Little Known Insurance History Facts

While reading The South During Reconstruction – 1865-1877 (E Merton Coulter) I came across a bit of information about the insurance industry I found to be of great interest.

​One such fact is that Southerners were prohibited from paying their insurance premiums due to the “laws” of war and thereby lost not only their coverage, but all monies they had paid into the policies. This meant millions of dollars were forfeited to Northern insurance companies.

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Not only that, many Northern companies refused to reinstate policies for people who supported the Confederacy. If they did (reinstate), it was only after the policyholder paid all past due premiums with interest and submitted to a physical exam at their own expense!

On occasion, a company might offer to “settle” with policyholders but that too, was a mere fraction of the insured’s investment; some as little as $75 or $140 for a policy in which the owner had paid in thousands of $$ in premiums.

Many Confederate officers became active in the insurance industry after the Civil War and developed companies in hopes of keeping the money in the South. Others, such as Davis, Hampton and Gordon, became president or vice-president of companies like the Carolina Life Insurance Company and the Southern Life Insurance Company.

If you believe the cost of war is high, this article proved that the cost of peace in the aftermath, was also extremely high since hundreds of millions of dollars of insurance and bank investments evaporated during the war and Reconstruction.

Another tidbit I found interesting was “Insurance for the Rich and Poor,” a practice where the insurance company divided its policyholders into groups of 1000 and upon the death of an insured, the remaining group members paid the beneficiary $1.00.

Talk about sharing the risk!

If you’re an American History buff, check out this book. I’m sure you’ll find it as fascinating as I did.

Until next time take care and remember…. reading is knowledge and knowledge is power.
Tommy Curtis & Staff