by Prudential Life Insurance Company with $13.3 billion in assets. They both followed the biggest company, American Telephone and Telegraph Company with $18.4 billion in assets. Quite literally, life insurance ruled the world.

While sales were growing, mortality was also improving. Advances in the medical field continued throughout the decade, helping insurance companies to price ever-more competitively and to realize greater returns on mortality.The National Service Life Insurance continued to manage an enormous block of business; approximately 6,000,000 policies, representing $36 billion in protection.

With the military action in Korea, the war clause again became a matter of concern for the industry. Competitive action, and legislative action by certain states resulted in many different responses ranging all the way from shutting down sales to members of the armed forces to simply restricting aviation coverage. Early on in the Conflict, a large group of insurance companies came together in an effort to negotiate the pooling of the war risk, but no such deal was ever realized.

Regulation continued to be an issue for the industry. Early in the decade, the salary stabilization legislation was still in effect, not ending until 1953. Tax laws continued to change with two different formulae in the first three years of the decade. Social Security continued to be seen as a threat, especially as benefits were increased and more people qualified for this coverage.

An important advancement in life insurance was the introduction of automation. The potential effects of the ‘electronic machines’ was debated in the newspapers beginning in 1954. In 1955 it was reported that LOMA (Life Office Management Association) had formed an Electronics Committee that worked with a similar committee of the Society of Actuaries. The intent of these groups was to study the impact this ‘potentially revolutionary’ technology could have on the industry.

The industry, continuing the trend that began in the 1940s, was highly concerned with the quality of the Insurance Agent selling their products. A significant amount of energy was expended in developing exams that could determine the likelihood of success of a particular recruit, and robust training programs were made for those agents already in the field.

Competition in the industry grew significantly during the decade. In a 1955 article in Barron’s National Business and Financial Weekly, John C. Perham discussed new policies introduced that year that charged less for higher face amounts, calling them ‘special’ or ‘cut-rate’ policies. Other new policy innovations were introduced including the ‘family policy,’ a policy intended to cover an entire family at a lower rate than the individual rates, the ‘business women’s policy’, intended to offer disability coverage to the working woman, ‘family income plans,’ where the amount of the coverage decreased as the family’s children grow up, and the ‘guaranteed insurability rider’ that insured a client can purchase additional coverage in the future. In 1959, Northwestern Mutual Life introduced lower rates for women, stating:

Northwestern Life Mutual has felt that it is every woman’s right to be considered younger than her age – years younger than a man who has lived the same length of time. Recent mortality statistics now validate this view, and the new rates reflect it! N.M.L. is the largest life firm to recognize lower female mortality rates by reducing gross premiums on female policies, and we are the first company in the United States to give special recognition to present women policy holders thru dividends.

(Investors Guide, Chicago Daily Tribune, 12 Jan 1959)

The Negro companies also continued to grow. Although they were started and initially grew serving only Negro customers (not by choice, but due to segregation), they were now becoming big enough to attract the attention of white customers. The largest companies included North Carolina Mutual, Southern Aid, Atlanta Life, and Supreme Liberty Life Insurance Company. In 1954, North Carolina Mutual hit a major milestone surpassing $200,000,000 in force by the end of the year. This put the company at #136 of all insurance companies in the US based on insurance in force, and #124 based on admitted assets. The company was #1 among the 66 Negro life insurance companies in operation in 1954.

An important study came out in 1950 showing that, despite years of thinking otherwise, race had no bearing on length of life. The insurance industry argued otherwise, stating that the mortality of blacks was 50% higher, and therefore a poor insurance risk. This debate was not settled until much later.

WOMEN IN LIFE INSURANCE DURING THE 1950s

Following the end of the War, the question of women in the workplace was a confusing matter. Many Americans expected women to go back home when the men returned to the workforce. The reality proved to be more complicated. In many cases, the need for workers had expanded to the point where women were necessary to fill all of the positions. And in many cases, women found that either their income was required to feed their children, or that they enjoyed work outside the home, and enjoyed the additional comforts for their families that were now possible with two incomes. This led to the question of what positions the women should and/or were capable of filling and how much the women should be paid, among other things.

The place of women in the workplace was debated in the press, most especially around the end of the decade. Headlines such as “Women Just Are NOT Good Bosses – Says a Man” (Chicago Daily Tribune, 27 Jan 1957), “Can Women Get Along Without Men?” (Los Angeles Times, 13 Oct 1957), and “Women in Business Advised Against Being Feminists” (Daily Boston Globe, 25 May 1958) show the contention that was beginning to surface in society.

Of great interest to the people of the times (based on the number of newspaper articles on the subject) was a dramatic shift in the number of married women, generally over the age of 35, working outside the home. In 1950, married women made up more than half of the female working population. One personnel manager suggested that this was in part due to the fact that the employers could pay married women less than single women (and single women less than men) because they had a husband bringing home his pay. Another shift saw more women working clerical office jobs than any other profession.

And yet, at the beginning of the decade, companies still were less inclined to hire married women, if they could avoid it. Some companies even had specific policies against hiring married women. The personnel director at Metropolitan Life Insurance Co. was quoted as saying, “It’s always been our general policy not to hire women who are married. But if they come to us single and get married later we’ll keep them as long as they want to stay.” The general reason given for these policies was that married women tended to miss more work than others due to their need to care for their children.

By the middle of the decade, opinions had changed. Companies were short on workers, and were willing to try new tactics to attract more. In 1956, Metropolitan Life Insurance Company and Aetna hired mothers for shorter shifts between 9am and 3pm so that the mothers could be home in time for their children to return from school. Prudential Insurance Company offered employees a paid day of vacation for recruiting their friends, and other insurance companies were paying bonuses for recruiting qualified candidates.

The total number of women in the workforce in the US rose to over 18 million in 1950. By 1955, estimates showed 20 million women in the workforce, and the number continued to climb throughout the decade.

In 1949, women doubled the amount of insurance they had purchased in 1940, reaching $39 billion in force, approximately 1/5 of all life insurance in the US. By 1952 it exceeded $45 billion. By 1957, the amount women held in life insurance exceeded $60 billion. Reasons given for this increase include the growing employment of women, their increasing understanding of their need to protect their families, and a desire for retirement income.

In 1954, Northeastern Life Insurance Company of New York introduced a special policy marketed as a special policy exclusively for women. Of particular interest is the statement in the press release that reads “the policy contains the same provisions and benefits as the company’s principle policy for men, a preferred life contract.” Not many companies at the time were advertising “men only” policies, so this is curious indeed.

An article from the Chicago Daily Tribune in 1955 emphasizes the need to treat women differently when selling to them. One agent “urges attempts to create appeals that acknowledge woman’s real importance and indispensability.” He states that “this would involve new advertising techniques based on a truer understanding of woman’s nature.”

A number of women were elected or appointed to important, high-level positions in the life insurance industry. Each one of the women highlighted below was a “first,” and their nominations were well publicized.

Miss Lucinda B. Mackrey served as Secretary and Director of the Provident Home Industrial Mutual Life Insurance Company, and was one of the very few African-American women to hold an officer position in a large life insurance company at this time. Mrs. Mae Street-Kidd held the position of public relations director for Mammoth Life, and Mrs. Bertha Nickerson was a member of the board of directors of Golden State Life Insurance Company.

In 1950, Mrs. Millicent Carey McIntosh was elected the first woman director of the Home Life Insurance Company of New York. The president of the company explained that this appointment was indicative of the fact that women now had an important place in American business, and that a great number of the personnel in life insurance companies are female.

In 1951, the John Hancock Mutual Life Insurance Company elected its first female officer, Sophie Nelson, assistant secretary; Penn Mutual Life Insurance Company appointed its first female officer, Mary Foster Barber as assistant vice president; Connecticut General Life Insurance Company promoted Mrs. Charlotte Cowan as the assistant comptroller and Leila Thompson as head of the legal department.

In 1953, Bernice Sanders became the Vice President and Controller of the Supreme Liberty Life Insurance Company, and also handled all company training. She held a bachelors degree from Wilberforce University and did graduate work in mathematics and physics at Radcliffe College and Ohio State University. Quoting from an article in the Chicago Daily Tribune (10 July 1955), “Today she is mainly concerned with the challenges racial integration has brought both to her company and her race. She feels a new process of education is necessary for preparation for the new era dawning.”

In 1955, Northwestern Mutual Life Insurance Company appointed its first woman to the company’s board of trustees, Miss Catherine B. Cleary, a vice president of the First Wisconsin Trust company and former assistant treasurer of the United States. In the same announcement, the company shared that a woman, Mrs. Marie A. Stumb, placed second among 3,500 agents for sales in April.

In 1956, The Mutual Life Insurance Company of New York elected its first female member of the board of trustees, Mrs. Oveta Culp Hobby. She had served as the first director of the Women’s Army Corps, and the first Secretary of Health, Education and Welfare. At the time of her appointment, she was the president and editor of The Houston Press.

WOMEN AS LIFE INSURANCE AGENTS IN THE 1950s

Women were selling as much as ever. One estimate said that in 1950, there were approximately 5000 women selling life insurance. By 1954, three women (and 1237 men) had reached the life membership of the Million Dollar Round Table, selling over $1 million for three years in a row. Mrs. Grace Chow of Los Angeles was one, selling almost exclusively to the Chinese population in LA.

In 1957, the estimated number of women in the field had risen to 6,000 full time female agents with more than 275 women qualifying for the Quarter Million Dollar Round Table, and 13 women qualifying for the Million Dollar Round Table.

As with the executives in the home office, the success stories out in the field were often celebrated in the press, a testament to the singularity of the events. This decade certainly showcased more women than in decades past, but it was clear that successful woman were still a curiosity.

Miss Helen Ann Pendergast was a life member of the Women’s Quarter Million Dollar Round Table. She was quoted as saying that women did not normally enter the field before 30 because “you have to be a little bit older to tell a man how to provide for his family. But being a woman is no handicap, partly because men are accustomed to looking to women for advice all their lives about many things.”

Lesla M. Sabin, in 1951, was the only female general agent in Chicago. She had been in the business for 15 years at that time, and was the mother of nine children. She was nominated in 1951 for the Woman of Distinction by the Chicago Women Lie Underwriters in recognition of her leadership.

In 1953, Muriel Bixby Clark owned and operated her own insurance business in Los Angeles, and was the first woman named to the board of directors of the Insurance Association of Los Angeles, serving as Vice President. She said of the life insurance business:

You starve for the first two years…Really it is a wonderful profession for a girl. It requires a willingness to know your product and more than ordinary willingness to be of service…If you know more about your business and are willing to work just a little bit harder than your competitors, more power to you!

Another woman echoed these sentiments. Thelma Davenport, the national chairman of the National Committee of Women Life Underwriters, the distaff side, and life member of the Quarter Million Dollar Round Table, said in 1956:

The life insurance field is one of the real opportunities for career girls here and now…Women want to help people. They are interested in the welfare of the family, the protection of the home, the education of children – and life insurance provides for these things.

The Insurance Women of Los Angeles, one of 200 similar groups across the country in the 1950s, had the express purpose of elevating and expanding the role of women in the insurance industry. The president of the organization said, in 1954:

Women are receiving more and more recognition in the insurance field and are constantly finding new worlds to conquer…Although women do not often reach executive positions, many who start at the bottom do attain high supervisory capacities.

The 1950s were clearly a decade of significant growth for the life insurance industry and for the women in the industry, and the female customers of life insurance.

Up next, the 1960s.

Sources:

Anonymous (1955). “Insurance Notes.” Chicago Daily Tribune, Jul 25, pg C7.

Anonymous (1956). “Mutual Life Chooses First Woman Trustee.” New York Times, May 24, pg 44.

Anonymous (1955). “N. Car. Mutual Passes $200 Million Insurance In Force.” Philadelphia Tribune, Mar 26, pg 16.

Anonymous (1955). “The Women’s Corner.” Chicago Daily Tribune, Oct 10, pg. E5.

Anonymous (1959). “The Women’s Corner.” Chicago Daily Tribune, Jan 12, pg C4.

Anonymous (1959). “The Women’s Corner.” Chicago Daily Tribune, Aug 3, pg C6.

Anonymous (1951). “Women Buying Insurance.” New York Times, Jun 21, pg 42.

Anonymous (1951). “Women Make Good.” The Baltimore Sun, Aug 26, pg SO26.

Anonymous (1952). “Woman Rises From Clerk to Sec’y of Life Insurance Co.” Pittsburg Courier, Jan 12, pg 20.

Anthony, Julian D. (1952). “Running a Life Insurance Company is Fun.” Journal of Risk and Insurance, (19),1, 40.

Bachrach, Bradford (1950). “First Woman Director of Home Life Insurance.” New York Times, Dec 19, pg 54.

Barnes, Alerne (1954). “Insurance Group to Hold Annual Parley.” Los Angeles Times, May 23, pg D5.

B.M.W. (1953). “Insurance Woman is Philanthropist.” Los Angeles Times, May 10, pg C2.

Burns, Frances (1954). “She Works Just as Hard on Volunteer Jobs.” Daily Boston Globe, Oct 10, pg 69.

Clarke, M.C. (1950). “Insurance Executives Have Faith in Future.” Pittsburg Courier, Aug 19, pg 6.

Elston, James S. (1951). “Part II – Review of the Year: Life Insurance.” Journal of Risk and Insurance, (18), 1, 112.

Ford, Elizabeth (1956). “She Leads Women in Life Insurance.” The Washington Post and Times Herald, Sep 26, pg 28.

Galpin, Stephen (1950). “Women: They’re Grabbing Off a Greater Share of Jobs In Office and Factory.” Wall Street Journal, May 24, pg 1.

Ives, David O. (1956). “Companies Hire More Women, Part-Timers to Ease Office Pinch.” Wall Street Journal, Nov 28, pg 1.

MacKay, Ruth (1951). “Mother of Nine Trades Her Cookbook for Rate Book.” Chicago Daily Tribune, Nov 2, pg A8.

MacKay, Ruth (1952). “Women Turning More to Work Outside Homes.” Chicago Daily Tribune, Jan 7, pg C8.

Olsen, Lief (1953). “Americans Stock Up on Purse Protection with Record Rapidity.” Wall Street Journal, Sep 1, pg 1.

Perham, John C. (1955). “Premium on Competition.” Barron’s National Business and Financial Weekly, Jan 10, pg 3.

Stein, Sonia (1950). “Insurance Gives Distaff Side a Big Welcome.” The Washington Post, Jul 7, pg C4.

Wallace, S. Rains Jr. (1954). “Research in Life Insurance.” Journal of Risk and Insurance, 21(1), 22.

Williams, Carroll E. (1957). “More Women Attracted to Insurance.” The Baltimore Sun, Apr 3, pg 25.

Women in Insurance – A History – WWII

wwii

World War II broke out in Europe in 1939. During the first few years of the war, the US remained, or attempted to remain, neutral. The economy was significantly improved from the days of the depression, and even as Americans watched the horrors unfolding across the ocean, life was returning to normal.

That all changed, of course, on December 7th, 1941, when the Japanese bombed Pearl Harbor, and the US declared war on Japan the very next day. Suddenly jobs shifted from civilian to war efforts. Taxes were raised and precious war-time commodities were rationed. Men from all walks of life were pulled into service, and the landscaped of the American workplace was changed forever.

LIFE INSURANCE IN THE EARLY 1940S

Life insurance faced several hurdles in the 1940s. One particular impediment was the renewed fight over the New Deal, and whether life insurance was a federal or state concern. In a particularly impassioned article from 1940, written by Frank Gannett and entitled “Now Is the Time to Act: Save the Nation from Chaos,” he writes:

Life insurance has built in the short span of one century the greatest social security system that any people have ever known. Life insurance is the very embodiment of democratic ideals of individual responsibility….The total amount now in force in the United States is approximately 114 billion dollars. No wonder the Washington bureaucrats, having exhausted their genius for inventing new taxes, are itching to get their fingers on this 30-billion-dollar-prize…

Another difficulty was, quite obviously, the war. With the outbreak of the war, life insurance companies acted quickly to add the war exclusion rider to all sales, thereby protecting themselves from excessive claims due to war-time casualties. They were, of course, still liable for all policies purchased prior to the implementation of the war exclusion.

Because of the war, the industry suffered a shortage in salesmen and home-office employees. One particular specialty recruited to the war effort were the actuaries, needed for their mathematical skills. There was also a shortage of medical doctors. This put additional pressure on new life insurance sales. In response, companies began to extend their non-medical limits, allowing more life insurance sales to be placed without an examination.

To help those men and women who enlisted in the armed forces, the government stepped up, and by 1943 was the largest life insurance “company” in the country.

It is important to note that the Jim Crow laws were still in effect during this decade, and the life insurance industry was no exception. Much like the “white” companies, the negro companies weathered the Depression well, and came into the 1940s as strong as ever. In fact, these insurance companies were on the front lines of racial issues, as Dr. P.P. Cruezot, President of the National Negro Insurance Association, shared on a radio program the “manner in which forty-odd Negro life insurance companies are pioneering in the education, training, and higher standard of living for several million young men and women, and galvanizing the confidence between companies, the policyholders and the public.”

In 1940, the admitted assets of US life insurance companies totaled $30.8 billion. This was up from $15.9 billion in 1928. One interesting statistic: in 1940, throughout the US, there were 9 life insurance claims over $1 million, 2 of which were over S$2 million and 2 of which were over $3 million.

By 1942, sales had slumped due to war-time tax increases, decreases in the insurance workforce, and the gasoline rationing that made insurance sales much more difficult. Sales rebounded in 1943, and in 1944 sales reached a new peak of $148.4 billion in force. At the same time, claims and other benefit payments were also rising due to wartime losses, but the industry remained as stable as ever.

WOMEN IN INSURANCE IN THE EARLY 1940S

In general, the 1940s were a boon to women in the workplace. With men deployed oversees, women were sought to fill the vacancies men left behind. Even married women were being recruited to positions previously unimaginable for them. A Chicago Tribune article from 1942 reported a 300% increase in demand for female workers.

Women were even moving into top leadership positions where needed. An article from the Washington Post in 1942 discussed this, and also shared the downside of the situation – the fact that the men would return, and the women would be a problem when they did. One expert in employee relations was quoted as saying:

If this war lasts another year or two, women will move in large numbers into important executive and managerial positions. Then there’ll be the puzzler of what to do about it when the war is over and men come back.

The Metropolitan Life Insurance Company handled the situation in this way:

“In the last war Metropolitan moved women into executive positions. No successful method was found for demoting or advancing them when it was over. And, in the cases of some who still hold those jobs today, the situation is neither very satisfactory for the women nor the management. This time Metropolitan is not attempting to fill war-created vacancies job-for-job.”

Some saw the problem as self-correcting; women, they felt, would naturally leave the workforce to marry and become housewives just as the men were returning from war. Two surveys, both conducted in 1944, reflected the differing opinions. One survey of 50,000 employed women indicated that only 6% of these women intended to keep their current positions after the end of the war, and another 19% who would keep their jobs only if it did not replace returning service men. Another survey, conducted by the women’s advisory committee of the war manpower commission, reported that 71% of women intended to stay in the workplace and only 17% planned to return home.

By 1946, demand for female workers had dropped dramatically, and had shifted back to traditional jobs for women including teaching, secretarial work, and clerical positions.

In stark contrast to the previous decade where women were nearly invisible, women came back into focus in the life insurance industry as customers, sales representatives, and home-office workers. The industry now had a “whole new market” with so many women now entering the workforce.

Women purchased over 900,000 ordinary life policies in 1940, accounting for 20% of all sales. Over 50% of these purchases were made by business women, and 1/3 were housewives. Most frequently, the policies were purchased by women under the age of 30. By 1942, women accounted for 30% of total life insurance sales, and in 1943 sales to women were up to 35% of total sales. By 1944, women were buying 83% more life insurance than they did in 1942. Although the percent did increase over time, in general the amount of insurance purchased by women was roughly 50% of the face amount purchased by men.

One major step forward took place in 1947 when New York Life Insurance Company announced the election of their first female director. Mildred McAfee Horton also served as the president of Wellesley College. Upon her election, George L. Harrison, president of New York Life, stated “With a large number of women holding insurance or named as beneficiaries in policies, it is only natural that they should be represented on the directorate. The selection of Mrs. Horton indicates that my associates and I agree on the importance of having a woman on the board.”

WOMEN AS LIFE INSURANCE AGENTS

An article published in 1940, entitled “A Portfolio of Insurance Women,” profiled 13 different women who were forging their careers in the insurance industry. Quite obviously, these women had been engaged in insurance prior to 1940, and yet it is exceedingly difficult to find any mention of them before the decade turned over. These women were all agents (one managed the women’s division in a home office), working for companies such as Equitable in New York, Boston’s John Hancock agency, Fidelity Mutual, Penn Mutual, and Massachusetts Mutual. The article begins this way:

‘Insurance selling – what a job!’ So says Beatrice Jones, CLU (standing for Chartered Life Underwriter), New York insurance woman, supervisor of the women’s division of the Wilson Agency of the Equitable Life Assurance Society, chairman of the women’s division of the National Associate of Life Underwriters, and educational vice president of the New York Life Underwriters Association….’Selling life insurance,’ she says, ‘has put me to the test as no other work I ever did began to do, and yet I wouldn’t exchange it for anything.’

Insurance women

Another article from November of 1940 put the number of female life insurance agents in that year at 4,000, and citing a survey conducted by the Women’s Committee of the National Association of Life Underwriters, stated that these women had written policies on 956,000 people, providing $2.4 billion of life insurance protection for their families. The study showed that most women selling life insurance at that time were in their late 40s and sold 43% of their business to men.

In 1944, an article appeared in The Washington Post titled “Woman Agent in Insurance Here to Stay.” The author states:

Among the important changes that have taken place [during the years of the war] are: …The realization, on the part of life insurance agency executives, of the place of the woman agent in our business. Although there have been successful woman agents in life insurance for many years, and some have attained high honors, it took the war and the consequent manpower shortage to cause companies to recruit and train women in large numbers. There is nothing temporary about “women in life insurance” because they are being trained on a career basis.

There was still a strong bias against women’s financial competency and ability to conduct business during this time. Most men assumed that after the war women would return to their kitchens and living rooms. One particular lawyer, speaking to the American Society of Chartered Life Underwriters in 1944 highly recommended the practice of putting life insurance and other assets into family trusts in order to “protect [women] from their own weaknesses.”

In another talk, given to the women employees of Metropolitan Life Insurance Company in 1946, the speaker claimed that the great tragedy of the war was the breakup of the home, and stated that “the key to peace was to be found in ‘three great roles’ for women, in the home, in the community and in seeking equity rather than equality.”

An interesting study was published in 1940 (Seder) looking at the differences between the vocational interest of professional women, and whether they differed from men. One of the test samples was of insurance salesmen and women, where she found that there was no indication of any difference between the two genders. In other words, contrary to thought of the day, women and men, when engaged in the same occupation, were likely to have similar interests. This was an important step forward in the women’s movement.

So, while women in general took a huge step forward during the war, then a small step back after the war, women in insurance continued to solidify their place in the workforce. The business still viewed them as “other,” but continued to recognize their importance to the future success of the industry.
Sources:
Anonymous (1947). “Head of Women’s College Elected to Directorate of New York Life.” New York Times, Aug 21, 35.
Anonymous (1946). “Job Prospects for Graduates Termed Good.” Chicago Daily Tribune, Jun 24, 28.
Anonymous (1941). “Life Insurance Payments in Chicago Rise.” Chicago Daily Tribune, May 16, 29.
Anonymous (1942). “New Graduates Get Many More Offers of Jobs: Pay Is Much Higher; Women in Demand.” Chicago Daily Tribune, Oct 17, 25.
Anonymous (1941). “Women Big Buyers of Life Insurance.” The Washington Post, Sept 13, 13.
Anonymous (1940). “Women Gaining as Underwriters.” The Washington Post, Nov 6, 16.
Associated Press (1940). “Life Insurance Assets Top 30 Billion Dollars.” Chicago Daily Tribune, Dec 7, 23.
Gannett, Frank (1940). “Now is the Time to Act: Save the Nation from Chaos.” Delivered to the Connecticut Council of Republican Women, at the Bond Hotel, Harford, Conn., April 30.
MacKay, Ruth (1944). “White Collar Girl.” Chicago Daily Tribune, Mar 34, 17.
McCullough, Trudie (1942). “Women Now Hold Top Jobs In Business.” The Washington Post, Jul 12, R7.
Mitchell, Robert B. (1944). Review of Life Insurance in 1943. Journal of Risk and Insurance, 11(1), 61.
O’Donnell, Charles W. (1944). “Woman Agent in Insurance Here to Stay.” The Washington Post, Jan 2, R4.
Whitney, L. Baynard (1940). “Calvin’s Digest.” The Plaindealer (Kansas City, KS), 5-31, 7.

Women in Life Insurance: A History Part 5 (The Depression of the 1930s)

3

The 1930s were a difficult time for Americans. After the market crash in 1929, the Great Depression set in and continued throughout the decade. Americans and others throughout the world experienced skyrocketing unemployment, drastic reduction in trade, a significant fall in prices, taxes, and profits, and a widespread failure of businesses across industries. The day-to-day lives of Americans changed dramatically.

By all accounts, the women’s movement, which had gained so much momentum in the first three decades of the century, took a rather significant step backwards during this decade. In general, women who worked outside of the home were seen as ‘stealing’ those jobs from men who needed to support their families. Norman Cousins was quoted as saying:

“Simply fire the women, who shouldn’t be working anyway, and hire the men. Presto! No unemployment. No relief rolls. No depression.”

The employment situation became so dire that nepotism legislation was passed allowing only one spouse to hold a government position. This, in effect, kept wives out of this part of the workforce. In addition, 26 states passed laws prohibiting the employment of married women. Even working women supported this way of thinking, encouraging married women to stay home. One woman who worked for Metropolitan Life Insurance Company, while explaining that married women should not be working, stated:

“Marriage is a business which needs good hard work and much attention if it is to be a success…All girls are old fashioned even now, in their home-loving instincts, and they generally prove it after marriage.”

The first-hand accounts from this time describe a complex web of families trying desperately to make ends meet. Sometimes families could not do this on just one salary. Other accounts show men so distraught over their continued unemployment that their wives were forced to find work to feed the family. Because of the significant prejudice against women holding “men’s” jobs, these women were forced into lower-paying domestic careers such as teaching, nursing, sewing, and cleaning. The further harm done to women was in the fact that even in these “women’s” jobs, women were paid less than men for the same work. This was done to further discourage women from taking these jobs away from men.

As a result, the role of women as homemakers and mothers was emphasized in all aspects of life in the 1930s. Even so, there were prominent women in politics and society doing what they could to support women. First Lady Eleanor Roosevelt was the most prominent, advocating for benefits for women within the New Deal. She helped to create the women’s division within the Federal Emergency Relief Administration, and helped to nominate a woman to run it. She also held the White House Conference on the Emergency Needs of Women in 1933, bringing to light the needs of working women during the Depression.

Women, as in the previous decade, continued to control much of the wealth in the US. According to an article written in 1935, women were the beneficiaries of over 80% of all life insurance policies, controlled 65% of all bank accounts, and held 40% of all real estate. In addition, they paid over $5 trillion in taxes each year.

INSURANCE COMPANIES DURING THE GREAT DEPRESSION

The life insurance industry weathered the Great Depression better than most other industries, largely due to the requirement of holding more conservative investments and large reserves.

Requests for surrenders and loans were certainly much greater than in decades past, and there were companies that failed. Early in the decade, newspapers were filled with stories of consolidations, failures, scandals, and most unfortunately, some suicides of insurance executives. In addition, fraternals and secret societies died out due largely to men being unable to make their dues payments. Social Security took the place of these organizations.

A report from 1933 showed life insurance in force falling from $109 trillion in force in 1931 to $103 trillion in force in 1932, and from 68,000,000 lives insured in 1931 to 65,000,000 lives insured in 1932. In 1931 one US life insurance company paid over a million dollars more in suicide benefits than in 1926.

The second half of the decade saw the life insurance market begin to improve. The headline in the New York Times in January of 1936 stated “$2,500,000,000 GAIN IN LIFE INSURANCE, Rise, Largest Since 1930, Makes Total in Force $101,000,000,000, Says Ecker. SALES VOLUME UP 1.5%.” The headline in January of 1937 reads, “RECORD YEAR SEEN FOR LIFE INSURANCE, Lincoln says Public’s Faith in Stability of Institution Is Basis of Prediction.” And finally, the headline from January, 1939, “NEW RECORD SET BY LIFE INSURANCE, High Marks in the Average Amount Carried and in Total Coverage Attained in Year.”

Things were looking so good for the industry, William Frederick Biegelow, the Editor of Good Housekeeping, penned a letter in a 1939 edition in high praise of life insurance. He titled his letter “Looking Forward to Tomorrow,” and in it he gives lengthy descriptions of the current statistics around life insurance and then states:

“In other words, the people of this country believe in life insurance. They believe in it because, except in isolated instances, it has not failed them. It is the greatest cooperative enterprise the world has ever known….What is our interest in life insurance? Just the belief that it is one of the things that no man should overlook when he is planning his future…Just the hope that this form of protection, of peace of mind, will soon be the possession of every family in America.”

WOMEN IN INSURANCE IN THE 1930s

Given the economic environment and the societal shift toward women working in the home, it is not unexpected that we find little information on women working in the insurance business during this decade. Where we do read about them, the emphasis is very clearly on clerical work.

Despite the lack of information on women in insurance during this decade, there are references to Women’s Departments buried in the literature. In an article from 1932 on advertising, there is reference to a set of conferences sponsored by the women’s department of the Wisconsin National Bank of Milwaukee. Another article from 1937 announced a radio broadcast “sponsored by a group of insurance women,” that discussed “insurance security for women.” The host of the broadcast was quoted as saying:

“There is no need for any woman to face insecure old age or sickness which she cannot afford. I am profoundly impressed by the stability of insurance companies during the depression, when most other large business institutions were rocked to their very foundations and all too many crumpled and crashed.”

An insurance ad from 1932 reflects the perception of the lack of sophistication of women and finances. The Guardian Trust Company Ad reads:

“It hasn’t been easy for you to build your insurance estate…You’ve shouldered the burden gladly to assure your loved ones peace and comfort if anything should happen to you. Someone must take up the burden when you are gone. Will it be carried by the inexperienced, grief-bowed shoulders of your wife or by the broad, sturdy, experienced shoulders of this great bank?”

Another Trust Company issued a booklet in 1932 entitled “Can Women Learn to Manage Money?” The purpose of the brochure was to educate women on how to best manage their households and avoid the financial mistakes of their parents and overcome their own previous mistakes.

An article on positions in life insurance from 1931 seem to offer hope to women seeking employment:

“The college graduates of 1931 are going to find that the business depression, which we all hope is passing, has seriously interfered with the usual demand for those who are willing to start on a modest salary. Many, therefore, will be glad to learn about openings in the business for which the chief requirements are a good character and the willingness to work. The life insurance companies of America offer college graduates an opportunity to win their way to the front solely on their own ability.”

Unfortunately, later in the article the author refers to “college men” only, and discusses life insurance as necessary “in the greatest emergencies of life – in old age, or when a family has lost its husband and father…” thereby negating any importance women would have in the industry.

If it seems as though I have pieced this all together, I have. As I mentioned above, it was extremely difficult to find any primary sources that spoke of women in the insurance industry during this decade. It seems that the golden era of women’s suffrage in the 1920s was completely snuffed out by the Great Depression. By the end of the decade, the country was emerging from the Depression, but unfortunately, it seems the women’s movement took an enormous step backwards.

Next, we will look at the 1940s and insurance during World War II.

Sources:
Anonymous (1932). “How Banks are Advertising.” Bankers’ Magazine, 124(3), 361.

Anonymous (1937). “Hails Insurance Security for Women Late in Life.” New York Times, May 18, 39.

Anonymous (1931). “‘Mother’ to 13,000 Will retire Jan 1.” New York Times, Dec. 17th, 14.

Bigelow, William Frederick (1939). “Looking Toward Tomorrow,” Good Housekeeping, 8 (5), 4.

Dublin, Louis I., Bunzel, Bessie (1933). “To Be or Not to Be, A Study of Suicide.” The Living Age, 345(4406), 276.

Hirschfeld, Gerhard (1935). “The Facts behind Economics.” America Magazine, June 8, 206.

Lindsay, L. Seton (1931). “Life Insurance.” The North American Review, 231(6), 562.

Moran, Mickey (1988). “1930s America – Feminist Void?” Loyola University of New Orleans Department of History Outstanding Paper for the 1988-1989 academic year.

Patch, B.W. (1933). “Life Insurance in the Depression.” Editorial Research Reports, Vol. 1.

Woolner, David B. (2009). “Feminomics: Breaking New Ground – Women and the New Deal.” Roosevelt Institute, 12/15, http://rooseveltinstitute.org/feminomics-breaking-new-ground-women-and-the-new-deal/. Accessed 6/24/2018.

Women in Insurance, a History, Part 4 The 1920s

votes for women

One of the most significant steps forward in the battle for women’s equality took place on August 20th, 1920, when the 19th amendment to the US Constitution allowing women the right to vote was certified into law by the US Secretary of State. This had been a long time in coming. Women had been fighting for this right for nearly one hundred years through marches, protests, campaigns, and political maneuvering.

Women were making progress in other areas as well. In 1929, women controlled approximately 41% of the individual wealth in the United States. The report by Lawrence Stern and Company included impressive statistics:

  • Women [were] the beneficiaries of 80% of the $95,000,000,000 of life insurance in force in the US
  • Women [paid] taxes on more than $3.25 billion of individual income annually
  • Women millionaires, as indicated by individual income tax returns, [were] as plentiful as men
  • Women to the number of more than 8,500,000 [were] gainfully employed

Women were entering the workforce in greater numbers than ever before. That said, women were not generally accepted as equals in the workplace. Blatant sexism was common. In a Forum article from April/May 1920, an argument was put forth that women were, as a rule, incapable of success in business. The author stated “There are more reasons than would fill these pages why women fail in business.” He claimed that women who achieved any level of success did so through pure luck.

One particular statement gave me pause because it may, in fact, be true. Regarding successful women, the author stated:

“And we read about these women over and over again, simply because they are the rare exceptions which prove the rule that women, as a whole, are notoriously unsuccessful in business.”

While I disagree wholeheartedly with the premise of the statement, I worry at the idea that we still read of these singular women today. This, though, is a thought for another post.

In some places knowledge of the nature of the inequality of women was emerging. An interesting 1919 article from the Lancet reads:

“No one has ever denied that a woman is handicapped on account of her potential motherhood, but this handicap is, as a rule, far greater than is necessary… Only in very rare and exceptional cases is it possible to compare with any degree of fairness the ability, both physical and mental, of men and women. Their upbringing has been different and their training and development have been forced along different lines.”

The essay explains that the difference in the responsibilities placed on a young woman at home necessarily puts her behind her male counterparts in terms of education and thereby impedes her abilities to achieve high levels of success throughout life.

WOMEN IN INSURANCE

Women were entering the insurance industry home offices in ever increasing numbers. The vast majority of these women were employed to handle stenography, bookkeeping, and other routine, clerical jobs. Very few women advanced beyond this level. An article from 1924 stated “Men, as a rule, fill the posts requiring extended training, because the majority of women employees take positions only for a limited period between school days and marriage.” According to one report, only 25 officers in the insurance industry were women in 1927.

Although women were insuring their lives at a greater rate than ever before there were still objections to the purchase of life insurance. One woman, describing her own situation, stated that when her husband proposed to buy insurance on his life, her reaction was similar to that of her friends:

“I don’t want my husband to spend money on insurance for me; I think it would be wrong to insure his life; besides, he is in perfect health.”

Not all companies were willing to write business on female lives. Those who did most often included some sort of physical hazard waiver against pregnancy, protecting the companies from a death directly or indirectly related to pregnancy. Some companies included this as a clause covering the first policy year or years. Others outright excluded any deaths related to pregnancy.

One important advancement however, established by the Supreme Court, determined that pregnancy, in and of itself, was not a violation of a warranty of good health. In other words, a woman who is not asked about pregnancy during an application for life insurance, and signs a statement of good health, but then dies shortly thereafter due to complications related to pregnancy cannot be denied benefits.

WOMEN AS LIFE INSURANCE AGENTS

A report from the National Association of Life Underwriters estimated that in 1927 there were approximately 202,000 men and women licensed to sell life insurance in the US, and that 85% of the business was written by 15,000 men. The life insurance business was clearly a man’s business, as exemplified in this quote from a female agent:

“There is a great dovetailing of business. Men give concessions to other men.”

Another woman is quoted as saying:

“Undoubtedly this correlation of business and exchange of patronage does exist. Then, too, men prefer to deal with men when they buy insurance.”

There were certain groups of women who found success in this industry during this decade when they might not have found it elsewhere. Those were women who wished or needed to work part-time, women who were older, and women who were not college educated. Most insurance companies at this time would not employ women under 30, and while college education was desired, it certainly was not required.

Retention of women agents was a concern. Many of the older women recruited into the industry were not able to handle the early lean years almost universal in the industry. Most of the time these women were entering the workforce because of an immediate and acute need for funds that could not be provided in the first few years of an insurance sales career.

Some women were successful. An article from 1927 highlighted several successful women in the life insurance industry. Mrs. Florence Shaal and E. Marie Little are profiled as the only women to head all-female agencies (The Equitable). Mrs. Shaal is credited as the first woman to be elected to office in the National Association of Life Underwriters, and was named the manager of the first ever women’s department in the country.

Emma Ditzler (Connecticut Mutual Life), who wrote policies almost exclusively on women, was “believed to have established a world’s record for her sex in insurance by writing at least one application a week for life insurance for 150 successive weeks.” Sarah Crannell Wells (New York Life) wrote enough insurance to qualify for the Two Hundred Thousand Club, and is credited as one of the most successful insurance women in New York. She is quoted as saying, “I believe women have a special field in family work in insurance…It’s hard work. It means new shoes, or at least new soles every month.”

Another female agent warranted a full page story in a 1924 edition of National Business Woman. Elizabeth Kenney, widowed at a young age, entered the work force as a school teacher in Iowa. She joined the local Business and Professional Women’s Club and became one of the most active members. After attending a national convention of this organization one summer, she was inspired to become an insurance salesperson, working for the Mutual Life Insurance Company in New York. She experienced immediate success, doubling her annual salary in her first six months on the job. Her manager is quoted as saying:

“With practically no experience, she wrote more applications during the third quarter than any other representative in this Agency, comprised of 45 counties, besides having many other duties to engage her attention.”

She was quickly thereafter promoted to district manager over four counties. Her friends said of her:

“Much of her success as a businesswoman rests on the fact that she is so human herself and has such a deep understanding of human nature….[she] gives of herself freely and impartially whenever needed, and brings inspiration to all with whom she comes in contact.”

As in decades past, the life insurance industry has recognized the desire for attracting women both as insurance agents and as policy holders. The industry has not, though, figured out the best way to do this.

Next up, the 1930s. As always, keep it positive and smile!
Sources:
Anonymous (1928). “Insuring the Future.” National business woman, 8(7), 340-341, 380-381.
Anonymous (1929). “Women Control 41 Per Cent of Nation’s Wealth.” Bankers’ Magazine, 118, 5.
Anonymous (1919). “Women in Industry.” The Lancet, July 26, 167-169.
Anonymous (1927). “Women in Insurance.” National business woman, 12(6), 17, 45.
Bruere, Henry (1924). “Number One Madison Avenue.” The Independent, Dec. 27, 113, 3891.
“Excepted Risks in the Law of Life Insurance: Part II.” (1925). The Central Law Journal, 98(20), 350.
Norman, Henry (1920). “The Feminine Failure in Business.” Forum, April/May, 455.
Ravlin, Bernice (1924). “Elizabeth Kenney Insurance Underwriter.” National business woman, 2(8), 11.
Wallace, Eugenia (1927). “Business, Altruism and Insurance.” National business woman, 12(6), 14-16.

Women in Life Insurance, A History (A difficult chapter)

juneteenthIn my series of posts on the history of women in life insurance, I have worked our way up to the1920s. I realize now, however, I have skipped over an important topic that deserves its own space. It is a topic that is extremely uncomfortable and downright despicable for the industry and for me. I share this information purely as education into some of the dark early days of this industry. The subject matter does not pertain solely to women in the industry and yet I feel compelled to include it. The topic at hand: slave insurance.

I came across two excellent papers written on this subject. The first is entitled “Securing Human Property; Slavery, Life Insurance, and Industrialization in the Upper South,” written by Sharon Ann Murphy, a professor at Providence College. The paper was published in 2005 in the Journal of the Early Republic. The second paper is titled “Actuarial Issues in Insurance on Slaves in the United States South,” written by Cheryl Rhan-Hsin Chen and Gary Simon, and published in the Journal of African American History in 2004. Much of the information I will share can be found in those two papers.


In the 1830s, the Baltimore Life Insurance Company was one of the most successful life insurance companies operating in the United States South. The company’s intent was to write “white lives,” exactly as their competitor companies were doing in the North. The demand in the South, however, was not the same, and in looking for ways to diversify earning, they landed on the insurance of “negro lives.” This insurance, however, only partially mirrored the life insurance offered on “white lives.”

Slave insurance might actually be better described as “property insurance”. Chen and Simon make these distinctions: “(1) the beneficiary upon the death of the slave was never the slave’s family; (2) the face amount of the policy was directly linked to the market value of the slave; (3) the term of the policy was short,” with most policies on record for a year or less, with the maximum being seven years.

Many times, slave owners would purchase insurance on slaves they rented out for dangerous work, such as railroad building or working on the steamboats. Or else they purchased insurance on skilled artisans and house workers. Still other times they purchased the insurance as a means to fund the manumission, or freeing, of the slave. Records indicate this was often done as a means to keep families together when a slave was otherwise to be sold away to the Lower South.

There were difficulties with slave insurance. First, there was the concern that an owner might find more value in the insurance than in the life of the slave. For this reason, companies would limit the amount of insurance to 2/3 of the market value of the slave, and would write policies for short periods of time, allowing them to examine the slave more often should there be a request for a renewal. Records show that in the early days, policies were never written above $800 for males, $500 for females, and the amounts did not go up until the 1850’s when competition was stronger for these policies and the value of slaves had grown.

Closely related to this was the concern that a slave’s owner or overseer would mistreat a slave, thereby diminishing the market value of the slave. This, as above, could result in a situation where once again the slave is worth more dead than alive. In many instances, the insurance company would be underwriting the slave owner as much as the slave him/herself in order to ensure the slave would be treated well.

The third difficulty was in the pricing of the insurance. There were virtually no records on the mortality rates of slaves, so the insurance companies had to simply guess when developing their premium tables. In most instances, they simply doubled the rates charged for white lives of the same age. They would also include risk charges for slaves who were engaged in dangerous employment, and a ‘climate premium’ for slaves traveling south of the border of Virginia or Kentucky.

While the Baltimore Life Insurance Company was the first on the scene selling this type of insurance, many competitors joined the space in the late 1840s and early 1850s. Reflecting the ‘property insurance’ nature of slave insurance, many Fire Insurance companies began to sell these policies. Also, life insurance companies from the North thought they saw an opportunity here as well. According to Murphy, among the companies selling this insurance were New York Life, North Carolina Mutual Life, Aetna Life of Hartford, Hartford Life, Richmond Fire Associate of Virginia, Asheville Mutual Insurance Company of North Carolina, and Georgia Insurance and Trust Company of Baltimore, among others.

We do not have full statistics on how many policies were written, nor how many claims were paid. Murphy reports that the Richmond Fire Association wrote over 1,700 slave policies in Virginia, and that by the late 1850s over 3/4 of the business written by North Carolina Mutual was written on slaves. In addition, of the first 1,000 policies written by New York Life (then known as Nautilus Insurance Company), 339 of them were written on slaves.

Emancipation, signed into law by Abraham Lincoln on this date in 1862 rendered all of these policies void, and many of the southern insurance companies that relied on these sales were forced out of business.

In 2002, the state of California passed a law that required companies to disclose any profits they made through participation in the slave trade. Only three companies in existence today came forward, all of them expressing deep regret for their participation in this market. New York Life was able to produce evidence of 610 policies, Aetna of Hartford produced 19 policies, and AIG produced 173 policies. The analysis Chen and Simon did on these three sets of policies, given the extremely limited information they had, seemed to indicate that these companies did not profit from this business, but in fact likely lost money on these policies.

This was indeed a horrible chapter in the history of life insurance. I felt the need to include it in my history of women in life insurance because of the obvious fact that some of the slaves were women. But also because I feel it is important to recognize all of our history as an industry and as a nation. It helps us understand more about where we are today, and if we use the information right, it will  help us to avoid ever making the same mistakes again.

Thanks for reading, happy Juneteenth, keep it positive, and smile!

 

 

 

 

Women in Life Insurance, a History: Part 3 (1890-1913)

1910-Fashion

The turn of the century was an exciting time for women in the United States. As mentioned in an earlier post, women were gaining more rights and independence all the time. They were entering the workforce in greater numbers than ever before, further fueled by start of World War I. Women could be found in offices across the country, entering fields as diverse as one can imagine.

All of this independence and freedom meant that women were now controlling their own money, or at the very least, taking a significant interest in their financial futures. Life insurance companies were not unaware of this change, and stepped in to take advantage of this new market.

There are many newspaper articles from this time that speak directly to the idea of women and life insurance. Not surprisingly, there were significant barriers to this market, but companies and life insurance agents did their best to address these and to adjust for new information. For example, in an article published in the periodical The Independent in 1894, there is a discussion of the fact that the rates for women were higher than for men (based on rate tables that were 25 years old), meaning that the insurance companies expected women to die sooner than men. This was likely due to the hazards in that day of child birth. This idea, however, was changing. From that same article:

“All authorities seem agreed that a female, if thoroughly examined, is fully as good, if not a better risk than a male.” (The Independent, 1894)

Women also were believed to hold a “lingering prejudice against the insurance of their own husband’s life in their individual favor” (The Independent, 1908). Some writers at the time held that women believed that insuring their husband’s lives and listing themselves (or their children) as beneficiary was akin to wishing their husbands dead.

On the flip side, most articles encouraged women to take advantage of life insurance:

“Women nowadays enter into business pursuits, contract bills and write notes just as men do….there is scarcely a better way for the wage-earning woman to provide for her future than by means of life insurance” (Massachusetts Ploughman, 1900).

“If [life insurance] is a good thing for men and if it is approved and patronized by the wisest and best business men all over the country there is no possible reason why women should not enjoy its benefits if they so elect” (The Independent, 1908).

Even wealthy women are adopting life insurance as the most desirable investment for their money, and one hears more and more of women of means who take out policies simply as investments” (Ladies Home Journal, 1900).

The business or professional woman, in sheer self-defense, ought not to neglect the matter of life insurance. The money it signifies will be equally welcome whether she is married or single when the endowment matures” (The Independent, 1910).

WOMEN AS LIFE INSURANCE AGENTS

It is around this time that we start to see more articles on women as life insurance agents. As more women moved into the workforce, it seemed to be a natural fit for them. The hours were flexible, the start-up capital minimal, and the nature of the sale was congruent with women’s desire to care and protect their friends and families.

Even back in 1894 there was a prediction of women’s entrance into this field:”…women are soon to bear an important part in life insurance as policy holders, solicitors and medical examiners.” An article from 1903 leads off in the opening paragraph with the statement “Life Insurance offers a most attractive field to a man or woman who is fitted for the business,” (The Independent, 1903, emphasis added), and later states:

“Many women entering into this field have found it exceedingly profitable, but women agents find that diplomacy is quite as essential, in so far as they are concerned, as it is with their brothers.”

And in my favorite article from this time period, a Mrs. M.T. Rodgers of Dallas, Texas, was interviewed regarding her career as a life insurance agent, which she happened into by chance. Her husband had passed away, leaving her with four children to raise on her own. After working in an office for a small weekly wage for seven years, and realizing her pay would never be great, she enlisted in business school. In the interview, she was asked if she felt it was harder for women to succeed in life insurance sales than men, and she states:

“No, I don’t think it is. A woman is as well adapted to solicit life insurance as a man, and the beauty of it is that in life insurance she gets the same pay as a man. This is not true of any other business in which women work. I always wonder why more women don’t go into it. I think it is one of the noblest professions, and that life insurance goes right along with a woman’s religion. She comes in contact with the best people; in fact, she can select those with whom she wants to deal. I have never met with insult or rebuff in the thirteen years I have been selling life insurance. I have always been treated courteously. That can’t be said of many businesses in which women engage for far less than they would receive in life insurance” (The Independent, 1913).

It is difficult to track down any numbers regarding how many women were selling life insurance around this time. The closest hint I found indicated that there were “thousands of women” selling at least some life insurance in 1913. What is clear, though, was that the women’s market was already an attractive target for the life insurance industry as far back as the 1890s.

As always, keep it positive and happy Thursday!

Sources:

“Insurance for Women” (1894). The Independent, 46, 238. July 19. Accessed 6/13/18.

“Should Women Insure Their Lives?” (1900). The Ladies’ Home Journal, 17(3), 16. Accessed 6/13/18.

“Women and Life Insurance” (1900). Massachusetts Ploughman, 59(28), 4. Accessed 6/13/18. 

“Diplomacy as an Equipment for the Life Insurance Agent” (1903). The Independent, 55, 2845. June 11. Accessed 6/13/18.

“Insurance for Women” (1908). The Independent, 64, 310. Accessed 6/13/18.

“How Women May Save” (1910). The Independent, 69, 3235. December 1. Accessed 6/13/18.