Holocaust-Era

Insurance Claims

Prof. Gerald D. Feldman

PROFESSOR OF HISTORY, UNIVERSITY OF CALIFORNIA, BERKELEY AND

FELLOW, AMERICAN ACADEMY IN BERLIN

UNITED STATES

Nazi Confiscation of Insurance Policy Assets

Plenary Session on Holocaust-Era Insurance Claims

This description of the confiscation of the insurance policies of

Jews and other designated enemies of the National Socialist State is

based on my research for a book that will appear in English and German

on the Allianz AG, the German Insurance Industry, and the National

Socialist regime. I wish to make it clear that I have been asked to

undertake this study, as an independent scholar with no obligation to

Allianz beyond producing a professional work of history. The

confiscation of Jewish insurance policies and related measures constitute

only a part of my study of the relations between the company and the

regime, and I am in no way personally or professionally engaged in the

search for unclaimed and unpaid policies. I study insurance policies,

whether compensated or uncompensated, primarily for information about

the relations between the company and its Jewish customers. This said,

the processes by which the Nazis despoiled Jews of their insurance assets

are of great importance to my work, and I shall do my best to clarify

them. I shall concentrate on life insurance policies with a face value of

between 10,000 and 100,000 Reichsmark, that is, the larger type of

policy that constituted a substantial investment and asset. I should note

that policies above 30,000 RM were extremely rare. Finally, I will say a

word about postwar compensation programs. Let me emphasize that

these are necessarily very summary remarks, and I will expand on some

of the points made here and deal with some of the other issues in the

breakout sessions.

I think it important to point out at the very beginning that life

insurance was a popular form of saving and investment for middle class
580 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

and upper middle class German Jews who made their careers as

merchants, lawyers, and doctors. Most of the persons whose policies I

have examined fell within these professional categories. Typical life

insurance policies examined by me ran for about twenty years and had a

face value between ten thousand and thirty thousand Reichsmark at

maturity. They constituted a form of capital investment, having a

growing repurchase value that usually included dividends paid by the

companies. Because of the experience of hyperinflation in 1922-1923,

many of policies I have seen which were taken out in the mid-1920s

were denominated in gold, fine gold, or supposedly secure foreign

currencies, above all, the dollar and Swiss franc. Most of these policies

were voluntarily converted to Reichsmark in the early 1930s, while

conversion became mandatory in August 1938.

In thinking about Nazi confiscation of insurance, I find it useful

to distinguish between indirect and direct confiscation. Prior to the

outbreak of war in 1939, the primary means by which Jews were

deprived of their insurance, that is, the expectations they entertained

when they took out insurance and the proceeds available to them from

their insurance, were indirect. On the one hand, the increasing economic

pressure on the Jews caused by loss of means of livelihood through

various impositions and restrictions on their economic activity made it

impossible for many of them to pay their premiums and also compelled

them to monetize their insurance assets. Also, insofar as they decided to

emigrate, they needed all the money they could get to pay the costs of

emigration and to pay the Reich Flight Tax (Reichsfluchtsteuer), a

measure introduced in 1931, that is, before the Nazis came to power, to

prevent flight of capital. The tax had been deliberately revised in 1934 to

enable the regime to exploit emigrating Jews by taxing away a quarter of

all their assets. The situation became qualitatively more severe after the

Pogrom of November 9/10, 1938 because of the billion RM “Atonement

) on assets imposed on the Jews and the systematic

measures then taken to drive Jews from German economic life. As a

result of the increased radicalization of National Socialist expropriation

measures, panic took hold among Jewish policyholders, and there was a

flood of repurchases. The evidence I have seen shows that the Allianz

paid promptly and correctly to their Jewish policyholders, and this would

seem to be true of the other major companies. Such payment was in any

case required of all companies, no matter how large the number of

Jewish policyholders they had, by the Reich Supervisory Office for

Insurance (Reichsaufsichtsamt für Versicherung).
HOLOCAUST-ERA INSURANCE CLAIMS 581

The fact that the insurance companies paid out the repurchase

price, however, does not mean that the Jews had full and free access to

their money. Jews who planned to emigrate normally had to state their

intention to the authorities and, in certain instances, transform their bank

accounts into blocked emigrant accounts (Auswanderersperrkonten) from

which they could only withdraw funds with the permission of the tax

authorities upon certification that they had paid the Flight Tax and the

Asset Tax and any other taxes that may have been due. In some cases

the revenue offices simply ordered the blocking of the accounts of Jews

who had not fully paid their taxes or who were liable to further taxation.

Insurance proceeds were paid into such accounts at the instructions of the

insured, who in effect had no other choice but to issue such instructions.

In other cases, the insured simply instructed the insurance company to

pay insurance proceeds directly to the financial authorities. Finally, even

if Jews could gain access to their funds, the exchange controls made it

impossible for them to take more than a very limited sum of money

outside Germany so that many emigrating Jews retained money in the

blocked emigrant account, sometimes for the use of relatives remaining

in Germany. In any case, by 1939, the processes of indirect confiscation

as I have described them had thus become barely distinguishable from

those of direct confiscation.

Nevertheless, the direct confiscation of Jewish insurance assets

had different foundations from the indirect confiscation in connection

with tax and other currency and financial obligations discussed until

now. The basis for such confiscation already existed in the Law for the

Seizure of Assets of Enemies of the People and the State (Gesetz über

die Einziehung volks- und staatsfeindlichen Vermögens) of July 14, 1933

which, along with an accompanying law on termination of the citizenship

of such persons (Gesetz über Wiederruf von Einbürgerungen und

Aberkennung der deutschen Staatsangehörigkeit), allowed the

government to confiscate the assets of Communists and other designated

enemies of the regime. Some use of this legislation was made to

confiscate Jewish assets throughout the 1930s, particularly of Jews who

had emigrated and those who had aroused the ire of the regime through

their activities abroad. The names of those deprived of citizenship were

normally published in the official government journal (Reichsanzeiger),

and the Gestapo then proceeded to inform the relevant bank and

insurance organizations that the assets of these persons were confiscated

and were to be turned over to the financial authorities. In the case of

insurance, this meant that the repurchase value was to be calculated and

the sum transferred to the designated Revenue Office.
582 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

The reporting and confiscation of Jewish assets was turned into a

requirement by the 11th Decree of the Reich Citizenship Law of

November 25, 1941 (11. Verordnung zum Reichsbürgergesetz), which

mandated the confiscation of all Jewish assets for Jews regularly residing

abroad. By this time, of course, most of those who had not emigrated

had been deported to concentration camps in the East, which constituted

“residing abroad,” and were now systematically deprived of their

citizenship and property. Indeed, the decree was directly connected with

the effort to deport all Jews remaining in the Reich who had not already

been deported that had begun earlier in the month. Under Paragraph 7 of

the decree, organizations and persons who had control of such assets –

insurance companies, for example – were required to report them within

a very short period of time. It cannot be said that the insurance

companies showed any enthusiasm for this decree, not because of

discernible moral or ethical considerations, but because they had neither

the personnel nor the resources to identify the Jewish policies in their

possession, many of which were free of premiums and thus of constant

bookkeeping requirements and were not easily identifiable as Jewish.

The records I have seen suggest that the initiative usually came from the

Gestapo and other authorities, which turned up with the names of the

Jews, announced the deprivation of their citizenship, and then used the

information collected on their assets to contact the insurance companies

and order payment of the repurchase value to the Regional Revenue

Office in which the Jews had resided. I think it important to recognize

that insurance at this point was among the lesser assets subject to seizure

since the moneys in question had already been surrendered in one form

or another by the general despoliation of the Jews and their forced

emigration in 1933-1939.

In the case of German Jews, therefore, postwar restitution for

insurance was primarily concerned with compensation for prematurely

terminated policies and the proceeds of policies subsequently seized

from insurers and blocked bank accounts. The payments were made by

the government under the postwar restitution and compensation

agreements. Under the compensation laws, the insurance companies,

including foreign companies operating in Germany, were responsible for

checking their files for the policies of former Jewish customers and

calculating the amounts to be paid by the government.

Swiss and insurance companies of other countries allowed to do

business in Germany were subject to the confiscatory regulations and

decrees I have described, as, after 1938-1939, were the Italian companies

operating in Austria and then in the Sudetenland and in so-called
HOLOCAUST-ERA INSURANCE CLAIMS 583

Protectorate of Bohemia and Moravia. Swiss companies argued during

and after the war that the German government, not they, was liable for

the Jewish insurance monies they had paid out to the National Socialist

regime. In the case of law suits against the Swiss both during and after

the war, U.S. courts ruled against the Jewish claimants in favor of the

Swiss insurance companies, although back in Switzerland, Swiss courts

ruled in favor of Jewish claimants in cases where their policies

specifically stated that payment could be made either in Germany or in

Switzerland. Italian companies have denied payment obligation on the

claims of customers in Poland and the former Czechoslovakia by of the

socialization of their assets in those countries after the war. The

Austrians issued an Insurance Reconstruction Law in September 1955

requiring that claims for all insurance contracts issued prior to January 1,

1946 would be paid on the basis of a reduction of the claim by 60%. The

Dutch apparently were able to transfer stolen insurance assets from their

collection point in the bank of Lippmann, Rosenthal & Co., which had

been aryanized by the Nazis and used for such purposes, to the relevant

insurance companies and mandated settlements with their Jewish

customers. Manifestly, we are thus confronted with very diverse

practices and solutions with respect to compensation of Jewish insurance

assets, which run the gamut from the absence of any compensation in the

former Communist countries to varieties of compensation in Germany,

Austria, and the Netherlands.

Mr. Glenn Pomeroy

NORTH DAKOTA COMMISSIONER OF INSURANCE

PRESIDENT, NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS

UNITED STATES

Plenary Session on Holocaust-Era Insurance Claims

Thank you, Ambassador Olson.

It is a great honor to be here, to work with you, and be a part of

this historic undertaking.

My colleague, New York Superintendent of Insurance, Neil

Levin and I hope to briefly outline steps U.S. Insurance Regulators have

taken throughout this past year with respect to insurance issues. In

particular, we have had a very productive summer and fall as we have

worked hard in search of a solution to the issue of unpaid Holocaust era

insurance claims.

First of all, I need to briefly describe U.S. Regulatory

environment for insurance.

In the U.S., this industry is not regulated at the national level,

here in Washington, D.C., but is regulated by the states. Each state has a

primary regulator for the insurance sold there. That person is responsible

for licensing the companies and agents that sell in that state and oversee

the products that are sold there. Each state is assisted in their individual

effort by the collective effort of the National Association of Insurance

Commissioners, the NAIC. The NAIC is a membership organization that

brings all states together for various voluntary efforts such as developing

model laws or facilitating joint enforcement activity.

Last year, with the publicity surrounding the restitution of

Holocaust-era assets from Swiss banks, the issue of unpaid insurance

policies began to draw national attention as well. A growing body of

public evidence suggested that several major insurance companies had

sold policies to people of Jewish faith in the 1920s and 30s, but they had

never paid a claim on those policies to the rightful parties...the insured.

In September of 1997, the NAIC created a Working Group to

investigate these issues and identify the appropriate role for the NAIC

and the states in the search for justice – helping Holocaust survivors and

their heirs resolve claims stemming from policies sold during the

Holocaust era.
586 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

The Working Group began by holding a series of hearings

around the country. I attended our first hearing held here in Washington,

D.C., last fall. My colleagues and I listened first hand to the personal

accounts of several Holocaust survivors whose parents had been sold

either a life policy, property policy, or dowry policy. The purchasers of

these policies, generally the parents of the persons who testified, perished

in the concentration camps at the hands of the Nazis. They left behind

children who, though they managed to somehow survive the Holocaust,

had never managed all these years later to be adequately compensated

under the insurance policy purchased by their parents.

The hearing was a powerful experience for all of us. We sat with

Holocaust survivors and looked into their eyes as they fought through

their emotions to tell us their stories. A woman, for example, who

recalled the day long ago when a door to door salesman came by to sell

her father and insurance policy. How thrilled he was that notwithstanding

the discriminatory practices then targeted at the Jewish community, here

was one company that wanted his business. She recalled for us the

circumstances surrounding the murder of her parents, her own survival,

and her unsuccessful efforts over the last several years to receive just

compensation under the policy.

And so, after conducting several hearings through the country,

this past Spring, the NAIC decide to establish a committee of nine states

and work toward the establishment of an International Commission to

resolve unpaid claims to Holocaust survivors and their heirs.

Given the importance of this issue to all the states, as President

of the NAIC, I was asked to head up this effort and I asked

Superintendent Levin to serve as Vice Chair. As he and I and other

colleagues from around the country, many of whom are also here today,

began our work this spring, for me personally, there were two

particularly inspiring moments that gave direction to the passion that all

of us felt for this cause.

The first came in early May when this new committee of State

Insurance Commissioners met in New York and met with Rabbi Israel

Singer. Rabbi Singer, in his own powerful and articulate way,

encouraged us to be guided by achieving an outcome that was both swift

and fair. Swift because for Holocaust survivors still living we don’t have

time to debate or litigate this matter for the next ten years. Fair because

as we heard last night and this morning this is not about money this is

about justice. This is about doing what we can to obtain justice – now!!

Work with the companies, Rabbi Singer implored, and the

honorable men and women who now run them. Let cooperation and
HOLOCAUST-ERA INSURANCE CLAIMS 587

collaboration be our cornerstone and not confrontation because if

confrontation is the chosen path, no one will win and everyone will lose.

Rabbi Singer’s words meant a great deal to our committee and we have

tried to honor them with our actions.

For me, the second defining moment came in June, when I had

the opportunity at the planning session for this conference, to visit

personally with Ben Mead who heads the American Gathering of

Holocaust Survivors and who, with his granddaughter, led the

Remembrance Service last evening. Ben told me that it was this wish that

when people today work on these issues, that they always remember that

we are not talking about academic issues, or not just talking about

abstract numbers, but real people, who lived and worked and dreamed –

and who purchased insurance policies as part of their dreams for the

future – a future that would never come.

Ben told me his own story. As Rabbi Singer mentioned, Ben’s

family didn’t have much money, sometimes they even had to forgo a trip

to the grocery store. But, they would always make their weekly insurance

payments. Ben told me how he, as a little boy, was the only child in the

neighborhood who didn’t have a bicycle, his family couldn’t afford it,

and yet his father made sure the insurance payment was made – every

week.

Now, here in the U.S., I’m from North Dakota. As I began this

involvement, I was aware that perhaps only one survivor resided in my

state and, sadly, she passed away this summer. Obviously, this issue is

not one that impacts directly the people in my state – but that doesn’t

matter – not anymore. Not when I think about my friend Ben Mead, and

think about when he was a young boy with parents who loved him but

were taken from him – forever.

I think about my own young son, and I realize that I am

personally connected to this issue now in a way that is powerful and

profound – even a little difficult to explain.

And so, we worked throughout the summer to create an

International Commission. Through a “Memorandum of Understanding,”

which has now been signed by six insurance companies and over 40

states, an agreement was reached in August and the Commission was

formed.

This Commission is made up of representatives from the

insurance regulators, both U.S. and Europe, the companies, the survivor

organizations, and the State of Israel. The goal is to work with

collaboration rather than confrontation.
588 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

Superintendent Levin will explain in more detail about the

Commission, its process, and how it will approach its task to achieve the

moral accounting that must take place now, before it is too late.

Yes, this is difficult. And, yes this is complicated. We are talking

about horrible activity that occurred over 50 years ago. In so many cases,

policyholders were murdered and all their records destroyed. Many

companies have since either been taken over by the Nazis or nationalized

by Eastern European governments in the years following World War II.

But, these difficulties are tiny and insignificant compared to the

tremendous responsibility we now bear – the tremendous opportunity we

now have – to achieve, under our watch, a measure of justice by working

with others who share our responsibility and our opportunity.

Through the work of the International Commission, we have

created the process to get the job done. And now, the Commission must

to its work.

Thank you.
Mr. Neil D. Levin

SUPERINTENDENT, NEW YORK STATE INSURANCE DEPARTMENT AND

VICE CHAIR, NAIC INTERNATIONAL HOLOCAUST COMMISSION

TASK FORCE

UNITED STATES

Plenary Session on Holocaust-Era Insurance Claims

Thank you, Commissioner Pomeroy.

It is a great honor to be here and to be part of this historic

conference.

As you all recall this conference began with comments by

Ambassador Eizenstat and Mr. Wiesel who spoke so eloquently about

the moral and ethical imperatives for addressing issues which have been

lingering for over 50 years. This was followed by Secretary of State

Albright’s personal and moving plea to give people back their history. I

would like to take a few moments to speak about how the International

Commission will strive to do this.

The theme of this conference is voluntary action based on a

moral foundation. This also is the theme of the International

Commission. The Commission is composed of thirteen members, all of

whom have joined voluntarily: Three representatives from the United

States commissioners, three representatives from the international Jewish

and survivor organizations and six representatives from the European

insurance companies and regulators. There are also three observer spots

for the survivor and Jewish groups, an observer spot for the State

Department and an observer spot for the European Economic

Commission.

The International Commission has already begun meeting and

has initiated its work. As part of its mandate, the International

Commission will oversee an audit process and is currently developing an

audit program. However, we are going to learn from the successes and

problems of the Volcker Committee. The Commission is committed to a

“top-down” review and will not expend millions of dollars combing

through every shred of paper in Europe. Further, the Commission is

committed to using the work of auditors the companies have already

hired if that work meets an appropriate standard in order to avoid

unnecessary costs. At all times we will be attempting to maximize
590 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

recovery for Holocaust victims and minimize expenditures for auditors

and lawyers.

Further, the Commission is committed to a claims driven process

and is currently setting up a claims resolution process with a 1-800

number to receive and process claims. Our goal is for the complete

process to be user friendly. The claims process will operate with relaxed

standards of proof that will acknowledge the passage of time and the

practical difficulties of the survivors, their beneficiaries and heirs in

locating relevant documents.

The Commission will work to resolve all of the claims within

two years and payments to survivors and their heirs will be made

throughout the Commission’s two-year investigation.

The Commission has also created a humanitarian fund and a

fund to deal with nationalized claims and claims against companies that

are no longer in existence. We are proud to be able to say that we

already have an upfront contribution of $90 million from the insurance

companies towards those funds. The Commission plans to move quickly

to determine how these amounts will be allocated to Holocaust victims.

Further, the insurance companies have committed to pay the expenses of

the Commission so that no money is taken away from survivors.

In addition, Mr. Eagleburger and the U.S. State Department will

lead an effort to encourage other insurance companies and foreign

governments to participate in the Commission. Today we are making

an appeal to the 44 countries represented here to participate in this

Commission. I would like to personally commend the six companies that

are participating in the International Commission yet unfortunately they

only represent 25% of the market during that time period. Not one

company has come forward that is not doing business in the United

States. I must ask the question why? There is a moral and ethical

obligation to aid in this effort to restore and rewrite history for the

survivors.

We should end the 20th Century differently than it began -- with

a global community with a strong conscience -- a community that is

unafraid to remember and is committed to moral and ethical renewal.

We must commit to open our archives to take steps to make them

accessible and to commit to preserve these archives. Just recently I was

able to learn about my own personal history through access to archives in

Belarus and the Ukraine. This is the least we can do for all of the

survivors.

As we were reminded by Elie Weisel, Secretary of State Albright

and Under Secretary of State Eizenstat, our efforts here today are about a
HOLOCAUST-ERA INSURANCE CLAIMS 591

lot more than money. They are about a gesture of restitution and

contrition, rewriting history and letting the victims witness before they

die, the support of the governments around the world who sat by silently

for far too long.

Thank you, and I look forward to working with all of you in this

effort.

Mr. Herbert Hansmeyer

MEMBER OF THE BOARD OF MANAGEMENT

ALLIANZ AG

Plenary Session on Holocaust-Era Insurance Claims

Mr. Bindenagel, Secretary Eagleburger, Judge Mikva,

distinguished Ladies and Gentlemen,

I would like to extend my sincere thanks to you for the

opportunity to participate in the Washington Conference on

Holocaust-Era Assets on behalf of Allianz AG. The topic of insurance

policies held by the victims of the Holocaust is very challenging and not

at all comparable to the dormant accounts in Swiss banks - not only

because many countries - each with its own history and political and

legal aspects - are involved, but also because insurance itself is a rather

complex area of business.

I would be pleased if I could contribute some information to

Conference participants for their discussion of Holocaust-era insurance

claims.

Allow me to begin by emphasizing that Allianz AG is committed

to achieving clarity on this issue. Furthermore, it is, and has always been,

our policy to pay all legitimate claims of our policyholders. This is

naturally also the case for unsettled claims of our company from

Holocaust survivors and their families.

In this respect, we are determined that justice is done. It is for

this reason that Allianz AG is a participant in the International

Commission under the chairmanship of Secretary Eagleburger. At this

juncture, I would like to express my personal and my company's thanks

to him for taking on this difficult task. Under his guidance this

commission will certainly bring us all a step closer to our common

pursuit of a just resolution. In this respect, I would also like to express

my personal appreciation to the U.S. State Department and the U.S.

Holocaust Memorial Museum for organizing this important international

forum. This, too, will certainly help us all achieve clarity on the factual

circumstances before, during and in the aftermath of the Second World

War.
594 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

That many insurance claims might have remained unpaid after

the Second World War came, quite frankly, as a surprise to Allianz AG.

Even more surprising to us was the accusation - made in no uncertain

terms in the New York lawsuit that for more than 50 years we had not

paid claims to victims of Nazi persecution. This, ladies and gentlemen, is

quite simply untrue. It is vitally important that those of us seeking to

address these issues in a constructive manner realize this.

The reason that the lawsuit came as a surprise to us - and let me

emphasize this clearly - was that we did know that, as far as Germany is

concerned, most insurance claims had been previously paid fairly and

correctly, the majority of them before the war. In addition, the majority

of cases were included in post-war compensation programs and treaties

among the nations involved in the war. It was our understanding that

these programs - initiated after World War II by the Allied governments

and continued to this day by the Federal Republic of Germany had, in

fact, settled all claims. The restitution laws were exceedingly

comprehensive and did include claims on insurance policies. In short, we

had to assume that the combined efforts of the Allied governments and

the Federal Republic - with the assistance of the German insurance sector

- had made it highly unlikely that claims remained unsettled.

However, when the lawsuit was filed, it became clear that there

were unanswered questions around already settled policies but even more

about nationalized policies, particularly in Eastern Europe. As many of

the participants here today know, Allianz sought from the very beginning

to be open for a constructive dialogue. Above all, we stated quite clearly

our commitment to treat this with the highest level of integrity. We see

this as our responsibility to all policyholders past and present.

Many of you are aware of our efforts in this area. In April 1997,

we established 24-hour helpline call centers in North America, Europe

and Israel to enable potential claimants to contact us directly with

inquiries in the most unbureaucratic manner possible. We asked Arthur

Andersen to conduct an independent audit of relevant file inventories in

Germany in order to see whether policies had, contrary to our

knowledge, remained unsettled. And we invited Professor Feldman,

renowned expert of history at the University of California at Berkeley, to

research our company's history independently and publish his findings.

We further sought to come to a dialogue with the US insurance

commissioners and the organizations that have represented Holocaust

survivors for decades, seeking to find together a constructive means of

addressing the concerns of all involved. The result of these talks was the
HOLOCAUST-ERA INSURANCE CLAIMS 595

establishment in August of the International Commission, chaired by

Secretary Eagleburger.

We are committed to creating a very sound international process

for settling potentially open insurance claims. Ladies and gentlemen, I

am personally convinced that we are together- on the right path toward a

swift and just resolution of these issues.

Nonetheless, we have observed that discussions remain partially

hindered by lingering problems of perception on the issues involved.

This is, in some respect, understandable. As I said, the technical side of

insurance is difficult to understand, and has been made even more

complex by the passage of more than 50 years since the events under

consideration took place. Additionally, these issues involve many

countries across Europe West and East all with their diverse legal and

historical aspects.

Especially for Eastern Europe, it is not easy to get to the hard

facts of the fate of policies because the insurance companies and their

branches were nationalized after the war. Still, we must make this effort.

Because of Allianz AG's position as the largest insurer in

Germany both today and in the early decades of this century our focus

has naturally been primarily on Germany. The independent audits I have

already mentioned were conducted initially on the file inventories of

Allianz Lebensversicherungs-AG, our German life insurance subsidiary.

They were then extended to inventories held by Vereinte Leben, a

German life insurance company acquired by Allianz AG in 1996.

The auditors faced a daunting task; under consideration were

more than one point four million individual paper files on policies issued

between 1920 and 1945. No separate file inventories for people

persecuted by Germany's Nazi regime existed, and the files have not in

any way been computerized.

Identification of victims of the Holocaust was particularly

difficult. Methods for identification using direct and circumstantial

evidence contained in the files had first to be developed. Finally, Arthur

Andersen provided us with a clear evaluation of the status of files, giving

us an assessment on what happened to those insurance policies and how

our companies have dealt with them.

The audit results showed that, of the files examined, the vast

majority of policies were, in fact, previously paid out at the request and

into the accounts of individual policyholders. Some 70 percent of the

files audited involved cases in which the policy had been canceled

prematurely and been cashed in. Again, almost all were cancelled by the
596 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

policyholder, while cancellations on Nazi Government order were rather

rare.

Ladies and gentlemen, in considering these facts from the view

of an insurance company which of course we must do if we truly want

clarity on insurance issues, we should not lose sight of other important

aspects as well.

In the years leading up to World War II, Jewish people in

Germany came under increasing pressure from the Nazi regime. That

regime first sought to exclude Jews from the economic, social and

political life of Germany, then sought to plunder their property, and

ultimately perpetrated one of the most heinous crimes against humanity

ever recorded - the Holocaust.

Thus, when people sought to cash in their life insurance policies,

they may have done so in a desperate effort to alleviate increasing

financial burdens from unjust levies and taxes, or to facilitate emigration.

They did so in order to escape no uncertain peril to their lives. This is a

fact that cannot and should not be left out.

It is for this reason that the postwar German government

provided compensation not only for the value of policies confiscated by

the Nazi regime in the late 1930s and through 1945, but also for

instances in which people suffered a financial loss on policies cashed in

early. Our research has shown that around 70 percent of the Jewish files

of our companies were later made part of the German government's

restitution and compensation programs.

And let us be quite clear on this, neither the insurance customers

themselves nor the insurers benefited in any way when people cashed in

and thus canceled their insurance policies. But it was and still is the

responsibility of an insurer to pay the cash value on a policy at

cancellation if requested. It may be interesting to note that recently

conducted audits of the German Insurance Department have shown that,

in such cases, our company not only paid, but paid quickly, in some

instances hand-delivering insurance payments to peoples homes. Thus

the Nazi government's efforts to directly seize Jewish assets under

expropriation laws were quite frequently unsuccessful because the

policies were previously paid out or, if they were still in force, carried

loans and prepayments, leaving sometimes only very little, if anything at

all, for the Nazi regime to confiscate.

The question remains, though: Despite earlier payments and

comprehensive compensation programs, is it still possible that some

policies remained unsettled? The answer is yes, but only in the small

number of cases where the beneficiary or heir could not be found by the
HOLOCAUST-ERA INSURANCE CLAIMS 597

companies in the turmoil after the war or did not claim under a policy in

the compensation proceedings.

Did the companies keep the money, as was the case with the

dormant accounts? The answer is no they did not. After the war all

German life insurance companies were technically bankrupt and kept

alive through government subsidies the so-called equalization funds -

which exactly matched their liabilities. The German Insurance

Department conducted audits for a period of 18 years on these subsidies.

If the liability did not materialize, then the subsidy had to be paid back to

the government. Therefore the companies could not enrich themselves

with funds due under unsettled policies. In other words, there are no

dormant assets from unclaimed policies.

Despite this fact, it is our firm belief that policies that remained

truly unsettled should be paid regardless of statutes of limitations and

bureaucratic red tape. This has always been our policy, and it remains

our policy as part of our voluntary participation in the International

Commission.

We still have a great deal of work to do in achieving clarity on

all these issues. This is particularly true in terms of efforts to address

claim payments that were hindered by the chaos in which Europe found

itself during and after the War waves of emigration, the rebuilding of

entire countries and, especially, the nationalization of the private

insurance industry in a number of countries in Eastern Europe.

Determining how to address these issues will take some time. However,

as a further sign of our commitment to assisting Holocaust survivors, the

International Commission has created funds that will be available to

support needy survivors whose claims may be complicated by such

factors.

Ladies and gentlemen, I remain personally convinced that we

can best achieve our common goal of justice and clarity through

continued dialogue between companies, regulators, claimants and, of

course, governments. Again I would like to express my appreciation for

this conferences efforts and offer Allianz AG's assurances that we share

your goals and will continue to support all constructive efforts to address

these issues.

Thank you.

Prof. Gerald D. Feldman

PROFESSOR OF HISTORY, UNIVERSITY OF CALIFORNIA, BERKELEY AND

FELLOW, AMERICAN ACADEMY IN BERLIN

UNITED STATES

Confiscation of Insurance Assets:

Special Issues

Break-out Session on Holocaust-Era Insurance: Historical Overview,

Nazi Confiscation of Insurance Policy Assets

In my presentation to the Plenary Session, I sought to outline the

basic manner in which German-Jewish assets were confiscated. I

distinguished between indirect and direct confiscation. The former was

the consequence of the economic deprivation experienced by Jews

through loss of livelihood, the financial needs arising from decisions to

emigrate, and financial impositions upon Jews. Thus, many of the

proceeds received from the repurchase of insurance policies ended up in

blocked accounts or at various Finance Ministry revenue offices either,

in the first case, as a guarantee that they would pay their taxes or, in the

second, in actual payment of those taxes. Direct confiscation took place

under decrees allowing the State to deprive Jews who had emigrated or

who had been deported in the East of their citizenship and confiscate

their assets. It was systematized under the 11th Decree of the Reich

Citizenship Law which mandated that insurance companies, banks and

other institutions holding Jewish assets actually report them to the

financial authorities so that they could be confiscated and threatened

penalties for non-compliance.

What I want to do now is to flesh out some of these points,

addressing in particular some of the more technical issues involved and

the behavior of the insurance companies in these processes. To begin

with, I would like to make the point that Jews were valued customers

until the regime turned them into poor customers and bad risks. In 1935,
600 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

for example, Allianz sent around a circular to its branches and daughter

companies asking that it be alerted to the names of persons who were

emigrating, to Switzerland, Palestine, or elsewhere, so that the

companies connected with Allianz in those countries could try to keep

these customers. Such a circular would have been inconceivable two

years later, but it is revealing of the effort to sustain a measure of normal

business practice in an increasingly abnormal situation. Similarly, the

correspondence in the policies I have seen demonstrate a desire to

maintain as much of the worth of the policies as possible under the

circumstances. Many Jewish customers moved very slowly in giving up

their insurance. Finding themselves unable to pay premiums, they often

turned their policies into paid-up policies, which maintained at least the

present worth of the policies. Thus, in the case of a twenty-year policy

converted in its seventh year, the value would be about thirty percent of

what it would have been had it come to term. Conversion, however,

also kept the way open for a return to the old policy and full value if

premium payments were resumed. Some Jewish policyholders were very

uncertain as to what to do and, as far as I can tell from the

correspondence I have seen, they received objective and straightforward

advice with respect to borrowing on their policies and the details of

buying them back if that seemed necessary to the customer.

Clearly it is very much to the interest of any insurer to have its

customers hold on to their policies until they come to term since the

profit made on prematurely terminated policies was either negligible or

non-existent. In some cases there was even a loss. German companies,

unlike their American counterparts, did not impose surrender charges.

The cash surrender value of a twenty-year policy after seven years was

slightly below twenty percent. Obviously it was much more to the

interest of the customer not to take the disproportionate loss on present

and expected value entailed in buying a policy back. Insurance

companies that tried to hold on to their Jewish customers, therefore, were

doing so at the very least because it was in their interest. By 1937-1939,

however, this was becoming increasingly pointless. The introduction of

the Four-Year rearmament program at the end of 1936 made Field

Marshall Hermann Göring, who was its head, particularly anxious to

mobilize Jewish assets, while radical elements in the National Socialist

Party put increasing pressure on Jews as well. Jews could no longer

afford to pay premiums and were increasingly inclined to emigrate.

There was a veritable flood of cash-ins beginning in mid-1937, and a

particularly dramatic development following the November Pogrom.

The statistical findings of Allianz tend to confirm the impressionistic
HOLOCAUST-ERA INSURANCE CLAIMS 601

findings of my reading of the policies. Cancellations shortened the

average life of policies by about half, that is, from 20 to 10 years, thereby

diminishing the average cash value of Jewish policies to about 38% of

anticipated full value. In the end, cancellations far outweighed

conversion to paid-up policies. Of the Jewish policies sampled, 69%

were cancelled, while only 17% were converted. There is good

evidence that the shift from indirect to direct expropriation took place in

the latter part of 1939 and early 1940 before it was legally imposed in

late 1941. Most Jews holding insurance, therefore, cashed in their

policies by force of circumstances prior to 1940.

The flood of repurchases in 1937-1939 obviously was a cash

drain on the insurers, and given the way Jews were treated in Germany,

one naturally raises the question as to whether insurers tried to deny

Jewish customers immediate access to their money. I have found no

such evidence with respect to Allianz. There was at least one case, the

Isar Insurance Company, which tried to gain government permission to

convert Jewish policies into premium free policies rather than pay out the

repurchase value. Isar was peculiar in that it had a particularly large

number of Jewish policyholders acquired when it took over the German

block of the business of the Austrian Phoenix company, which had gone

bankrupt in 1936. Isar, however, was denied permission to withhold

payments for repurchase by the Reich Supervisory Office for insurance

and paid out two million marks to Jewish policyholders in 1938-1939.

Leaving aside legal niceties, this was of course quite logical quite once

one reflects on National Socialist intentions. Robbing the Jews of their

insurance assets required their monetization, whether by the Jews

themselves or, as in the case of direct confiscation, by the government.

The regime had nothing to gain by leaving such assets in the hands of the

insurance companies.

Let me now expand somewhat on one of the most confusing of

all the issues connected with the insurance question both with regard to

the policies and with regard to compensation question, namely,

currencies and their worth. This problem is especially difficult for

Americans, who have experienced neither a hyperinflation nor the

introduction of a new currency in this century. The Germans have

undergone this experience twice, first in 1922-1923, and then in 1945-

1948. In the first case, the new Reichsmark was denominated at a ratio

of 4.2 trillion paper marks to one dollar or a trillion paper marks to one

Reichsmark. In the second case, the now old Reichsmark was

denominated at ten RM to one DM in the currency reform of 1948. I

want to concentrate here on the interwar currency issues and their
602 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

implications for insurance and will talk about the postwar currency

reform with respect to the compensation issue in the breakout session

devoted to that problem.

Given the fate of the German mark, it is understandable that after

1923 many Germans did not want to take out insurance companies

denominated in Reichsmark but rather wanted policies denominated in

real values, gold mark values. These took various forms. Some policies

were denominated in fine gold, this being measured as 1/2790 kilograms

fine gold equaling one gold mark or, at a minimum, one Reichsmark,

thereby insuring the customer receipt of at least the Reichsmark

equivalent in fine gold. Policies denominated in gold marks were

presumed to be on a dollar basis, that is 4.2 gold marks to the dollar,

thereby allegedly insuring customer whatever the real value might be in

Reichsmark. Other policies were denominated in dollars or Swiss franc.

Some of them even took out their policies with Swiss or other foreign

companies operating in Germany for good measure. What they did not

anticipate, however, was the currency instability of the Great Depression,

especially after September 1931, when England went off the gold

standard. The Germans did not go off the gold standard in theory but

they effectively did so in practice by introducing exchange controls

during the banking crisis of July 1931. With the end of currency

convertibility, it was very much to the German advantage to have

insurance assets denominated in RM, and a good case could be made that

this was also to the advantage of insurance policyholders after the United

States devalued the dollar by 41% in January 1934 and the Swiss

devalued their currency by 35% in 1936. Companies like Allianz offered

their customers the opportunity to convert their dollar and gold

denominated policies at the old rate of 4.2 RM to the dollar rather than at

2.5 marks to the RM, which became the new exchange rate. Not

surprisingly, most customers took advantage of this offer before

conversion to a Reichsmark basis became compulsory in August 26,

1938. It is important to bear in mind that this was not a policy aimed

specifically against Jews. All German insurance policy holders were

subject to these conversions. The real purpose was for the government to

get more hard currency for the Four Year Plan, and insurers were

compelled to convert the hard currency they had used to cover their gold

mark obligations into Reichsmark and then to invest these Reichsmark in

Reich bonds.

The damage done to Jews in connection with these currency

issues was a product of the exchange control restrictions first introduced

in July 1931, that is before the Nazis came to power, and then
HOLOCAUST-ERA INSURANCE CLAIMS 603

progressively made more severe after 1933 so that emigrating Jews could

not take more than a very limited amount of their money out of the

country. The Reichsmarks Jews had left after paying their various taxes

and for the costs of their emigration had to be converted at a very

unfavorable rate at the Gold Discount Bank, so that Jews could usually

take no more than a pittance of their cash assets out of the country. The

alternative was to leave a blocked account in Germany. This meant that

insurance proceeds often had to be retained in Germany in an emigrant

blocked account. The emigrant could arrange to have money paid to his

relatives in Germany from such an account but could not use such money

for himself or have it transferred since he had become a “non-resident”

(Devisenausländer) with respect to currency matters.

The 11th Decree of the Reich Citizenship Law of November 1941

not only mandated the confiscation of all such accounts and the face

value of all insurance policies of Jews remaining in Germany but also

made banks and insurance companies liable for reporting these assets

within six months. It received further elaboration in the 13th Decree of

the Reich Citizenship Law issued on July 1, 1943 which ordered that the

assets of all deceased Jews were the property of the Reich. The 89

insurance companies operating in the Reich in 1941 had over five million

policies and were undergoing manpower rationalization because of the

war effort. There was no effective way of going through these policies

systematically to find Jews, and there are of course many names,

Rosenberg, for example, that could be Jewish. For this reason, the Reich

Group for the Insurance Industry regularly sought extensions and

exemption from penalties for delays in compliance. These were granted

only on a rather short-term basis and with the proviso that the company

would have to pay interest on the delivery of insurance assets after the

deadline. Whatever the efforts at compliance, my sense is that actual

confiscation depended on the Gestapo reporting names and policy

numbers, these often being at its disposal because of the requirement

after April 1938 that Jews report all their assets. Once such confiscation

instructions came in, the insurance companies were no less “correct” in

calculating and delivering the repurchase value of the policies to the

Revenue Offices than they had been in doing so for the rightful owners

of the policies in earlier years.

Finally, as I noted in the plenary session, the confiscation of

Jewish insurance assets spread as the Third Reich expanded. The areas

incorporated in the Reich, beginning with Austria, and going on to the

Czech lands, the Polish areas outside the General Government, and

Alsace-Lorraine. The confiscation of Jewish assets in Austria seems to
604 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

have been pursued with particular vigor, and this shows up in Austrian

files dealing with insurance issues. I have not yet done much work on

the seizure of Jewish insurance assets in the occupied areas during the

war. Various decrees issued by the military authorities and or civilian

authorities in the occupied areas of France, in Belgium and Luxembourg

in 1941 and 1942 also mandated the seizure of assets of Jews who had

fled and emigrated. In this way, the expropriation of Jewish insurance

assets by the National Socialist regime became a European-wide

phenomenon.
Mr. Tomas Jelinek

OFFICE OF THE PRESIDENT

CZECH REPUBLIC

Insurance in the Nazi Occupied Czech Lands:

 Preliminary Findings1

Break-out Session on Holocaust-Era Insurance: Historical Overview,

Nazi Confiscation of Insurance Policy Assets

An overview of the insurance industry during the Second World

War in the territories of what is now the Czech Republic is presented,

with the emphasis on the fate of the life insurance policies of the

Holocaust victims. The first chapter characterizes the Czechoslovak

insurance industry before the Second World War. The second chapter

deals with the period between 1938 and 1945, including the occupation

of the "Sudetenland" and the consequent establishment of the

"Protectorate of Bohemia and Moravia."

THE INSURANCE INDUSTRY BEFORE WWII

Inter-war Czechoslovakia2 was one of the most industrialized

countries in Central and Southeastern Europe.3 Its economy was highly

dependent on the exportation of goods, following from the fact that 70%

of the industrial production of the former Habsburg Empire was

concentrated in the Czechoslovak territory, though only 26% of the

 

1

Prepared for the Washington Conference on Holocaust-Era Assets in 1998.

Based on the findings of the Czech Working Group on Holocaust Insurance.

2

 Czechoslovakia was established on October 28, 1918. It consisted of 21% of

the former Austro-Hungarian Empire: Bohemia, Moravia, Slovakia, Silesia,

Ruthenia (Transcarpathia).

3

 The former Hapsburg Empire
606 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

Empire’s population lived there. After the disintegration of the Habsburg

Empire common market, the newly-born Czechoslovak state was faced

with the challenge of finding foreign markets for Czechoslovak goods. In

order for the economy to survive, at least 30% of industrial production

needed to be exported.4 Upon reaching this level of exportation,

Czechoslovakia became one among ten member states of the League of

Nations with the highest industrial product per capita and was also one of

the seven biggest weapon suppliers in the world.

Before the Second World War, Czechoslovakia was, in many

respects, a modern and dynamic state which was able to maintain its

democratic system throughout the rise of authoritarian regimes in the

region. However, one cannot claim that inter-war Czechoslovakia was a

free market economy. From the turn of the century, banks already had

controlling influence over numerous industries and had become a

primary force in furthering oligopolistic business organizations. The

links between banks and industrial and commercial enterprises limited

competition by internalizing functions of the market.5 The most famous

example of such an arrangement was Zivnostenska banka, which spread

its influence not only in Czechoslovakia, but also throughout

Southeastern Europe. After the world economic crises of the early

thirties, a strict exchange control and other protectionist measures were

introduced in Czechoslovakia, as they were in many countries in the

region.6 Most of the industry was organized through cartel agreements.

Inter-war Czechoslovakia was an important intermediator

between western economies, namely Britain and France, and

Southeastern Europe. In the same period Western entrepreneurs were

competing with German companies for their share of the Czechoslovak

market. Consequently, German capital tried to extend its influence in

order to undermine Czechoslovak economic connections with Western

countries and allies in the region. While the principal direct investors in

inter-war Czechoslovakia were Great Britain and France, German

entrepreneurs obtained their influence through cartel agreements.7

The Insurance sector in inter-war Czechoslovakia was

comparable to the insurance industry in any developed country. There

was a tradition of availability of all types of insurance, and

 

4

 Teichová 1994a, p.25.

5

 Teichová 1994b, p.84.

6

 Teichová 1994b, p.90.

7

 For details see Teichová 1994a and compare this argument, particularly in the

insurance industry, with Axis Penetration of European Insurance (1943) p.15-16.
HOLOCAUST-ERA INSURANCE CLAIMS 607

Czechoslovakia had very strong international ties. Foreign companies

controlled much of the industry within the country (for data on life

insurance see Table 1), while the business share of Czechoslovak

companies abroad was negligible.

The insurance industry went through a number of troublesome

transitions following the First World War. The first was the period of

transformation which occurred during the division of the territories of the

Austro-Hungarian Empire. At this time, Czechoslovakia was faced with

the task of creating an independent Czechoslovak insurance sector. The

second difficult period for the insurance industry resulted from the

economic crises of the nineteen-thirties, during which the growth of new

businesses slowed, the total sum of premiums decreased, and

administrative costs increased. The third tumultuous period for the

Czechoslovak insurance sector was the result of the collapse of the Fenix

Insurance Company in 1936, which greatly undermined the public’s trust

in the insurance industry. The incident required that the state, together

with the insurance sector, consolidate Fenix. The total loss was Kc 1,450

million,8and the regulatory organization of the insurance industry had to

be entirely revised.

Table 1 - The Life Insurance Sector during 1933-1936 (in millions of Kc)

Domestic insurance companies Foreign insurance companies

Total sum of direct and indirect business

Premium Pay out Premium Pay out

Year

Insured

 capital

Gross Net Gross Net

Insured

capital

Gross Net Gross Net

1934 9 626 471 361 146 115 6 398 304 233 120 92

1935 9583 431 327 170 130 4 142 189 142 72 53

1936 9606 441 341 168 131 4 261 195 146 76 56

Source: Kral 1937, p.130.

For the purpose of our current attempt to resolve the issue of the

insurance policies of Holocaust victims, it is important to be familiar

 

8

 Kral 1937, p.39.
608 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

with the following main legal regulations of insurance activities before

World War Two.

In 1924, the Ministry of the Interior, which was responsible for

the supervision of the insurance sector, issued a regulation forbidding

insurance companies to denominate their policies in other than

Czechoslovak currency. In 1933, the same was done for policies

denominated in gold. Also in 1933, insurance clients complained about

the unjust calculation of reduced insurance policies. Their compensation

by different companies was resolved by a regulation which stated that

those conditions had to be written on every life policy.

The most important legal change in the inter-war period was the

Law on securing the claims of insurance companies’ clients and

concerning state supervision (No.147/1934). This law mandated a

necessary level of reserve funds for insurance payments. The reserve

funds had to be held separately from the rest of the property of the

insurance companies. However, in the case of foreign companies, the law

permitted locally licensed branches of foreign companies to manage the

funds.

At the end of 1937, there were 48 domestic insurance companies

in Czechoslovakia. 24 had foreign direct investors. The total sum of

foreign holdings was Kc 32.8 million, 40% of the basic capital of all

companies with foreign participation. The most active companies were

Italian companies with a direct investment of Kc 20.8 million, followed

by German and Swiss companies with the direct investment of Kc 8

million and Kc 4 million, respectively.9

 In 1938, there were 28 domestic and 6 foreign life insurance

companies in Czechoslovakia (for details see Appendix 2). The average

life insurance policy face value was Kc 13,142 in domestic companies,

and 28,869 K in foreign companies. There were about 1.255 million

people insured with Czechoslovak companies, while foreign insurance

companies insured about 161,000 clients.

THE INSURANCE INDUSTRY IN THE YEARS 1938-194510

The question of property claims against Czechoslovakia was

raised immediately after Nazi German annexation of the so called

 

9

 Teichova 1994 a, p.34-41.

10 For basic information about the history of the Protectorate see Appendix 1.
HOLOCAUST-ERA INSURANCE CLAIMS 609

Sudetenland. Though the main concern was the division of the gold and

hard currency reserves of the Czechoslovak Central Bank, the insurance

industry was also subject to division. All insurance business in the

Sudetenland was transferred from Czechoslovak companies to German,

Austrian, Italian or Swiss insurance companies (see Table 2). Although

an international agreement about the division of insurance business

between Nazi Germany and Czechoslovakia was under preparation

before March 15, 1939, the final separation was carried over by June 30,

1939, three month after the occupation of the rest of the Czech territory.

According to the rules proclaimed by the Nazi administration all

insurance policies signed prior to October 10, 1938 at the territory of the

former Czechoslovakia (i.e. deadline for final separation of the

"Sudetenland") belonged to the insurance companies in the Protectorate

if the insurance company had established headquarters in the

"Protectorate" before December 31, 1938 and if the insured object was in

the same territory by this date. At the same time the insurance business in

Slovakia and in the areas annexed by Poland and Hungary had to be

separated.

The vast majority of the Jewish population of "Sudetenland"

escaped and moved to the territory remaining under Czechoslovak

control. One can assume that the fate of the insurance policies and other

property of those who remained was identical to that of Jews from

Germany and Austria, where policies and other property were

confiscated by the Reich. In 1943, the total premium income of

insurance companies in Sudetenland was estimated to be approximately

13 million RM in life insurance and about 30 million RM in general

insurance.11

Table 2 Transfer of Czechoslovak Insurance Activities in Sudetenland

Name of

original

company

Taken over by

Life Insurance General Insurance

Albrechticka Sudetendeutsche Union

Versicherungs - A.G.

Cechoslovia Donau-Concordia,

Lebensvers. - A.G.

Moravsko-slezska Brno

Ceska vzajemna Victoria zu Berlin

 

11 Axis penetration of European Insurance (1943), p.30.
610 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

Ceskomoravska Riunione Schles. Feuer-Vers.-

Gesellschaft

Elbe - Schaden Albingia, Vers. - A.G.

Hasicska Manheimer Lebensvers. -

Gesell., A.G.

Gothaer Feuerversicherungsbank

Koruna Rothenburger Lebensvers.,

A.G.

Sudetendeutsche Union

Versicherungs - A.G.

Kvas Donau-Concordia,

Lebensvers. - A.G.

Donau-Concordia

Allgemeine VersicherungA.G.

Erste Allg. Unfall-u.

Schadens Vers. Gesellschaft

Lipa Donau-Concordia,

Lebensvers. - A.G.

Sudetendeutsche Union

Versicherungs - A.G.

Loyd Terra, Sparu.Lebensvers.A.G.Moravsko-slezska Brno

Merkur Donau-Concordia,

Lebensvers. - A.G.

Deutsche Algemeine

Versicherungs - A.G.

Allgemeine Unfall- u.

Haftpflicht-Vers.- A.G.

MoldaviaGeneraliSekuritas

Erste Allg. Unfall-u.

Schadens Vers. Gesellschaft

Narodni Manheimer Lebensvers. -

Gesell., A.G.

Sudetendeutsche Union

Versicherungs - A.G.

Patria Donau-Concordia,

Lebensvers. - A.G.

Sudetendeutsche Union

Versicherungs - A.G.

Plananska Allgemeine Elementar

Versicherungs-A.G.

Praha Rothenburger Lebensvers.,

A.G.

Aachener u. Munchener

Feuer-Vers.-Ges.

Prazska mestska Rothenburger Lebensvers.,

A.G.

Moravsko-slezska Brno

Prvni ceska Victoria, Feuer-Vers.-A.G.

Leipziger Hagel-Vers.-A.G.

Wiener Alianz, Vers.-A.G.

Rolnicka Manheimer Lebensvers. -

Gesell., A.G.

Manheimer Vers.-Ges.

Wiener Alianz, Vers.-A.G.

Slavia Alianz

Lebensversicherungs, A.G.

Alianz, Vers.-A.G.

Wiener Alianz, Vers.-A.G.

Bayerische Vers.-Bank,

A.G.

Kraft-Vers.-A.G.

Slovanska Donau-Concordia, Moravsko-slezska Brno
HOLOCAUST-ERA INSURANCE CLAIMS 611

Lebensvers. - A.G.

Vorsorge Volksfursorge, Lebensvers.

A.G.

Vseobecna Deutsche Herold, Volks-u.

Lebensvers. - A.G.

Sudetendeutsche Union

Versicherungs - A.G.

Zemska zivotni Offentl. Vers. - Anstalt der

Sachs. Sparkassen

Offentliche-rechtliche

Sachversicherungsanstalt

Source: Marvan (1993), p.314

In order to understand more about the background the following

review shows control of individual companies by several foreign

insurance concerns and groups operating in Czechoslovakia and

"Sudetenland" at the end of 1938.12

1. Italian Group

Assicurazioni Generali Concern

Assicurazioni Generali for Czechoslovakia

Moldavia Generali

Securitas

Prvni ceska zajistovaci banka (First Czech Reinsurance Bank)

Riunione Adriatica di Sicurta Concern

Riunione Adriatica di Sicurta for Czechoslovakia

Ceskoslovenska pojistovna (Continental)

2. French Group

La Nationale - Vie

La Nationale - Incedie

3. Swiss Group

Basilejska dopravni pojistovna

Basilejska pozarni pojistovna

Svycarska narodni pojistovna

Helvetia

Concern of Zurich, Unfall-und Schaden-Vers. A.G.

Merkur

Concern of Schweizerische Ruckversicherunge-Ges.

Kotva

Dunaj

Concordia

 

12 Document from Ceska pojistovna Archive dated Oct. 8, 1938.
612 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

4. British Group

Anglo-Elementar

5. German Group

Concern of Victoria in Berlin

Victoria-Leben

Concern of Leipziger Feuer-Vers.Ges.

Union

Muncher Ruckversicherung-Ges. (group of interests)

Cechoslavia

Slovanska pojistovna

Evropska pojistovaci spolecnost

After the Nazi occupation of the rest of Czechoslovakia at the

beginning of the Second World War, the insurance companies from

nations at war with Nazi Germany halted all their activity in the

"Protectorate Bohemia and Moravia". Their business was taken over by

German companies (for example, the Anglo-Elementar Insurance

Company was taken over by Colonia from Cologne).

A few weeks after the occupation, the first insurance regulation

was introduced aiming directly at Jews. On April 29, 1939, a meeting

took place between representatives of the Ministry of the Interior, the

(formerly Czechoslovak) National Bank, and representatives of the

Deutsche Reichsbank. Consequently, the Ministry of Interior issued a

circular "Regulation of insurance conditions of non-Aryan policyholders"

(No.18623/39-16) declaring both that Jews could only receive their

insurance payments to accounts in a selected group of banks, and that

these bank accounts would be regulated by the state. Jews were not

allowed to change conditions of their insurance policies (e.g. cession,

changing of the beneficiary, etc.). 13 Exceptions could be granted by the

Ministry of Interior with the consent of the National Bank. However,

this regulation did not specify who should be considered Jewish. Later

on, in the letter of Association of Czechoslovak Insurance Companies to

all its members (dated April 17, 1939) in order to overcome this problem,

it was specified that every client had to sign a statement about his/her

Aryan origin. In the circular of the Ministry of Interior (No. 23728/39-

16) from April 27, 1939 it was stated that Jewish clients can be honored

the cash benefits up to K 5,000 by their insurance companies without the

preliminary permission of the Ministry of Interior and the National Bank.

 

13 State Central Archive MV-SR k.6352
HOLOCAUST-ERA INSURANCE CLAIMS 613

Any benefit exceeding K 5,000 could be honored without such a

permission only on condition that the money was used as a remittance of

public services, taxes, fees etc. and transferred directly to the public

revenue office. We have found several documents of Star Insurance

Company showing that such payments were realized. We may even

argue that this company tried to help Jewish clients in order to give them

some cash and its clerks calculated their benefits in such a way that they

would not exceed K 5,000.14

In June 21, 1939 the "Reichsprotektor for Bohemia and

Moravia" issued a decree about the Jewish property. For the purpose of

our discussion it is important that since that time the Jewish origin was

defined according to the Nurnberg laws at the territory of "Protectorate".

Almost all property had to be registered by July 31, 193915 and it fell

under the control of "Protectorate". Another important regulation (No.

25761/39) which significantly influenced the treatment of Jewish clients

by insurance companies was issued by the Revisory Department of

Finance Ministry in January 23, 1940. It was generally stated that all

payments to Jews have to go to their bank accounts, which were under

state control.16With this stricter regime the limited possibility for Jews to

cash directly their insurance policies, which had been in place so far,

was abolished. All individual requests of non-Aryan insurants

concerning their policies had to be submitted to the Revisory Department

of Finance Ministry for individual consideration. The Ministry of Interior

made the final decision on the individual applications based on the

reference from Finance Ministry.17

Application of all these regulations was so complicated that the

Association of Insurance Companies published a special guide for

insurance industry with respect to Jewish laws. This guide was very

detailed and it also dealt with "mixed marriage households" (i.e. Aryan

with non-Aryan). By law, Jews could only withdraw up to K 3,000 from

their bank accounts per month. However, they were obliged to pay from

this amount premiums of their private insurance policies up to the limit

of K 750 per month. If the total of the premium payments exceeded K

 

14 State Central Archive, Ministry of Interior (No.1197/40-16).

15 The definition of Jewish property was very flexible (e.g. what was Jewish

company or a company under the Jewish influence) and it was estimated about

20 billions K.

16 This regulation was reflected in the circular of Interior Ministry (No.6055/40-

16).

17 State Central Archive, Ministry of Interior (No.23293/40).
614 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

750, a person could apply to the Revisory Department for the permission

of a higher limit for monthly withdrawal. The guide was written in 1941

by Regierungsassesor Herbert Schmerling, an official from the Revisory

Department (Department No.16) of the Finance Ministry. This

Department was deeply involved in the agenda of Jewish property. An

important role in the expropriation of Jewish property in "Protectorate"

was played by Reichsbankrat Walther Untermohle who cooperated

closely with Department No.16 . As a member of the Economic

Department in the Office of the Reichsprotektor Untermohle was later

responsible for the Property Office (details see below).

Supervision of the Insurance Industry

The Insurance industry in the "Protectorate" was supervised by

the Ministry of Interior until January 15, 1942. At that time, the

responsibility was passed to the Ministry of Economy and Labor which

was under the direct control of Nazi Germany. Beginning with May 15,

1941, the insurance industry in the "Protectorate" was centralized in a

manner identical to the situation in Nazi Germany. The entire industry

was controlled through a central institution, the Central Association of

Private Insurance in Bohemia and Moravia (Zentralverband der

Vertragsversicherung in Bohmen und Maren), which was designed to

serve as an intermediate between the insurance industry and the

government. Two economic divisions were established under this

association: one for life insurance and the other for general insurance.

The chairman and vice-chairman of the association were appointed by

the Minister of the Interior (later by the Minister of Economy and

Labor). German citizen Robert Rozenkranz, previously a special envoy

of the Reichsprotektor in the organization of the Protectorate insurance

industry, was the first chairman to be appointed. Circulars of the

Association are a very good source of information on the development of

the insurance industry during the "Protectorate," particularly concerning

the issue of confiscations during the Protectorate (see Appendix 3).

Jewish emigration

At the beginning of the "Protectorate" the Jewish emigration was

still viewed by the German authorities as a main "solution of the Jewish

question." Expropriation of the property of Jewish emigrants was

organized in order to strengthen expansion of German banks and

industrial groups in the "Protectorate." Already in March 29, 1939 it was
HOLOCAUST-ERA INSURANCE CLAIMS 615

agreed by the representatives of German banks, German Ministry of

Economy, Gestapo, and Sicherheitsdienst that Jews would be allowed to

emigrate only if they left their property by a German bank. Otherwise

Gestapo would not allow them to emigrate.18 Jews seeking the

emigration permit also had to deposit their private insurance policies at

an authorized bank.19 However private insurance policies could be used

to cover the emigration tax if the emigrant and did not have other means.

The official Jewish emigration was organized by the Center for

Jewish Emigration (Zentralstelle fur judische Auswanderung)20 which

was founded by the Hitler-appointed, German Reichsprotektor

Konstantin von Neurath in July 15, 1939. This institution was supervised

by the chief of Sicherheitsdienst Walter Stahlecker, and it was closely

cooperating with Adolf Eichmann in the Berlin Gestapo Headquarters.

In order to manage the Center’s property the Emigration Fund for

Bohemia and Moravia (Auswanderungsfond) was established in March

5, 1940. The occupation authorities intended to use this Fund to support

the German settlement of the "Protectorate"21. The Center issued 16,782

passports till the first quarter of 1941. According to the report of the

Prague Jewish Community from 1942, 25,977 Jews left the Protectorate

between March 15, 1939 and November 30, 1942.

The insurance policies of people who emigrated illegal or "broke

the law" in any other way were confiscated by Gestapo. This applied to

all the former Czechoslovak citizens who decided to leave the

"Protectorate" and even to those who left before the Nazi German

occupation.

With the beginning of deportations of Jews to concentration

camps and ghettos, the Center for Jewish Emigration was responsible for

confiscation of their assets. People asked to register for transport had to

declare again all their property including their private belongings (e.g.

suits, furniture, food rations vouchers, etc.). They were forced to give

the power of attorney to the Center for Jewish Emigration to administer

this property.

 

18 Karny (1991), p.34.

19 Zajisteni zidovskeho majetku (1941), Vol. VIII., p.6.

20 It was renamed as Center for Solving of the Jewish Question (Zentralamt fur

die Regelung der Judenfrage) in August 12, 1942.

21 Karny (1991), p.64.
616 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

Property Office

Since the beginning of the occupation the Gestapo, which

ordered the confiscation of assets of the people and organizations which

were declared the "enemies of the Reich", had to look after this property

as well. However, with the growing volume of assets, this was more and

more difficult to manage (in March 1941 the total of the confiscated

property was estimated to be K 10 billion). To free Gestapo for its

original mission on September 2, 1941, the reichsprotector established

the Property Office (Vermogensamt) to administer the confiscated

property. As far as the insurance policies are concerned there is a report

of the Prague Gestapo Headquarters from July 1, 1942 which states that

K 54.4 million of repurchase value were confiscated from insurance

companies in the Protectorate. The report gives the following

breakdown:

Assicurazioni Generali in Trieste K 20,172,418

Victoria Berlin K 13,470,549

Riunione Adriatica K 5,959,330

Star-Versicherungsanstalt K 4,676,389

Prager Stadt. Versicherunsanstalt K 2,700,589

Anker (Kotva) K 2,548,180

Slavia K 2,136,240

There were other 22 insurance companies on the list, but the

amount of money confiscated from them ranged only between K 500 to

K 500,000. We do not know whether the Gestapo headquarters in Brno

filed separate reports or whether the Prague office reported for the whole

"Protectorate". It is likely that most of the policies were life insurance

policies, for the following reasons. The first, Generali, Victoria, Anker

(Kotva), and Star were licensed only for life insurance business. The

second, life insurance was the most common form of capitalized

insurance policies.

CONCLUSION

The research done so far reveals the set of rules used by the

Nazis to control insurance in the "Protectorate". The rights over the

confiscated policies were transferred to Gestapo (later the Property

Office) or the Center for Jewish Emigration. There is an evidence that
HOLOCAUST-ERA INSURANCE CLAIMS 617

these institutions were not required to have the original insurance

agreement to receive the payments.22 The history of the cash flows from

confiscated policies is not yet fully documented. The archive of the

former Czech Escomt Bank and of the Dresdner Bank could reveal the

evidence of these transactions. The recent search in the archive of the

Czech Union Bank (Deutsche Bank Group) so far uncovered

documentary evidence of the transfers of the Holocaust victims'

insurance policies to the Property Office and to the Emigration Fund.

The Czech Working Group on Holocaust Era Insurance

comprises of the representatives of President Havel's Office, of the

Federation of Jewish Communities in the Czech Republic, the Czech

Insurance Company, the Finance Ministry, and the Ministry of foreign

Affairs. In the past year the Czech authorities have been cooperating with

the US insurance regulators namely with the Holocaust Claims Project of

the Washington State Insurance Commissioner's Office. We hope that the

creation of the international commission of Holocaust insurance will

further enhance the international cooperation in this field.

References

Board of Economic Warfare, 1943, Axis Penetration of European

Insurance, US National Archives.

Chmela, Leopold, 1946, Hospodáøská okupace Èeskoslovenska její

metody a dùsledky (Znalecký posudek v procesu s K.H.Frankem),

Orbis - Praha.

Karny, Miroslav, 1991, Konecne reseni - genocida ceskych zidu,

Academia

Král, Eduard (ed.), 1937, Èeskoslovenské soukromé pojiš ovnictví v

letech 1934 - 36, Nákladem Svazu èsl. assekuraèníkù.

Král, Václav, 1958, Otázky hospodáøského a sociálního vývoje v

èeských zemích v letech 1938 - 1945 Vol.I, II, III, Nakladatelství

Èeskolovenské akademie vìd.

Marvan, Miroslav, Chaloupecký Josef, 1993, Dìjiny pojiš ovnictví v

Èeskoslovensku

1918 - 1945, Èeská pojiš ovna.

Marvan, Miroslav, Chaloupecký Josef, 1997, Dìjiny pojiš ovnictví v

Èeskoslovensku

 

22 See in Appendix 3 the Document No.4.
618 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

1945 - 1992, Èeská pojiš ovna.

Shirer, William L., 1960, The Rise and Fall of the Third Reich: A

History of Nazi Germany,

Ballantine - New York.

Teichová, Alice, 1998, Nìmecká hospodáøská politika v èeských zemích

v letech 1939-1945, V ŠE studie z hospodáøských dìjin (English

version in,..., Cambridge Press 1998).

Teichová, Alice, 1994a, Mezinárodní kapitál a Èeskoslovensko v letech

1918 - 1938, UK Karolinum.

Teichová, Alice, 1994b, Interwar Capital Markets in Central and

Southeastern Europe, p.81-91, in: Der Markt im MittelEuropa der

Zwischenkriegszeit, UK Karolinum, 1997.

Vencovský, František. 1998, Mnichov 1938 - poèátek mìnové a finanèní

devastace èeské ekonomiky, in: Finance a úvìr 9/98, Economia -

Praha.

APPENDIX 1

Historical Background of the Protectorate

(based on Mastny, Vojtech, 1971, The Czechs Under Nazi Rule: The

Failure of National Resistance, 1939-42, Columbia U.P. - New York,

pp.55-76)

Following the signing of the Munich Treaty, the Second

Czechoslovak Republic came into existence on September 30, 1938. The

Republic existed for less than six months, for on March 15, 1939, when

Hitler invaded and occupied the Czech lands. During the Second

Republic, the border areas of Bohemia and Moravia, known also as the

Sudetenland, were forced to surrender to Nazi Germany.

Based on the extent to which the Protectorate’s economic and

military infrastructure was incorporated into the Reich, one can divide

the Protectorate era into two periods. The first period, which extends

from the Protectorate’s creation in March, 1939, until the end of 1942,

has been characterized as a “strict system of [economic and military]

controls” which allowed for a certain amount of personal, economic, and

political autonomy among Protectorate citizens. The Reich market was

intended to "supplement rather than substitute for the traditional Western

markets.” However, anti-Semitic and anti-Communist legislation was

put into effect, and there was a substantial expansion of German business

interests into the territory. From the end of 1942 until the end of the war,
HOLOCAUST-ERA INSURANCE CLAIMS 619

the Protectorate economy and military were used primarily for Reich

purposes, and the Protectorate became an integral part of the Reich’s

economic infrastructure.

Preparation for the "seizure of arms and for the control of

defense industries" began at least three months before the invasion on

March fifteenth. Therefore, though the political infrastructure of the

protectorate was largely "improvised," the economic organization of the

Protectorate, along with the military organization, was handled with

extreme precision. The Czech lands were viewed as a valuable military

and economic center for the Reich, as well as a source of liquid assets

which could be converted into "sorely needed" foreign currency.

The Nazis had direct economic control through two networks;

The Economics Department in the Office of the Protector, which was a

"prolonged arm" of the Berlin Ministry of Economics, and through

military contracting. The Central Office for Public Contracts

coordinated the military production with other programs. The entire

store of Czech weapons and ammunition was secured and sent to

Germany. All defense plants were inspected, and managers were

required to provide data about input and output capacity in meticulous

questionnaires. Over two-hundred thousand patents and technical

designs were usurped by the Germans, and power stations and gas works

stations were taken over. Czech companies were forced to sell part of

their stock at prices dictated by Germans, or to create a German majority

among stockholders by increasing their capital. The Hermann Goring

works acquired capital control over the Czech leading suppliers of arms

in the Protectorate, Škoda and Brunner Waffen, and over Poldi and

Vitkovice, the largest steel producers.

Before the war, the Nazis had preceded ruthlessly to satisfy their

immediate needs in the Protectorate by seizing arms and trying to put

gold and foreign exchange at their command. As a long-term economic

policy, however, they avoided measures which would drive the Czechs to

desperation. German firms kept their activities within strict limits, under

the watchful eye of Hans Kehrl, a high official of the Reich Ministry of

Economics, who tried to prevent excesses which would cause

disruptions. The system left the Czechs enough room for their own

economic activity.

All the same, it cannot be forgotten that the Protectorate was a

militarily occupied territory. Although the Nazis did not insist upon total

economic mobilization during the first two years of the occupation, they

nevertheless transformed the newly created Czech institutions into

instruments subject to their own control. They only needed to impose
620 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

their own appointees in the Central Associations to make use of the

sweeping powers provided by the system. There were frequent incidents

of arbitrary interference on an administrative level. In several cases, the

Nazi supervisors ordered local Czech authorities to submit all business

correspondence for their approval or even insisted on the use of German

for the conduct of business in local Czech agencies.

APPENDIX 2

List of life insurance companies in 1936:

Domestic companies: Foreign companies:

1. Concordia 1. Assicurazioni Generali - Italy

2. Cechoslovakia 2. Donau (Dunaj)- Austria

3. Ceska vzajemna zivotni 3. Anker (Kotva) - Austria

4. Domov a Slovakia 4. La Nationale - France

5. Fenix (Star) 5. Riunione Adriatica - Italy

6. Hasicska 6. Victoria - Germany

7. Karpatia

8. Koruna

9. Legie

10. Loyd

11. Merkur

12. Narodni

13. Patria

14. Pece

15. Pojistovna prumyslu kvasneho

16. Praha

17. Prazska mestska a Prazska mestska zivotni a duchodova

18. Prudentia

19. Republikanska

20. Labe zivotni

21. Rolnicka

22. Slavia

23. Slovanska

24. Slovenska

25. Union

26. Vseobecna

27. Zemska
HOLOCAUST-ERA INSURANCE CLAIMS 621

APPENDIX 3

Circulars of Central Association of Private Insurance in Bohemia

and Moravia

1. Ia-44/42 Topic: Confiscation of Insurance Policies

2. Ia-51/42 Topic: Confiscation of Insurance Policies

3. Ia-17/43 Topic: Confiscation of Insurance Policies

4. Ia-23/43 Topic: Form of the Property Office which enables

confiscation without insurance policy agreement

5. Ia-2/43 Topic: List from Gestapo- confiscated property

Mr. Rudolph Gerlach

DEPARTMENT CHIEF, GERMAN FEDERAL REGULATORY

AGENCY FOR INSURANCE PRACTICES

GERMANY

Break-out Session on Holocaust-Era Insurance: Postwar

Government Compensation Programs and Nationalization

1. I take the pleasure to be one of the presenters on postwar

government compensation programs and nationalizations. I am no

historian but an officer of the German insurance supervisory authority. I

have been working on insurance issues of Holocaust victims for nearly a

year, as Chair of the BAV Working Group on Holocaust Issues and

lately as a member of the International Commission. My work is dealing

with insurance in Germany. Therefore I shall concentrate my remarks on

compensation and nationalization of insurance companies there.

There is little to say about nationalization of insurance business

in Germany, because it occurred only in East Germany, while insurance

business, like other businesses, remained in the private sector in West

Germany. In East Germany private insurance companies were

expropriated and liquidated while new state owned companies under

public law were set up. So the in West Germany still existing private

companies lost all their assets in the East.

2. This panel concerns life insurance contracts of victims of the

Holocaust. Potentially there might be claims against insurance

companies or there might be claims for compensation against the

German state.

2.1 Insurance claims:

In most cases prior to 1941 after cancellation of the insurance

contract by the Jewish policyholder the surrender value had been paid to

the policyholder. Legal consequence was: The contractual relationship

has expired by performance, the insurance company has been released

from its obligation to perform. In the lapse of time and increasing of

persecution the bank accounts of victims were frozen, so payments on

these accounts could not reach their holders anymore. Later on the

insurance companies were forced by Nazi law to turn over all surrender
624 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

values and all other payments to the German state. Therefore the life

insurance companies generally have not been enriched by Jewish life

insurance contracts. Unpaid claims are conceivable only in cases in

which the contract had not been recognized as such with a Jewish

policyholder.

The German Federal Supreme Court decided in 1953 that the

expropriations were at no time lawful and were unlawful even at the time

when they were formally effective. In paying to the Reich the surrender

value, which the Reich had expropriated, insurers were released from

their obligation. Claims of the persons concerned deriving from the

unlawful nature of the acts of the Reich in expropriating property could

be asserted under the restitution and compensation laws.

2.2 Compensation Programs:

2.2.1 Different programs were set up, first under Military

government, later under government of the German "Länder" to return

property that had been taken by Nazi government from victims

(restitution) or to compensate for loss of freedom, health, income, and

property or other financial losses (compensation).

After establishing the Federal Republic of Germany the German

government assumed responsibility for the injustices of the Nazis and

proposed legislation to continue these programs. It entered into

discussions with the State of Israel that lead to the Israel-German Treaty

of 1952. Finally a restitution law and a compensation law were enacted

by the German parliament.

The most important of these laws is the latter, the Federal

Compensation Law of 1956. It provides compensation not only to

victims of the Holocaust but to victims of all kinds of Nazi persecution.

This law contains special provisions dealing with life insurance policies:

Provisions on entitlement, the procedure, and the calculation.

The restitution and compensation program was run very

efficiently with the help and support from foreign official authorities as

well as private organizations. The compensation authorities had to

inquire abroad if they needed information. There were lawyers who

specialized in this area. Information on the compensation program was

made public in the media both in Germany and in foreign countries.

Jewish organizations were involved as well. They were entitled to

receive proceeds if no heir could be found. They also supported the factfinding and provided assistance to claimants.

Both, life insurance companies and the German federal insurance

supervisory authority, took part in the compensation procedure. The
HOLOCAUST-ERA INSURANCE CLAIMS 625

companies on request of the compensation agencies were obliged to

answer all questions they were asked by the agencies. The compensation

agencies also had to perform hearings with the insurance supervisory

authority. The supervisory authority performed audits of the insurance

companies for many years in order to confirm that the calculations were

right. The vast majority of policies belonging to victims of the Holocaust

were included in these programs (over 70 %).

Calculations and assumptions favored victims. The basic premise

of the compensation procedure was that a victim of the Holocaust should

be treated as if no persecution had ever taken place. The amount of

compensation was determined following the policy terms, considering

currency conversion and providing additional grants. Only unpaid

premiums and payments that the policyholder himself had received were

de- ducted. Payments to government authorities were not considered. 

According to the compensation program, claimants were put on

the same, or a better, footing than West German citizens who had not

been persecuted. The file examinations have shown that most policies

were cancelled by the policyholders themselves, in many other cases the

premium payment stopped. In an insurance case with no persecution

involved, the policyholder would receive much less due to this fact. Not

so the compensation law. The compensation for the policy was based on

the face value of the policy, that is the full amount of the insurance. Only

then, unpaid premiums and payments to the policyholder were deducted.

Payments to the policyholder were deducted only insofar as they actually

benefited the claimant.

In a given example, which has been approved by an actuary in

my working group and which is attached to my paper, the victim of Nazi

persecution is preferred to a non-victim considerably. He receives 2,510

DM, the latter only 815 DM, that is less than a third. Since the victim of

Nazism has received full compensation, according to the applying rules

there is no legal basis for further claims concerning the same insurance

policy.

2.2.2 Applications for compensation payments for financial loss

with regard to life insurance policies pursuant to the specific laws could

be made for a total of 13 years. The laws provided a cutoff date for

applications at the end of 1969. A reinstatement may be possible, if the

victim or the heirs can show that they did not know of the relevant facts

without any fault of their own.

According to the Law to compensate victims of National

Socialist persecution of 1994, which was enacted following German
626 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

reunification, applications for compensation can now be made also by

inhabitants of former East Germany, who had not been entitled for

compensation before the reunification.

2.2.3 According to calculations of the German Ministry of

Finance as of 1 January 1998 (s. "Frankfurter Allgemeine Zeitung", 8

Sept. 1998) German public administration has paid out through

compensation and restitution programs 102,1 Billion DM. Future

payments, especially pension payments, will amount to approximately

additional 24 Billion DM. Further payments come out of an agreement

between the Federal Government and the Jewish Claims Conference

concerning the establishment of a Fund of 200 Million DM for the aid of

Jewish victims of the Holocaust in Eastern Europe, who are needy and

have not received any compensation yet.

ATTACHMENT

GERMAN COMPENSATION LAW

Sample comparison calculations

Base data:

Sum insured: Reichsmark 10,000

Birth date June 1, 1895

Begin of insurance June 1, 1925

Maturity date June 1, 1960

Compensation proceeding (if any) June 1, 1960

Example I: No victim of Nazi-persecution

Termination of premium payment: June 1938

At maturity date (1960) policyholder is alive

Payout: 815.70 DM

Example II: Victim of Nazi persecution

Cancellation of contract and confiscation of surrender value by Nazis

June 1938

At maturity date (1960) policyholder is alive

Payout: 2,516.50 DM
HOLOCAUST-ERA INSURANCE CLAIMS 627

ATTACHMENT

DETAILED CALCULATION EXAMPLE I AND II:

Example I: No victim of Nazi persecution

sum insured 10,000 RM

conversion to non-contributory policy (1938): 4,240 RM

i. e. DM 424

profit participation and dividends: DM 138.20

old savings compensation DM 253.50

DM 815.70

deductions:

premiums DM 0.

____________________________________________________

Total benefit paid out in 1960 DM 815.70

to policyholder by insurance company

Example II: Victim of Nazi persecution

sum insured: 10,000 RM

cancellation of policy (1938), confiscation of proceeds by Nazis

surrender value: 2,110 RM

but: face value considered conversion of face value - RM - into face

value DM

assuming (fictive) premium payments DM 4,250

profit participation and dividends: DM 892.50

old savings compensation DM 429.00

 5,571.50

deductions:

no deduction of confiscated amount

premiums payable in RM converted 1:10 DM 231.40

premiums payable in DM after 1948 DM 2,823.60

Total benefit paid out 1960 DM 2,516.50

to policyholder by compensation office

Dr. Tamás Földi

DIRECTOR OF THE PUBLIC POLICY INSTITUTE

HUNGARY

Insurance Claims in a Historical Context with a

Special Regard to the Holocaust in Hungary

Break-out Session on Holocaust-Era Insurance: Postwar

Government Compensation Programs and Nationalization

SUMMARY

Recent emergence of claims by Holocaust survivors on property

lost during or after the Holocaust era is a consequence of the end of the

fall of communism in Eastern Europe. This made possible the reparation

for human and material losses in East-European countries and gave a rise

to claims by Holocaust survivors for lost assets, as well as, for those

assets which were owned by the victims of the Holocaust.

In the early seventies Germany paid reparation to individual

survivors who lived in Hungary but they received relatively low

amounts.

Hungarian governments prior to 1990 made only vague

declarations on reparation but were effectively reluctant to pay, although

Hungary had also an own share in the Holocaust misdeeds. The

reluctance was due mainly to political reasons but the relatively low

income level of the general public, the potential claims of non-Jewish

civilians were also a hindrances in this respect, aggravated by the fact

that Hungary had in the afterwar period a relatively large Jewish origin

population which is still today about 80, 000 - 100,000.

First the largest postwar inflation and later the liquidation of

private insurance companies made impossible payments to owners of

life insurance policies based on contracts concluded prior to 1945. Heirs
630 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

of Holocaust victims shared in this respect the fate of other citizens of

the country. Capital collected by mostly directly or indirectly foreignowned insurance companies could have been served as a basis for paying

insurance claims, since the loss of their Hungarian affiliates and partners

was insignificant in relation to their total capital. On the other hand

similar claims could have been raised by other Hungarian citizens who

owned insurance policies.

Recently beyond the general rules of reparation of the victims of

totalitarian regimes the Hungarian government acknowledged a special

responsibility towards the remaining Jewish population and pays an

additional [pension] to Holocaust survivors. The extension of the

respective Public Foundation by those assets which belonged to victims

without legal successors would be a justified and feasible way of

satisfying claims. According to the Hungarian legal principles

individuals have no more domestic legal title to claim for assets lost

since such claims by individuals were settled paramountly through the

Hungarian reparation legislation after 1990. This legislation covering

several acts and amendments tried to balance the payment capacity of the

country and the justified claims, but did not involve the reparation of

losses of insurance policy holders.

Motto: "A peace loving man ... does not allow

perverting his or others' truth, clear rights, doing

out of his and others' deserved claims1 by no

kind of brute force, intimidation, dissuasion, and

dirty tricks. (From the "Ten Commandments of

Policy Conduct of a Peace Loving Man" by

István Bibó).2

INTRODUCTION

Claims by Holocaust survivors and by victims of other crimes

against humanity committed by totalitarian regimes pose a number of

difficult questions. Several approaches to such problems can be applied

parallely, which do not overlap each other. The most general approach is

 

1

 italics by the author of this paper

2

István Bibó (1911-1979) one of the most eminent political thinkers, cabinet

minister during the 1956 revolution.
HOLOCAUST-ERA INSURANCE CLAIMS 631

the ethical one which condemns all crimes and justifies all claims

regardless to law or historical circumstances. Nevertheless, even this

approach cannot be totally refused as non-valid. The legal approach often

yields another judgment than the ethical one by taking into account

specific points of views that may be disregarded by a general ethical

approach. There exist a difference between the retrospective judgment of

the question and that taking into consideration specific historical

circumstances. This paper applies the last mentioned approach and tries

to reveal historical facts and describe circumstances contemporary to the

misdeeds, thus putting the question into a historical context.

Just from this point of view it is almost unavoidable to raise the

question why claims by Holocaust survivors came to the foreground of

interest after more than 50 years. Possible explanations of this are

manyfold. It can be hardly denied that the collapse of the Soviet Empire

contributed to the revival of such claims since Jews living in the satellite

countries alongside with the victims of communism have the right to be

compensated. This is the more topical since in these countries Holocaust

survivors did not get a reparation adequate to their human and personal

losses neither from their home country nor from Germany. Namely

Germany satisfied such claims to a restricted degree because the justified

suspicion that the reparation provided, will help more the communist

governments suffering of an acute shortage of Western currency than

Holocaust survivors. Other countries that hold assets of Holocaust

survivors shared this assumption. Another argument for the restricted

reparation paid to Jews in the East European countries was that in many

cases the governments of the countries concerned were themselves

accomplices in crimes committed against Jewry by the German Nazis.

Reparation was put on the agenda almost immediately after the

fall of communism. Although the solutions were different in methods

and extent in the various countries of Eastern Europe, the start of the

process activated also those survivors of Holocaust who emigrated to the

West after the war and also those who avoided persecution by emigrating

before the extermination started but left behind large assets in the

countries concerned. Many victims of the Holocaust and the persecution

prior to it placed their assets in the banks of third countries. Another

source of claims can be attributed to the fact that after the end of WW2

the victorious occupying powers confiscated in Germany or in other

countries such precious goods that belonged originally to people of

Jewish origin (gold, artifacts) but were previously confiscated by the

authorities of the countries concerned. Historical investigations which

were hindered prior to 1989 because of the bipolarity of international
632 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

relations and also the reglementations of archives, not to open their

records prior to 50 years after they were deposited, then proved the

existence of such goods. These investigations proved also that some

countries accepted the offer by communist countries in secret talks to

withhold originally Jewish property as a kind of reparation for losses

they suffered by nationalization of their property by communist

governments. Thus the fall of communism in Europe put the whole

question under a new light. Perhaps a psychological momentum can also

be [found] behind the new wave of claims. Immediately after the war

many survivors were happy because of having avoided the worst

consequences of persecution and did not take so much care about their

losses. By now even the youngest survivors of the Holocaust are

becoming elderly people. They would not like to miss the last chance to

get a reparation for their material or pecuniary losses. Many of them are

in need of a supplementary source of income in retirement especially in

East-Central- Europe.

THE HISTORICAL BACKGROUND

1. Hungary was occupied by German troops at March 19, 1944.

In April 1944 a number of legal acts were issued that deprived the Jewish

origin population, which enjoyed until then a relative good position in

Hungary in comparison to other German occupied or satellite countries,

of their human and civil rights. Their wealth was conscribed and

practically confiscated3. Except Budapest Jews, over 440,000 persons

were deported during the summer of 1944 to Auschwitz, Germany and

Austria. Out of them over 150,000 including 10,000 from Budapest came

from the present territory of Hungary. Further 90,000 – 100,000 were

deported after the mass deportation. As a consequence 200-210,000

people of the present territory and a quarter of million from the rest of

the territories under transitory Hungarian rule lost their lives.

Human losses were caused also by the Soviets. The estimated

number of those who died in Russian POW camps reached 20,000.

 

3

 The latter measure was taken by the Government Decree 1944. 1600/ME on

the registration and freezing of the property of Jews. In Magyar Közlöny.

Official Gazetteer. vol. 1944. (in Hungarian.)
HOLOCAUST-ERA INSURANCE CLAIMS 633

The number of survivors at the present territory of Hungary was

about a quarter of million and at the other territories only about 75,000.4

This ratio does not express real proportions of losses at the present

territory of Hungary since many Jews fled from last mentioned territories

to the present territory of the country.

Almost every deportee and most of those who were not deported

lost their movable properties or at least a considerable part of it.

Statistical evidence is neither available of the number of those

who lost their lives and had life insurance policies nor of the number of

those survivors who were the potential heirs of those insured.

Nevertheless, since the death toll was higher at the less developed

territories of the country than the average, one may assume that more

insured persons' legal successors survived, than of those who were not

insured and perished by the Holocaust.

Although most of the human losses occurred after the German

occupation of Hungary, losses of the Jewish origin population started

already before that period and affected not only those living within the

present borders of Hungary but also those who became subject to

Hungarian authorities as a result of the expansion of Hungarian territories

between 1938 and 1941 on account of Czechoslovakia, Romania and

Yugoslavia. Over 40,000 lives were lost as a result of two major

measures taken by the Hungarian government:

- From July 1941 those who could not prove their Hungarian

citizenship were deported to the German occupied former Polish

territories which led finally to their execution by the SS. Many lives were

lost due to the lack of food and shelter and the cruelty of Ukrainian

Nazis, who tortured them during the deportation march. Later this

measure was annulled.

- From 1939 on Jews were excluded of the normal military

service and forming for them labor service units has started which arrived

to a climax in 1944. People of Jewish origin called up to these units wear

their own civil clothing and the adaptation to changing weather was made

possible only with a help of their families, if at all. When Hungary

entered the anti-Russian war labor service units were transported to

places which became the theater of war (Ukraine) and were simple by

their circumstances much more exposed to losses of their lives than

ordinary soldiers, not to speak of the wide-spread brutality of Hungarian

soldiers who were their guards. It is difficult to distinguish between the

 

4

 For data above see Stark Tamás: Jewry during the Catastrophy Period and

after the Liberation 1939-1955. MTA Történettudományi Intézete. Budapest

1995. 109 p. (in Hungarian)
634 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

losses which occurred by their deprived situation and the losses caused

by military actions and the hard winter. Nevertheless the fact that in 1942

actions were taken by the Hungarian Ministry of Defense to refrain

brutality proves that many human losses were caused by other reasons

than winter and warfare.5

2. From October 1944 up to April 1945 the present territory of

Hungary became a theater of war. War damages, confiscation of material

and pecuniary goods by both fighting foreign armies caused a loss of 40

per cent of the estimated national wealth of the country in 1944. 0,7 per

cent of these losses were suffered by social insurance and private

insurance companies that made out in absolute terms USD 30 million of

1938 value. National income which was in the prewar years much below

the European average fell down in 1945/46 to the half of that of the

previous year, and in the next year it arrived only to 60 per cent of base

period. Due to human losses suffered per capita national income

decreased somewhat less.

3. The foreign balance of the country was characterized by a

total prewar debt of USD 578 million in October 1945, and Hungary had

to pay as reparation according to the peace treaty of Paris after deducing

the later decreases USD 131 million at 1945 prices. According to the

Potsdam Agreement in 1945, Hungary lost its 280 million USD liabilities

with Germany accumulated by wartime exports, while the claims by

Germany making out a value of USD 30 million were ceded to SovietRussia.6

4. Foreign and domestic debts, as well, as money emission by the

Soviet army and the emission of the pengö currency by the National

Bank of Hungary to cover current government expenditure and overall

shortages caused a hyperinflation of unprecedented height, which totally

ruined the actual currency system of the country. The process was halted

only in 1946 by introducing a new currency, the forint.7

 

5

 The concise history of the Holocaust in Hungary is described by Braham,

Randolph: The Politics of Genocide. The Holocaust in Hungary. Vol.1-2. New

York 1981. Columbia University Press. 1269 p.

6

Pet Iván - Szakács Sándor: The history of the Hungarian economy of four

decades 1945-1985. Vol. 1. The reconstruction and the period of directive

planning. Budapest 1985. Közgazdasági és Jogi Könyvkiadó. pp. 17-25. (in

Hungarian)

7 Ausch Sándor: Inflation and stabilization in the years 1945-1946. Budapest

1958. Kossuth Könyvkiadó. 190 p. (in Hungarian) and Pet-Szakács op. cit. 43-

76.
HOLOCAUST-ERA INSURANCE CLAIMS 635

The total collapse of the pengö currency freed the government of

the obligation to convert pengö notes to the new currency issued.8

5. Changes in property rights started immediately after the

liberation by the Russian Army of a substantial part of the Hungarian

territory of the Nazi rule. First, land was deprived of owners of large

landed estates by the land reform that distributed land among landless

rural population or nationalized it. Nationalization of non-agricultural

private property started also in 1945 with the mines, then at the end of

1946 the five biggest metallurgy and engineering companies, as well as

the major electric power stations were put under government's economic

control.9

But already prior to this, owners of companies in the

manufacturing industry were deprived of their right of disposition by the

Soviet Army, the mostly communist lead worker's councils, government

commissioners and the legal actions by the government.10

In 1947 the eight largest banks and 344 other banks and

companies were nationalized. Further major steps of nationalization

included after March 1948 the manufacturing industry and wholesale

trade later on retail trade. Also the largest part of small and medium sized

companies was either nationalized or forced into government controlled

co-operatives.

As a result of large-scale nationalization in 1948 joint stock

companies were transformed to national enterprises their stocks and

other securities issued by them became invalid. So the Stock Exchange

having been reopened in 1946 was closed in 1948 too.11

In 1952 urban and larger non-urban residential estate was also

nationalized.12 Private sector was reduced also by the forced

collectivization and as a result, its share fell under 5 per cent of the

produced GDP.

The confiscation of most of the movable and all immovable

property of emigrants was an additional violation against property rights

 

8

 See: Pet-Szakács op. cit. 62.

9

 See: Pet-Szakács op. cit. 37-75.

10 Földi Tamás: First steps of restriction of capitalists' property rights in the

Hungarian manufacturing industry (up to the Fall 1945) in Közgazdasági

Szemle. Vol.10. no. 4. April 1963 pp. 385-398 (in Hungarian)

Documents on the history of Hungarian manufacturing industry 1945-1946. In

Levéltári Közlemények. Vol. 31. 1961. pp. 205-262 (in Hungarian)

11 See: Pet-Szakács op. cit. pp. 76-103

12 Decree issued by the Presidential Council 4/1952 Magyar Közlöny. Official

Gazetteer. February 17, 1952 (in Hungarian)
636 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

that lasted throughout the whole Communist era. Emigration was rather

widespread among middle class people regardless to their ethnic origin.

About 40,000 Jews left Hungary before the Communist regime

closed the borders in 1949. In 1956, when a massive emigration took

place having embraced all strata of the society, further 20-25 thousand

Jews left the country.13

Some thousands left Hungary between 1956 and 1989 mostly

illegally, since the regime tolerated emigration to a very small extent.

Many of them were of Jewish origin. Emigration did not stop even after

1989 but remained without legal consequences.

SITUATION OF THE INSURANCE SECTOR UNTIL 1948

1. The number of insurance companies enlisted in the Insurance

Yearbook for 1943/1944 was 36.14

Prewar insurance companies were of a larger number since the

affiliates of British insurance companies having had their registered head

office outside Hungary stopped their activities after Hungary declared

war against Britain in 1941. Their assets and liabilities were transferred

to the remaining insurance companies. The total number of insurance

companies in Hungary with head office registered abroad, prior to 1941

was 22.15

Wartime inflation affected the insurance sector as well.16 Severe

losses were caused to insurance companies due to war damages of office

buildings and residential real estate owned by them, different kinds of

confiscation by the occupying foreign powers, the freezing of their bank

accounts, hyperinflation that hit their securities. The latter loss was the

more significant since during the war insurance companies were obliged

to purchase government bonds which totally lost their value. Also the

devaluation of their real estate fortune added to the dramatic situation.

Their assets ceased to bring yields even after the stabilization since rental

prices were fixed at a low level and no revaluation act was issued to

convert security values to the new currency. Insurance companies after

 

13 See: Stark op. cit. p. 107

14 Hungarian Insurance Yearbook. Vol. 35. 1943-1944. Budapest 1943. 346 p

(in Hungarian)

15 Verbal information by Dr. Gál Nyáry, legal adviser to the Center of Credit

Institutes Corp.

16 Hungarian Insurance Yearbook, 1943-1944 pp 124-127.
HOLOCAUST-ERA INSURANCE CLAIMS 637

the massive nationalization did not dispose anymore with reserves to

pay. In spite of the optimistic statements of an author, who as the editor

remarks was an eminent expert hiding under a pseudonym, insurance

companies were near to bankruptcy. To be honest to that unknown

person one has to admit that those tasks which he attached to his forecast

could not be fulfilled in the coming years.17

3. According to the last mentioned source 17 domestic and 10

foreign insurance companies were active at the insurance market. After

1945 the number of insurance companies decreased as consequence of

the take-over of nine German and Austrian owned insurance companies

by the Russian owned but in Hungary registered East-European

Insurance Corp., which followed from the decisions of the Potsdam

Agreement. Four of them were of Austrian and four of German property,

the remaining one was registered in Budapest, but since belonging to the

confiscated Anker shared the latter’s fate. Among these Allianz, Anker

and Victoria merits a special mentioning. Generali, Adria being of Italian

ownership were among those foreign insurance companies that

maintained their businesses after 1945 too. Those Austrian insurance

companies in which British, Italian or Hungarian participation could be

indicated were exempt of the confiscation. Both Italian companies

participated in Hungarian insurance companies as well.18

According to another source, published almost simultaneously,

the number of private insurance companies was only 22 out of which

seven were foreign-owned already in prewar time and two others had

new Russian owners. The difference can be attributed to different

starting points: whether these sources quoted items that were figuring at

the Registry Court or they refer only to those which actually made

businesses.19

Russian owned companies were transferred to the Hungarian

State late 1954. Insurance companies merged with the Hungarian State

Insurance Company.

 

17 Hungarian Insurance Compass, 1947. Vol. 11. Budapest 1947. Apor Sándor.

pp. 18-22. (in Hungarian)

18 Hungarian Insurance Compass 1947. pp. 123-161. and the information

provided by Dr. Nyáry

19 Business Financial and Stock Exchange Compass for the years 1947/1948.

Ed. by János Kallós. Budapest 1948. Kallós Albert pp. 249-257.
638 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

COLD NATIONALIZATION OF INSURANCE COMPANIES

1. Against the common belief insurance companies were never

nationalized, they existed formally until 1950. What happened was a

process that may be called "cold nationalization". This included the

liquidation by legal force of insurance companies. The executor of the

liquidation was the Hungarian government and the State took over also

the real estate assets of insurance companies in 1950, i.e. two years

before the general nationalization of urban residential estate.20

2. The "cold nationalization" started with merging insurance

companies into 10 which were to be liquidated. Their accounts are still

managed by the Pénzintézeti Központ Rt. (Center of Money Institutions

Inc.) an existing financial institution under government control.

3. During the liquidation insurance companies were forced to

hand over their assets and liabilities - except those related to life

insurance - to the newly established State Insurance national enterprise.

Nevertheless the latter did not become neither a proprietor - being merely

an administrator of the balances mentioned - nor a de iure successor of

the liquidated companies.

4. The recently established foreign insurance companies in

Hungary did not claim for being a legal successor of their pre-1950

companies since the latters were de facto liquidated by the Hungarian

government.

5. However it is an open question how much of the assets of the

foreign owned insurance companies could be saved by hidden financial

transactions of the consequences of cold nationalization or of the takeover of their assets by the Soviets.

6. Finally holders of pre 1945 insurance policies did not receive

any return on their capital accumulated.

SPECIAL ISSUES RELATING TO LIFE INSURANCE

1. Foreign companies’ role in life insurance business has

decreased in the interwar period. In 1928 their share was still almost 52.5

per cent while up to 1938 this share has reduced to 27.6 per cent,

 

20 4247/1949 Government decree amended by the 113/1950 MT Government

decree on the liquidation of some enterprises and 2444/1950 MT Government

decree on the property rights, management recording and trade of state owned

immovable property. See the respective volumes of Magyar Közlöny.
HOLOCAUST-ERA INSURANCE CLAIMS 639

although the total revenue of insurance premia did not reach the 1930

level up to 1940. The decrease of foreign share was mainly due to the

bankruptcy of the Austrian Phoenix Insurance Corp., a major actor in the

life insurance business whose assets were taken over by a company

registered among Hungarian insurance companies. Another factor of the

decrease was the enlargement of the territory of Hungary after 1939

where mostly Hungary based companies could raise their share in

insurance business although to a lesser extent in life insurance than in the

total insurance business.21

2. Until 1941 vis major clauses were valid for life and property

insurance. In 1941 a decree expanded the validity of life insurance to loss

of human life caused by war events against a minimum extra payment

out of which a fund was established to cover the expenses of insurance

companies. (This extension did not relate to property insurance.)

No distinction was made in this respect between Jews and nonJews. This situation lasted until the German occupation of Hungary. In

comparison to other compatriots Jews were de iure handicapped in

insurance matters in the period between March 19, 1944 and April,

1945.22

Nevertheless, actual conditions restricted the possibility to raise

such claims to a minimum, since the time lag between the start of such

losses and the deprivation of rights was too short for raising by

documents well established claims.

3. Prior to the stabilization in 1946 a decree generally prohibited

both active and passive insurance payments. Insurance policy holders'

rights were severely restricted in order to bring their claims in line with

remained payment capacity of the insurance companies. The revaluation

was fixed in pengö and adópengö (a money substitute). The decree

contained also the potential prolongation of the payment of dues to

maintain insurance contract of those who could fulfill their obligations.

This decree seemed to save but actually paralyzed the life insurance

sector.23

This legal action was not only aimed at the restriction of surplus

money outflow not controlled by the National Bank, but also caused by

the fact that insurance companies lost most of their assets.

 

21 Hungarian Insurance Yearbook 1943-1944. pp. 124-130.

22 Verbal information by Dr. Gál Nyáry

23 Government decree 6400/1946 ME on the revaluation of life insurance claims.

Magyar Közlöny. Official gazeteer. 1946. no. 127. June 6. (in Hungarian)
640 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

According to a cautious criticism of the decree by the

anonymous contemporary author already cited the revaluation life

insurance policies was still unripe for a final judgment, since those who

issued the decree did not take into consideration the disastrous situation

of insurance companies which are not able to collect capital only to cover

the risks involved in life insurance.24

This fact was reflected by the amendment of the 6400/1946

which prolonged the procedure of revaluation up to mid-1947.

Simultaneously it was allowed to pay rents in monthly installments at a

fixed rate corresponding to 1/5 of the nominal pengö value valid at the

end of 1944.25 Nevertheless an actual revaluation did not take place and

as a consequence no payments were possible.

During the liquidation of insurance companies life insurance was

exempt of the annihilation, but even this did not change the situation of

insurance policy holders.

According to some estimations the present value of the life

insurance claims by victims of Holocaust is about USD 2.5 billion.26

According to our own calculations some 80,000 Jewish origin people had

life insurance policies.

Only quite recently and only foreign insurance companies

admitted their responsibility for claims of former policy holders and an

agreement was reached with the Italian insurance company Generali that

shows a willingness to pay a lump sum of USD 100 million as

compensation. The discussion is still going on with Generali and also

the German Allianz is involved in such discussions.27

 

24 See Hungarian Insurance Yearbook p. 21.

25 Government decree 12.640/1946 ME on the revaluation of claims arising from

life insurance contracts aminding the decree 6.400/1946 ME.

26 The Endless Story. Recent development of reparation matters. In Szombat

1998 no. 8. p. 18.

27 The Endless Story cited above
HOLOCAUST-ERA INSURANCE CLAIMS 641

THE TREATMENT OF THE COMPENSATION OF PEOPLE OF

JEWISH ORIGIN UNTIL 199028

1. The first postwar Hungarian government acknowledged the

responsibility of the Hungarian State in face of the Jewish origin people

who lost their lives and/or property. This statement was never really

followed by government actions prior to the fall of the communist

regime. The Provisional National Government elected by the Provisional

National Assembly late 1944 established already in 1945 the

Government Commissariat for Relinquished Goods. Among the goals to

be followed figured the task to use relinquished goods without a legal

heir for the partial reparation of those who suffered damages due to

deportation, but this task was never accomplished. Goods left behind by

Hungarian Nazis or of those who took a refuge to Germany when

Russian Army neared and the inheritance of deportees were equally

treated.29

2. In 1946 a law was adopted by the Parliament on the

establishment of a "Jewish Restitution Fund" which was designed to take

over the property of those who lost their lives during the persecutions

and had no legal successors. It should have been the goal of this Fund

first to collect Jewish property, then to sell it and to support the survivors

of persecution from the acquired capital. The property to be collected

should have covered all movable and immovable property. Implementing

this law started only after the Paris Peace Treaty was signed.30

3. The Paris Peace Treaty signed by the actually communist led

Hungarian government in early1947 obliged Hungary to hand over the

property of the non-survivors without a legal successor to organizations

 

28 A summary review of the reparation process up to 1998 is presented by the

paper of Feldmájer Péter: Bitter Restitution. Szombat. English edition 1998. pp.

2-5., in Hungarian a more detailed account is given by the recent manuscript of

Lea Feldmájer, entitled "The History of the Reparation of the Jewish Community

from the Jewish Restitution Fund to the Hungarian Jewish Heritage Public

Foundation". 14 p. + supplements 10 p.

29 Ács Gábor: The non-restituted fund. In Szombat. 1995. no. 7. p. 3. (in

Hungarian)

30 Act 1946. XXV on denouncing and mildering the consequences of the

persecution suffered by teh Hungarian Jews. Corpus Iuris Hungarici, 1946. Ed.

by Vincenti G. - Gál L. Budapest no date. Franklin Társulat pp. 104-106.

reprinted in Gonda, László: Jewry in Hungary 1526-1945. Budapest 1992.

Századvég Kiadó. pp. 299-304. Government decree 3200/1947 ME published in

the respective volume of Magyar Közlöny.
642 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

of survivors in order to support them. This was in line with the formerly

mentioned Hungarian law but even this has not been really implemented

although the Jewish Restitution Fund started its operation in October

1947. In 1948 an inventory on proprietorless goods was compiled which

is still to be found in the archives of the Center for Credit Institutes Corp.

The sales of relinquished goods started after a long delay in 1949. Until

mid-1953 the Fund sold properties in a value of almost 3 million forint

legally equal to less than USD 300.000. The legal title of collection and

sales of immovable goods were largely hit by the nationalization of

residential estate that comprised also those immovables, which belonged

to the potential assets of the Fund. The sad story of the Fund ended in

1954, when its assets were transferred to the State Office of Ecclesiastic

Affairs, which sold later on step by step the relinquished properties. This

process lasted until 1981. Incomes were used to cover the expenses

arising of the legal obligation of the government which confiscated the

wealth of the Jewish Community, to fund current activities of the Jewish

religious communities. A part of this wealth was nationalized.31

Communist governments argued such a way that all citizens

enjoy social care there is no reason to create differences among citizens

according to past injuries. Facts behind this hypocritical stand show that

while reforming the pension system, pensions were determined

regardless to employment prior to 1945, a term which was prolonged in

1959 up to 1929. This meant that if somebody achieved pensioner age

(60 years) as born in 1899 and worked between 1913 and 1929 these 17

years were not regarded as active period. A hidden additional deficiency

of this new act was that between 1929 and 1933 a massive

unemployment had existed in Hungary which in fact for many shortened

the respective period by further years. In contrast to members of small

business co-operatives who were included to pension schemes already in

1951, private small shopkeepers were embraced by the pension system

not before 1962 and private retail traders even later, in 1970. These facts

clearly show that instead of the social care principle the promotion of

nationalization and government control was the leading principle of the

pension system. It can be added that many people of Jewish origin

belonged to the handicapped categories.32

 

31 Ács Gábor op. cit. pp. 4-5.

32 For the data see General Directorate of Nation-wide Social Security: Four

Decades of Social Security 1945-1985. Budapest 1985. Népszava Könyv és

Lapkiadó. pp. 11-14.
HOLOCAUST-ERA INSURANCE CLAIMS 643

4. The Hungarian government did not return confiscated Jewish

owned precious metals which were taken over at the end of the war by

the French and US army without a claim for the property and returned to

the National Bank of Hungary after the Paris Peace Treaty became valid

i.e. in 1947 and in 1948. Later these were sold by government-controlled

agencies. (For further developments see the next chapter.)

5. In 1971 between German authorities and the Budapest-based

Organization for Promoting the Interests of People Persecuted by Nazism

in Hungary an agreement was concluded about the reparation to be paid

for Jewish origin people who were Hungarian residents at the beginning

of the year. Accordingly the Organization which stood under communist

control collected claims and received German reparation. A sum of 97

million German Mark was transferred in three installments and converted

at an unrealistically low but legally valid exchange rate to the Hungarian

currency and paid out with deduction of expenses to 60,000 claimants.

Those who were subject to inhumane medical experiments received a

special reparation.33 Some German companies paid compensation to

former slave laborers who served in their factories (e.g. I.G.

Farbenindustrie).

6. The failure of the Jewish Restitution Fund was of epochal

importance. The number of people to be compensated decreased not only

by emigration but also by natural mortality. This contributed to the

decrease of Holocaust claimants during the last more than 50 years.

When comparing data of survivors i.e. potential claimants was 325,000

just after the war, in 1957 under ceteris paribus circumstances still over

200 thousand claimants should have been satisfied. In 1971 German

reparation involved merely 60,000 people and the present number of

Holocaust claimants is below 20,000 Lea Feldmájer rightly puts an

emphasize on the loss which Hungarian Jewry suffered due to the lack of

implementation of the respective laws of 1946/1947.34 The reluctance of

the post-war reparation of Holocaust survivors had another consequence

as well. During the period between 1947 and at least the beginning of the

eighties so many other injuries were committed by the communist

governments that they diminished the relative weight of the antiSemitism driven sins of the former governments, not to speak of those

 

33 Government decree 21/1971 on the satisfaction of some reparation claims by

the National Organization for Promoting the Interest of People Persecuted by

Nazism in Hungary. in Magyar Közlöny 1971. pp. 489-490. Documents from the

Archives of the Alliance of Jewish Communities in Hungary.

34 Feldmájer, Lea op. cit.
644 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

who suffered under both totalitarian regimes (forged trials, intra-country

deportation, confiscation, nationalization).

THE GENERAL PRINCIPLES OF REPARATION OF MATERIAL

LOSSES CAUSED BY TOTALITARIAN REGIMES IN HUNGARY

1. The laws issued after the political change in 1990 admitted the

responsibility of the Hungarian government for losses caused by the legal

actions of governments contradicting their responsibility to observe

human rights and general principles of law.

2. Simultaneously Hungarian legislation rejected the principle of

direct reprivatization i.e. to reestablish the property right of former

owners - except the constructed immovable formerly owned by churches

- in order to avoid endless and overcomplicated claims by more than one

owner for the same property and because of the changes in those

immovable properties during the time passed. (Some were demolished,

other were hugely expanded etc.) Law making avoided also to follow the

principle of general and unified compensation based on citizen's rights.

The law expressed a strive for determining claimants right case by case.

This determination ended in most cases in providing persons having

suffered persecution and/or material losses and their legal successors

with "reparation bills" that were intended for use to buy consumer goods,

to purchase immovable, or rights generating income, to sell them at

secondary market. These bills are traded at the Stock Exchange and

underwent considerable changes in actual value between 20 and 90 per

cent of the nominal value.

3. A further restriction in Hungarian law making is that legal

persons are excluded from the reparation process. Thus only natural

persons acquired the right to be compensated.

4. Also those foreign residents or citizens fall under reparation

laws who lived in Hungary during the periods of persecution and

suffered human and material losses.

5. In order to balance the payment capacity of the country and

the justified claims the amount of reparation is fixed at a low proportion

of the lost value.
HOLOCAUST-ERA INSURANCE CLAIMS 645

THE REPARATION FOR PEOPLE OF JEWISH ORIGIN AFTER

199035

1. In general the rules of reparation of the losses suffered by

people of Jewish origin do not differ from those relating to people who

suffered losses because other causes than racial discrimination. But this

is the final result of a prolonged discussion on Jewish claims, which

started at a zero point. Decisions by the Court of Constitution remedied

deficiencies of the original reparation acts. E.g. claims due to military

work service accomplished within the borders of Hungary were initially

not regarded as legal title for reparation. This was amended by a later act.

2. In 1993 the Court of Constitution after having investigated the

story of the Hungarian Jewish gold took a decision which excluded the

individual reparation of the former owners of the confiscated gold. The

part of this, which belonged to persons without a legal successor and was

sold by the State, is to be involved into the reparation in favor of the

propriety of a fund for Jewish reparation, an organization the creation of

which delayed until 1996.36

3. In 1996 the Hungarian Jewish Heritage Public Foundation was

established to which an annually fixed amount should be allocated by the

Budget and from this the survivors can obtain an age dependent monthly

support paid out through the Pension Fund.37

According to a message from New York dated June 7, 1997, the

Hungarian government transferred an amount of USD 28 million to the

World Jewish Congress, out of which the estimate 20.000 Hungarian

Holocaust survivors will receive a regular monthly aid.38

4. So far as the reparation of foreign residents is concerned the

following data are available.

 

35 See Feldmájer Péter op. cit.

36 Court of constitution decision 16/1993 AB (III. 12.)

37 See Szombat 1996. no. 10. pp. 6-8.

38 http://www.internet.hu/zsido/zsh 24 htm Untitled
646 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

Table 1. Reparation of foreign residents by cases and in the percentage of

the total reparation payments

Reparation by titles No. of cases Paid amounts

Reparation of personal losses 596,019 56,249,116 thousand forints

 out of which foreign residents 33.13 % 35.95 %

 USA 16,855 2.71 %

 Israel 11,980 0.80 %

 Germany 7,709 2.862 %

Reparation of lost assets 1,429,494 80,920,422 thousand forints

 out of which foreign residents 72,859 12.62%

 USA 11,388 2.13%

 Israel 3,808 0.04%

 Germany 29,548 5.14%

Source: Kárpótlás és kárrendezés Magyarországon 1989-1998

(Reparation and Setting of Claims on Losses 1989-1998), Budapest,

1998, Napvilág Publisher, pp. 685-693.

The interpretation of these data needs further investigation. It can

be supposed that a reasonable number of US claims fulfilled were raised

by non-Jews, while the data relating to Germany overwhelmingly reflect

claims raised by those German residents who were deported as a

consequence of the Postdam agreement.

5. Swiss banks and the government transferred a lump sum of

USD 8 million to the Hungarian Jewish Heritage Fund.

6. Recently also the German government shows a willingness to

pay for Holocaust survivors living in Hungary, although the requirements

set for the entitlement are far from being satisfactory, not to speak of the

procedural side.

CONCLUDING REMARKS

The problems of the reparation for people of Jewish origin is far

of the final solution. The following reasons make this solution difficult:

• the economic and of living level of Hungary and especially the

lability of the equilibrium of the central budget,

• the moral and real argument by people of Jewish origin that their

losses were disproportionate higher than those of non-Jews, also
HOLOCAUST-ERA INSURANCE CLAIMS 647

backed by the fact that many of them suffered under both totalitarian

regimes,

• the in part open, in part hidden anti-Semitism existing in the country

with the second largest Jewish community in Europe (about 80-100

thousand). Politicians in Hungary are afraid of the expansion of antiSemitism in the light of a special treatment of Jewish losses in a

country where almost each citizen suffered material losses especially

after 1944, when Hungary became a theater of war and as a

consequence of the four decades of communism. This circumstance

is considered also by the Hungarian Jewish community which is

relatively moderate in claiming for additional reparation under new

legal titles. (e.g. the author of this paper has no information about

claims against Hungarian companies or their legal successors, which

enjoyed the benefit of military labor service in their war-time

production activities. A reason for this is that many of those who

accomplished such a service were that time happy to avoid harder

circumstances than those which prevailed in most of these factories,

not to speak about those cases, where the original owners of the

workplaces were themselves, Jews. This is not a speculative example

but relates to a concrete situation well known by the author of this

paper).

• the rivalry among Jewish organizations and especially the

differences between those in Hungary and abroad,

• the fact that most of the people of Jewish origin who suffered

persecution have no real contact with any of the Jewish organizations

participating in the discussion to solve the problems,

• the reluctance of those who should pay compensation for the wealth

they acquired as a consequence of the Holocaust without hard

pressures. Recent readiness to fulfill such claims is due to avoiding

further humiliation of those institutions which were involved in

withholding Jewish property or compensation for the gains that can

be attributed to forced services by Jews during the period of

persecution.

A way out of the present situation could be that those foreign

insurance companies still existing and having been participated to a large

extent in Hungarian life insurance business should take the responsibility

for compensating the proven heirs of life insurance policy holders or the

Hungarian Jewish Heritage Foundation. Their payments would

compensate the capital collected prior to 1944 by companies which they

owned directly or indirectly. Such payments could contribute to the
648 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

compensation of survivors, whose number is diminishing day by day and

also to the preservation of Jewish cultural heritage and the constructed

objects belonging to it.

Finally, it has to be admitted that research on Holocaust

insurance claims necessitates further investigation of historical records.

This research should be accomplished in the near future. Such a research

requires substantial efforts that cannot be based exclusively on voluntary

work. Therefore, I suggest that a reasonable and proportionate amount of

the compensation paid or to be paid in the future by insurance companies

should be allocated for promoting the respective research. This proposal

is taking into account the difficulties of identifying insured Jews and

expresses also the intention to preserve the names of victims also this

way.

Acknowledgments

are due by the author of this paper to Lea Feldmájer, law student, Dr. Péter

Feldmájer, president of the Alliance of Jewish Communities in Hungary, Mrs.

Zsuzsa Földi, collaborator to the Library of the Central Statistical Office of

Hungary, Dr. Gál Nyáry, legal adviser to the Center for Credit Institutions Corp.

Budapest, Dr. Béla Révész, lecturer at the University of Szeged, and staff

member of the Public Policy Institute, for their assistance collecting

documentary material for this paper. For the errors or omissions the author bears

the only responsibility. I am also grateful to Professor Márton Tardos MP, who

called my attention to this topic.

About the author

Born in Budapest in 1929. He is of Jewish origin and survived in the ghetto in

Budapest. After having graduated at the Hungarian University of Economic

Sciences in 1952, received six years later his Doctor title in economic history.

Between 1956 and 1963 he published a series of papers on the economic history

of the postwar period. He was employed over thirty years by the Hungarian

Academy of Sciences and even today is the editor in chief of its English

language economic journal. At present besides being the director of a private

foundation based public policy institute, he is also the head of a research group

assisted by the National Scientific Research Foundation (OTKA) investigating

the reparation process in Hungary. His main publication is a two volume

trilingual encyclopedic dictionary on comparative economic systems published

in 1992 in Munich, London, New York.

Address: Public Policy Institute, Budapest 1132 Visegrádi u.4. fsz.4.

Hungary.

Tel./fax: (361) 239 1951, 239 1199 E-mail: ptia@mail.matav.hu
Prof. Vojtech Mastny

SENIOR RESEARCH SCHOLAR

WOODROW WILSON INTERNATIONAL CENTER

The Impact of Post-World War II

Nationalizations and Expropriations in East

Central Europe on Holocaust-Related Assets

Break-out Session on Holocaust-Era Insurance: Postwar

Government Compensation Programs and Nationalization

The purpose of this presentation is to examine and evaluate the

developments in the countries of East Central Europe where communist

regimes were established after World War II with regard to the causes

and consequences of the policies of nationalization and expropriation

relevant to the holocaust-related Jewish assets.

The imposition of communism on East Central Europe after the

defeat of Nazi Germany created a situation there radically different from

that in Western Europe, where the end of the war meant political

liberation, restoration of the rule of law, and continuity of the market

economy. The East Central European developments, which brought

widespread political, economic, and social damage, were complicated by

the fact that the introduction of Soviet-style communist systems as it

eventually took place after a brief period of genuine or sham coalition

governments had not originally been planned to be implemented in the

ways and at the time it was. There was less design than most

contemporaries believed during the Cold War, thus making the proper

understanding of the transitional period both crucial and difficult. The

consequences were disastrous all the same—not only for the peoples

concerned and the European order, but ultimately also for the local

communist regimes and the Soviet Union as well.

Since the conditions in all countries were not the same, also the

patterns of their development during the critical postwar years were often
650 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

quite different. Until the conclusion of the 1947 peace treaties with the

defeated countries in Europe except Germany, the distinction between

enemy and allied nations accounted for much of the difference.

Germany, Italy, Hungary, Romania, and Bulgaria were in the former,

Poland, Czechoslovakia, and Yugoslavia in the latter category, Austria

straddling uneasily both because of its having been an integral part of

Nazi Germany yet classified by the Allies for reasons of political

expediency as its victim, entitled to be reconstituted as a separate state.

In practice, the distinction was less respected albeit more readily invoked

by the Soviet Union than by the West—primarily for the sake of

economic exploitation.

Taking into account the political and economic changes that took

place, there were three distinct stages of development:

1. The immediate post-hostilities period, lasting approximately until the

end of 1945, characterized by widespread lawlessness and chaos, during

which nationalization and expropriation measures were often taken

haphazardly and inconsistently.

2. The transitional period of from 1946 to 1948, when nationalizations

and expropriations were put into effect as a result of deliberate, though

not necessarily systematic policies, introduced in ostensibly legal fashion

by governments in which communists exercised important, sometimes

decisive, influence but did not hold exclusive power.

3. Sovietization since 1948, when the Stalinist system was purposefully

imposed by the local communists on behalf of the Soviet Union in all the

areas where Moscow was firmly in control, namely, Poland,

Czechoslovakia, Hungary, Romania, and Bulgaria, as well as—with

limitations given by concern about the Western powers participating in

the control of Germany—in the Soviet zone of Germany and the Sovietoccupied part of Austria, though not in Yugoslavia where such a system

had already been introduced by the local communists on their own

initiative.

The outstanding features of the first period were indiscriminate

looting and violence by the advancing Red Army, the full dimensions of

which have only recently been revealed from evidence in former Soviet

and other communist archives.1 In this respect, the difference between

occupied and supposedly liberated countries was more in degree than in

kind. Property deemed to belong to Germans and their allies, to persons

labeled as Fascists or collaborators, and to other arbitrarily described

 

1Norman N. Naimark, The Russians in Germany: A History of the Soviet Zone of

Occupation, 1945-1949 (Cambridge: Harvard University Press, 1995).
HOLOCAUST-ERA INSURANCE CLAIMS 651

enemies was stolen, carried away, or simply destroyed. The Red Army

systematically dismantled and transported to the Soviet Union industrial

plants in not only the Soviet zone of Germany but also other territories it

had overrun. From Hungary, for example, the entire equipment and

inventory of the partly US-owned Tungsram electric company, known as

the flagship of the country's industry, was shipped away by Soviet troops

in 600 railroad cars.2

There was a measure of spontaneity in what was happening: the

Vienna populace, for example, started looting the city's leading

department store, formerly Jewish-owned, even before Soviet soldiers

came to finish the job.3 Everywhere individuals used the opportunity to

settle personal scores, or simply acted out of greed. The victims were by

no means merely Germans, let alone Nazis. They included Hungarians

living in Czechoslovakia, and sometimes anyone who spoke German,

occasionally even returning Jewish inmates of Nazi concentration camps

whose native tongue happened to be German, and German anti-Fascists.

Much of the lawlessness, however, was not only tolerated but

also encouraged by the Soviet authorities and local communist parties.

This was particularly the case in the defeated countries that were at the

mercy of the new occupation power, but was also common in the

ostensibly liberated Poland and Czechoslovakia, where provisional

coalition governments – unelected but not yet fully controlled by

communists – were allowed to perform administrative functions. The

resulting policies were not necessarily consistent. Different Soviet

agencies in occupied Germany often operated at cross purposes and in

other countries the activities of local communists were at first not

sufficiently coordinated with Moscow. Politically, the Soviet Union was

trying to win the victims of Nazism on its side, yet economically it was

antagonizing them by its rapacity. It turned over formerly German

territories to Poland, yet not before clearing away most of the movable

assets.

In Hungary, Poland, Czechoslovakia, as well as the Soviet zone

of Germany, the first radical economic measure was land reform,

implemented under direct Soviet pressure. Arguably, the breaking up of

large estates and redistribution of land were long overdue; however, the

 

2László Borhi, The Merchants of the Kremlin: Soviet Economic Penetration in

Hungary, Cold War International History Project Working Paper, forthcoming

(Washington: Woodrow Wilson International Center for Scholars, 1999), pp. 7-8.

3Guenter Bischof, The Leverage of the Weak: Austria in the First Cold War,

1945-1955 (Basingstoke: Macmillan, 1999), pp. 16, 36.
652 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

manner in which the land reform was conducted and its consequences

were destructive rather than constructive. The goal was to break the

power of the old landowning classes without giving the security of tenure

to farmers; in Czechoslovakia, much of the confiscated land became state

rather than private property. Eventually, temporary beneficiaries of the

land reforms fell victim to the Stalinist collectivization of agriculture.

Czechoslovakia was also the country where the nationalization

of industry and business, including private insurance, started first—as

early as the fall of 1945. Aimed primarily but not exclusively at

supposed national enemies and traitors, it was introduced by a series of

presidential decrees, and implemented before being ratified by the later

elected parliament. Reminiscing on the manner in which nationalization

started, the chief of the communist-controlled Czechoslovak labor unions

Antonín Zápotocký later observed that “had the party not begun pursuing

nationalization regardless of established laws, it would not have

compelled the noncommunist government to issue the nationalization

decrees . . . . We had to teach people that it was not possible to maintain

the old legality . . . but that it was important to violate it.”4

As an emergency measure—which later proved permanent—the

post-World War II governments moved quickly to freeze bank accounts

and insurance policies, denominated in deeply depreciated currencies.

Access was allowed only in exceptional cases, to be determined by the

authorities, and was seldom granted. All claims had to be reported,

sometimes within an unreasonably short time limit, after which the state

assumed the right to dispose with them.5 In Hungary, they were

effectively extinguished in August 1946 as a result of revaluation

following the currency reform that had ended the worst hyperinflation

history had seen.

The notion of “enemy assets” was used to justify arbitrary

seizure of property. All that belonged to the defeated Germans was war

booty in the Soviet view. Hence the Soviets opposed the nationalization

pursued by Austria's non-communist government, with parliamentary

support by the communists, which was intended to save the country's

enterprises from being claimed by the Soviets as German-owned.

Everywhere the alleged German assets included property stolen by the

 

4Rudé právo [Prague], 31 January 1953.

5

“Dekret presidenta republiky o znárodn_ní soukromých pojiš_oven” [Decree by

the President of the Republic on the Nationalization of Private Insurance Firms],

24 October 1945, Sbírka zákon_ a na_ízení [Collection of Laws and Ordinances],

1945, no. 103, pp. 224-31.
HOLOCAUST-ERA INSURANCE CLAIMS 653

Nazis from Jews who had perished in the holocaust or emigrated. The

newly installed governments—whether or not controlled by the

communists—made little, if any, effort to identify, much less indemnify,

the original owners, few of whom were inclined to file claims in such an

unpropitious time.

The policy, or rather the lack of policy, of the postwar

governments was consistent with their official line against anti-Semitism,

which precluded singling out Jews as a special category, and was

facilitated by the willingness of those surviving Jews who chose not to

emigrate to assimilate and adapt to the new order. This willingness,

encouraged by the Soviet Union's image as liberator from Nazism, also

helps to explain the prominence of Jews in the new government

administrations and communist party apparatus, especially pronounced in

countries where relatively higher numbers of Jews survived, notably

Hungary, but also in Poland and in Czechoslovakia.6

In traditionally anti-Semitic countries, such as Poland, anticommunism and anti-Semitism often merged. The notorious Kielce

pogrom of June 1946, carried out with the complicity of the police, has

long been regarded a provocation by the communist-controlled Warsaw

regime calculated to discredit its political opponents in the forthcoming

elections; from new evidence it appears more like a spontaneous outburst

that the regime had not anticipated and was unprepared to handle.7 All

considered, whether victims or accomplices of the emerging communist

regimes, Jews in East Central Europe remained in a precarious position.

Once the immediate postwar chaos subsided, the support for the

idea of nationalization, which extended wide across the political

spectrum in East Central Europe, did not substantially differ from its

popularity much of Western Europe. This was the time when the

bankruptcy of old-fashioned capitalism in the Great Depression was still

a fresh memory, when the notion that capitalists had precipitated the war

in order to profit from it enjoyed its superficial attraction, and when the

public ownership of the key sectors of the economy was therefore widely

regarded as not only politically correct but also socially just and

economically beneficial. In such countries as Great Britain and France,

 

6Charles Gati, “A Note on Communists and the Jewish Question in Hungary,” in

his Hungary and the Soviet Bloc (Durham: Duke University Press, 1986), pp. 100-

107; Michael Checinski, Poland: Communism, Nationalism, Anti-Semitism (New

York: Karz-Cohl, 1982), pp. 76-82.

7Andrzej Paczkowski, Pó_ wieku dziejów Polski, 1939-1989 [Half a Century of

Polish History] (Warsaw: Wydawnictwo Naukowe PWN, 1998), pp. 190-93.
654 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

nationalizations of key economic branches believed to be in the public

interest were carried out by non-communist governments.

In East Central Europe, too, nationalization was by no means

supported only by the Soviets and the communists, nor were these

always the ones promoting it most eagerly. In Czechoslovakia, it was the

social democratic minister of industry, Bohumír Lau šman, who urged

immediate complete nationalization at a time when the communist prime

minister Klement Gottwald described such a policy as “madness.” In

Gottwald's opinion, the need was for the establishment of clear

boundaries between the nationalized and the private sectors in order to

ensure “juridical security.”8 Under the guidance they had been receiving

from Moscow, the East Central European communists did not envisage

the abolition of private enterprise within any particular time frame; in

fact, they saw in its preservation a key feature distinguishing their “new

democracies” from the Soviet system.9

The distinction conformed with the concept of “national roads to

socialism,” supported actively promoted by the Soviet Union. This did

imply eventual abolition of private enterprise though without a time

frame; at issue, for the time being, were the different ways in which this

ideological goal could be accomplished. On that subject, there were

genuine discussions among communists in each country, particularly

lively in Poland, as well as genuine differences between countries, which

set especially apart East Germany—where Moscow regarded the

preservation of private enterprise an indispensable prerequisite for

Germany's reunification under Soviet auspices.10 Thus, even though there

was no design, the policies steered by Moscow converged toward the

ideologically defined communist economic model whose attainment was

to be determined by politics rather than by economics.

In the event, the pace proved faster than originally anticipated. It

was forced by the mounting Cold War confrontation between East and

West, which Stalin had neither wanted not expected yet precipitated all

the same, and by the diminishing utility for him of the East Central

 

8

Josef Korbel, The Communist Subversion of Czechoslovakia, 1938-1948: The

Failure of Coexistence (Princeton: Princeton University Press, 1959), pp. 163-64.

9Benon Dymek, PZPR, 1948-1954 [The Polish United Workers' Party, 1948-

1954] (Warsaw: Pa_stwowe Wydawnictwo Naukowe, 1989), pp. 19-45.

10Wilfried Loth, Stalins ungeliebtes Kind: Warum Moskau die DDR nicht wollte

(Berlin: Rowohlt, 1994), pp. 142-48.
HOLOCAUST-ERA INSURANCE CLAIMS 655

European coalition governments, whose viability he had overestimated.11

But the economic transformation still preserved some specific features in

each country even after the political turnabout had taken place. These

included in Poland the creation of particularly large state enterprises, in

Czechoslovakia the nationalization of smaller units than elsewhere, in

Hungary the establishment of the most elaborate system of state control.

The prevailing pattern was that of controlling and restricting but not yet

abolishing private enterprise. This was, as Zápotocký's proclaimed it, “a

national revolution, not a social revolution . . . . it does not socialize, it

nationalizes. It does not set out to abolish private capitalist enterprises, it

puts them under control.”12

In this political and legal limbo, the private insurance industry,

together with banking, found itself in a more difficult predicament than

other economic branches. It became victim of the notion that it was the

state's obligation to provide for the protection of individuals as well as

the society against accidental damages and losses. The communists

considered the state, with its greater available resources and the

supposedly superior wisdom of its planners, more suitable to discharge

that obligation than could any private enterprise, guided by the principle

of profit. They caricatured capitalist insurance firms as inherently

dishonest.

Once private enterprise was proclaimed both economically and

morally inferior to public enterprise, it could only be made beneficial to

the people if protected against its worse instincts. In practice, this meant

cutting credit and imposing a system of regulations which, along with the

depreciation of currency, made doing sound business increasingly

difficult. As a result, most private firms became “trapped in an impasse

of shortage of money and credits, fixed prices, increasing taxation, and

accumulating deficit,” yet were forbidden to stop production.13

It was a tribute to the vitality of the remaining private enterprise,

the largely uninterrupted continuity of economic expertise, and the still

unimpaired willingness of the population to work hard that the

ideological experimentation, made worse by the drying up of foreign

economic assistance other than UNRRA because of the incipient Cold

 

11Vojtech Mastny, The Cold War and Soviet Insecurity: The Stalin Years (New

York: Oxford University Press, 1996), pp. 23-29.

12Antonín Zápotocký, Po staru se _ít nedá [We Cannot Live the Old Way]

(Prague: Práce, 1949), p. 66.

13Iván T. Berend and György Ránki, The Hungarian Economy in the Twentieth

Century (New York: St. Martin's Press, 1985), p. 193.
656 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

War, did not prevent a remarkably fast postwar recovery. This was

particularly impressive in Hungary after its 1946 currency reform. By

1948-49, Hungary, Poland, and Czechoslovakia achieved the production

levels, though not the standard of living, that had existed before the war.

The catastrophe that followed was the result of the imposition

from the outside of the Soviet model, with its rigid planning, distorted

priorities, disincentives for individual initiative, and reliance on

compulsion. The economic change that took place in 1948-49 was the

direct consequence not of the communist seizure of political power—

which had occurred gradually or abruptly in the different countries

already before—but rather of the abandonment by the communists

themselves of the concept of “national roads to socialism.” This

happened during the second half of 1948 at direct Soviet pressure in

response to the Stalin-Tito break, which led Yugoslavia on its own, antiSoviet road, as well as to the incipient recovery of Western Europe under

the Marshall Plan, which prompted Moscow to organize its European

dependencies into an economic grouping of its own, the Comecon.

The introduction of the Stalinist economic model, aimed at

wiping out the last vestiges of private enterprise, was done in a fashion

calculated to make a reversal, much less restitution, all but impossible;

the advent of socialism Soviet-style was understood by its architects as

marking the irresistible march of history. Whether the preferred way of

eliminating foreign business interests was liquidation (as in Poland and

Hungary) or takeover (as in Czechoslovakia), there was an intended

break in continuity, conducive to regarding past claims and records as

obsolete, and discarding them accordingly. In any case, the assets were

confiscated by the state.

The state monopolized all insurance, formally assuming all

liabilities of both local and foreign-based companies. In Poland, the

introduction in the fall of 1948 of the Soviet banking model, with its

management by the ministry of finance through the monopoly of the

central bank supplemented by specialized banks for particular kinds of

domestic and foreign operations, coincided with the transfer of all

insurance surpluses into the state budget. As the Cold War progressed in

the early 1950s, the Stalinist regimes also obliterated all Western

economic presence in a campaign which assumed particularly vicious

forms in Hungary—the country where such presence used to be more

extensive than elsewhere. Not only were Western enterprises and other

assets confiscated without compensation, but also local and even foreign

employees of Western firms were framed as “saboteurs” and paraded at
HOLOCAUST-ERA INSURANCE CLAIMS 657

show trials, before being condemned to long prison sentences and

eventually released for ransom.14

The trials prominently featured some of the communist officials

who had previously been instrumental in enforcing the now superseded

partial nationalization policies or had been involved in the similarly

obsolete Soviet assistance to Israel in 1948, which had failed to meet

Stalin's expectations. In that operation, which had been erroneously

calculated to manipulate the Jewish state against the West while also

being conducted for profit, Czechoslovakia had played the key role as a

Soviet subsidiary.15 Accordingly, as was Stalin's habit, its communist

officials of Jewish origin who had been involved in the operation had to

pay for his miscalculation. But his victims also included fanatical antiZionists, such as the deputy Czechoslovak minister of finance notorious

among applicants for emigration to Israel for extorting from them their

remaining property for the benefit of the state.16

By 1953 Stalin, having exhausted the utility of his Jewish

disciples among Eastern European communists, followed in Hitler's

footsteps by conducting a violent anti-Semitic campaign which was

possibly intended to culminate in genocide.17 Yet since the campaign was

cut short by his death, the Jews remaining in East Central Europe were

not singled out for a persecution anywhere comparable to Hitler's.

Instead they suffered much like all subjects of the communist regimes

from the policies of pauperization that were the end product of the

Sovietization of the economy and its militarization since 1950. Periodic

confiscations of private savings by means of “currency reforms” were

part and parcel of the system. The reforms in Poland in 1950 and in

Czechoslovakia in 1953 included, among other measures, the final

cancellation of all insurance policies, which had until then been formally

blocked.

During the subsequent periods of détente, the post-Stalinist

regimes tried reluctantly to satisfy Western demands for compensation

for nationalized foreign property, and agreements to that effect were

 

14Borhi, The Merchants of the Kremlin, pp. 49-52.

15Ji_í Dufek, Karel Kaplan, and Vladimír Šlosar, _eskoslovensko a Israel v letech

1947-1953 [Czechoslovakia and Israel in 1947-1953] (Prague: Institute for

Contemporary History, 1993).

16Meir Cotic, The Prague Trial: The First Anti-Zionist Show Trial in the

Communist Bloc (New York: Herzl Press, 1987), pp. 225-26.

17Louis Rapoport, Stalin's War against the Jews: The Doctors' Plot and the

Soviet Solution (New York: Free Press, 1990).
658 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

concluded with the United States as well as with other Western countries.

Not all of the communist countries concluded such agreements with all

the Western governments involved, and the common feature of the

settlements achieved was the gross inadequacy of the lump sums paid as

final compensation for all losses. Disbursement of these sums was left up

to the recipient governments, which followed different practices in

different countries. Indemnifying claimants who had come forward, the

Western governments did not make any particular efforts to identify and

compensate original Jewish or other owners of the properties

nationalized by the communists if claims had not been advanced.

The democratic and pro-Western governments that emerged in

East Central Europe from the wreckage of the communist regimes in

1989 have not considered compensation of insurance or other claims

from the pre-communist era a high priority. Not only did they find

themselves financially strapped by inheriting economies mismanaged by

their predecessors, but they have also been faced with a flood of more

recent claims by victims of communism, which understandably

commanded immediate attention. Thus Poland has partly paid off its own

residents for their prewar insurance policies, despite the extensive

destruction of the pertinent records, but excluded from compensation

anyone living abroad. To illustrate the complexity of the tangle on the

example of Czechoslovakia, claims have been pursued against it by the

expelled Sudeten Germans, some of whom had been beneficiaries of

Nazi-stolen Jewish property, before themselves losing this and other

property to the Czechoslovak state, for which losses they were later

partly indemnified, though not by the Czechoslovak but by the West

German government, which in turn seeks compensation from the Czech

and Slovak Republics as the legal successors of the extinct Czechoslovak

state—compensation to be balanced against restitution claims for the

damage caused by Germans in these countries during World War II.

The main conclusions to be drawn from the historical analysis of

the exceedingly complex situation that has evolved since World War II

are the following:

First: Unlike in Western Europe, in the countries that became

communist the post-1945 developments have not created clearly

identifiable winners and losers, but only different categories of losers,

Jewish and others, including the respective populations along with their

governments, besides the foreign firms unlucky enough to have done

business in the area.
HOLOCAUST-ERA INSURANCE CLAIMS 659

Second: The distinctiveness of the injustices suffered by Jews in

East Central Europe after 1945 is blurred in comparison with the unique

catastrophe of the holocaust that had taken place before.

Third: The destruction or disappearance of assets as a result of

the communist-engineered political, economic, and social upheaval and

the irrationality of the ideologically motivated policies that had caused it

have made a fair restitution of the damage difficult if not impossible.

Fourth: Such a situation makes not only legal claims very

difficult to substantiate, much less enforce, but makes also moral claims

less clear cut and persuasive than those arising from the Nazi-inflicted

injustices during World War II. Accordingly, except in the case of

clearly identifiable owners, compensation is a matter of philanthropy,

which by differentiating between Jewish and non-Jewish victims of

communism would risk reawakening in East Central Europe's fragile

democracies the very scourge of anti-Semitism that has fortunately been

receding.

Ms. Elzbieta Turkowska-Tyrluk

VICE PRESIDENT, POWSECHNY ZAKLAD UBEZPIECZEN (PZU)

POLAND

Break-out Session on Holocaust-Era Insurance: Postwar

Government Compensation Programs and Nationalizations

1. Before World War II, a widely developed insurance market

existed in Poland. In 1839, 79 insurance agencies were active, on the

territory of the Polish People’s Republic, that is;

• 15 joint stock companies, in this two companies in liquidation

and two, in relation to which under the judgement of the court of

second instance bankrupt was announced;

• 10 counter – insurance agencies, conducting business on a

broader level, of which two placed in liquidation;

• 42 small counter – insurance agencies, of which only one was a

life counter – insurance agency. From among the small counter –

insurance agencies five just before the second world war were

placed in liquidation;

• 5 public insurance agencies;

• Postal Savings Bank as a public corporation performing the

insurance business;

• 6 foreign insurance agencies: two English, two Italian, two

German.

2. After the end of World War II, pre-war insurance agency

estates were not nationalized, but their liquidation was executed. In

relation to the insurance agencies, the act from the 3rd of January 1946,

concerning the main branches of national economies, becoming the

property of the State, was not in force. (Law Gazette Nr. 3, item 17, with

later changes.)

On the 3rd of January 1947 a decree the ordering of personal and

property insurance (L. G. Nr.5 it. 230). From the day the decree comes

into force, that is the 3rd of January 1947, the local and foreign, private

insurance agencies, regardless of their legal condition, have lost their

right for a further conduct of the insurance business.
662 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

Only two pre-war insurance agencies received a license for

conducting business, in the scope, settled in the decree, that is:

1) Warta Reassurance Company J.S.C. in Warsaw and

2) Polish General Counter-Insurance, of which both were

nationalized.

In connection with the rest of the agencies the liquidation was to

be conducted by the Polish General Counter-Insurance, later transformed

into the Polish National Insurance, and for the foreign agencies, active on

Polish territory, the main representative of the foreign insurance agency

or the liquidation will be assigned by the court in virtue of its office.

However, in connection with insurance agencies, which are

engaged only in personal insurance, the liquidation of their operations

was to be performed by special, personal insurance agencies, which were

brought into being, but were never created.

However, for agencies, of which the liquidation, for whatever

reasons, was not completed on the strength of the decree’s regulations,

from 1947, according to [sec.] 2 act 1 orders of the Minister of Finance

from the 29th of June 1959 on the principles and the course of insurance

agencies liquidation, which lost the right of conducting the insurance

business (L.G. Nr. 40, it. 211), the liquidator assigned was the Polish

National Insurance.

In accordance with this, the Polish General Counter-Insurance

took over the management and property of the liquidated insurance

companies from their hitherto authorities. The liquidation was conducted

on the basis of liquidation plans confirmed by the Minister of Finance,

and during the liquidation, to ensure a proper realization of the

proceedings, generally valid legal regulations were employed.

Notwithstanding the property connections in the joint stock

capital between some liquidated agencies, principles of the separate

character of property in relation to each of the agencies were strictly

abided. In connection with this, separate balance-sheets, plans of

satisfying creditors, reports of liquidation, etc. were prepared.

Jointly the Polish General Counter-Insurance conducted the

liquidation of 25 insurance agencies that is:

• three public insurance agencies,

• six larger counter-insurance agencies,

• one small counter-insurance agency

• ten joint stock companies, in this one with the lone stock of

Polish Capital,
HOLOCAUST-ERA INSURANCE CLAIMS 663

• six foreign insurance agencies (two German, two English, and

two Italian).

In relation to two of the “larger” counter-insurance agencies,

operating in Poland before the war, that is:

• “Dniestr” Counter-Insurance Agency in Lwów

• “Karpatia” Counter, Life Insurance Agency in Lwów

Liquidation procedures were not conducted, as all the property

was left on the territory, which did not enter into the composition of the

territory of the Polish State.

From among the small counter-insurance companies only one

was liquidated, as investigations conducted by the Polish General

Counter-Insurance showed, that no property was left by these companies

for which the investigation ought to be conducted, or the existing

property was not sufficient to cover the costs of liquidation.

At this moment I would like to remark, that as far as the local

companies, also with foreign contribution of capital were brought to trial

in all virtues only up to the amount of property possessed in the balance,

the foreign companies operating in Poland were brought to trial on the

strength of art. 74 of the Polish Republic’s President order from the 26th

of January 1928 concerning supervision of insurance (L.G. Nr. 9 it. 64)

their whole property, the one found in Poland as well as the property

outside its borders. In practice this meant securing the rights of creditors

and the insured, as well as the right to demand the existing commitments

from the Head Office of the insurance company.

As I have mentioned earlier, six foreign insurance companies,

through the meditation of main agencies, operated in Poland before the

War.

In spite of provisions art. 2 para. 1 of the act from 3rd of January

1946 about the state taking over the main branches of national economies

(L. G. Nr. 3 it. 17) on the strength which the nationalization of German

insurance companies was to take place, also in relation to them

liquidation procedures were conducted.

During the procedure of their liquidation it was ascertained, that:

1) The Bavarian Insurance Company - German Joined Stock

Company - Headquarters in Katowice did not possess any movables or

real estates in Poland. No claims in connection with liquidated company

were registered, both in virtue of the insurance contracts entered before

the war, as well as in virtue of workers’ and other debts.

2) Aachen-Munich Insurance Company against the headquarters

in Katowice also did not possess any real estates and the company’s
664 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

movables found in Katowice were assigned for covering the workers’

compensation.

Both companies’ securities were not lost during the occupation

period of were removed from Germany.

Owner of English insurance companies policies: “Alliance” and

“Prudential” settled abroad, they were directed to collect the payments

from these policies at the company’s headquarters in London, as on the

Polish-English financial contract from the 11th of November 1954 they

did not provide from the funds found in Poland.

Similarly the owners of insurance policies of Italian companies

“Assicurazioni Generali” and “Riuniona Adriatica di Sicurta” who

settled abroad were directed to the Headquarters in Triest, Poland,

however, in spite of numerous negotiations: in 1959, in 1972 and in

1977, in this scope, did not sign a mutual, financial agreement with Italy.

In Poland, for the owners of the above-mentioned English and

Italian insurance companies, the payments from the policies were

covered by the Polish State from the sums gained from the properties of

those companies in Poland.

3. In a great majority of causes the one real element of assets of

the liquidated insurance companies were the real estates, usually urban,

saved after the war, of which the value was calculated according to the

technical estimated norms, taking into the account the technical state of

those real estates and also the destruction caused by the war.

The value of the securities, into which composition entered

mostly pre-war bonds issued by the state, communal union and other

long term credit institutions, such as the Bank of Local Economy, Land

Credit Associations etc. was accepted as zero, because these loans were

not repaid, and the bonds did not possess no real value.

The valuation of other bonds was done taking under

consideration: decisions of indemnification contracts entered by Poland

with other countries together on mutual terms.

To the passive debts of the liquidated companies were assigned

mostly: the costs of liquidation, commitments from the insurance

policies, taxes, stamp duties, other possible commitments and claims in

virtue of shares or stocks.

Pricing both the assets and passive debts was unified both for the

local companies, local companies with foreign stock capital and the

foreign insurance companies operating in Poland. Also the claims in

virtue of the owned policies were treated equally both in the case of

Polish citizens in the country and abroad, and citizens of other countries
HOLOCAUST-ERA INSURANCE CLAIMS 665

(apart from claims from persons living abroad directed to English and

Italian companies – justification as above).

The repayments from policies present by persons living abroad

were transferred abroad, in accordance with the contemporary law, only

after achieving a foreign permit. Depending on whether Poland signed a

mutual contract with a given country in the scope of foreign circulation,

money could be transferred either to the policy owner’s country or

transferred only to the blocked accounts of foreigners in Poland, to use in

Poland.

4. Orders of the Minister of Finance from the 29th of June 1958,

in the case of the principles and the course of liquidation of the insurance

companies, which lost the right of conducting the insurance business

originally anticipated, (section 3, act 1) that creditors of the liquidated

insurance companies should, if they have not done this in the course of

the hitherto liquidation operations, notify his liquidator in writing of his

claims, within the period of six months, counting from the day of this

orders coming into force, that is the 21st of January 1960.

In accordance with section 10 of the objective orders the

responsibility for announcing in a widely read, daily newspaper the place

and appointed time of the beginning and end of payments and imparting

information on this subject by the Polish National Insurance, was

imposed on the liquidator.

This condition was fulfilled by the PNI, which printed numerous

notices about conducting liquidation procedures of pre-war insurance

companies, both in the Polish Monitor and few other daily newspapers of

an all-Polish and local range, such as “Trybuna Ludu,” Zycle

Warszawy,” Rzeczpospolita.”

The time of submitting claims was prolonged three times, in turn

from the 31st July 1961, 30th June 1964 and finally till the 30th October

1979, in relation to the claims directed to the two last, Italian insurance

companies:

1) ITALIAN JOINT STOCK COMPANY National assurance in

Triest – Assicurazioni Generali Triesta, Management for the Republic of

Poland in Warsaw;

2) ITALIAN JOINT STOCK COMPANY Riuniona Adriatica di

Sicurta, Adriatic Insurance Company in Triest, Management for the

Republic of Poland in Warsaw;

Only these two insurance companies were not yet liquidated in

the course of the hitherto conducted procedures (notice from April 1979).
666 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

5. Compensation from the policies of the pre-war liquidated

insurance companies were repaid after presenting the original policy and

evidence of the share payments from August 1939, and each case was

dealt with separately (separate liquidation check-ups).

Commitments from the insurance contracts in relation to the

authorized persons, were regulated according to principles defined in the

general conditions of insurance, but if the total sum of those

commitments did not have coverage in the balance sum of the property

of the given liquidation mass, the payments were placed in proportion

with the existing funds.

The assignation of insurance sums in relation to the policies

stated in zlotych in gold, and made out before the 8th of November 1927,

was done by re-counting, first on the strength of the law itself in ratio 1

zloty in gold equals 1.72 zloty in circulation, and then the new sum was

accepted as the nominal sum of the policy on the 31st of August 1939,

composing the basis for later calculations, according to generally valid

principles and it was re-counted into zloty in relation 1:1, not taking into

account the height of the parity in the given pre-war period.

In the above way the recountings of the given group of policies

did not refer to the policies with the amount in zloty in gold, but made up

by different insurance companies following the date of the President

orders from the 5th November 1927, in connection with change of the

monetary system, coming into force, as these policies were calculated

according to the relation 1 zloty in gold equals 1 zloty in circulation.

Policies stated in foreign currencies, if it had not yet been done

on the strength of the law itself till the 1st of August 1934, were recounted into zloty according to suitable in-force regulations.

In every case the final sum of the policy was calculated

according to regulations of the orders of the Cabinet from the 27th of

June 1958 regarding the definition of the ratio of re- counting claims

from insurance contracts of liquidated insurance companies (L.G. Nr. 38,

it. 243).

6. Naturally, in the case of life Insurance, death suffered as the

result of the Holocaust was treated as death resisted to war procedures.

From the liquidation papers it appears, that in spite of excluding the

repayment of compensation in the case of death suffered as the result of

war procedures by particular insurance conditions, the compensations

were repaid to everyone who submitted the claim in virtue of the entered

insurance contracts.
HOLOCAUST-ERA INSURANCE CLAIMS 667

While repaying the policies qualified for repayment it was

admitted, that in reality the insured stopped to pay shares from the 1st

September 1939. As the cessation occurred without any fault on the part

of the insured, but was the result of that created by the occupant, in

Poland conditions, making it impossible for the citizens to pay the

shares, it was accepted that the responsibility of insurance companies is

not suspended and will last till the end of the war, that is till the 9th of

May 1945.

And so the insured, who lived past the day of the 9th of May

1945, were repaid the insurance sum decreased in proportion to the

period for which the premiums were paid before the 1st of September

1939 and the full period of the insurance, with deductions of policy

loans.

At the repayment also the heirs of the dead during the War, were

repaid the full sum of insurance, after the deduction of the possible loans

and overdue premiums (generally for half of the war period).

7. Poland as a country occupied by Germany during World War

II and which citizens suffered a great deal from the hands of the Nazi

occupant, up till this day did not get the full settlement of compensation

for the victims of the Nazi crimes on the part of Germany. No

compensation program existed for the victims of Holocaust.

It should, however, be noticed that on the 16th of October 1991

as the cause of an agreement between the Republic of Poland’s

Government and the German Federal Republic, a foundation, “The

Polish-German Reconciliation” was founded, which operated according

to the legal regulations in force in the Republic of Poland.

On the strength of the above-mentioned agreement, the GFR

Government, actuated by humanitarian reasons, donated 500 million DM

for granting help to the victims who especially suffered by Nazi

persecutions.

The “Reconciliation” Foundation grants financial help, one time

performance character. The help granted by the Foundation is not a

compensation and cannot be treated as satisfaction for all the suffered

wrongs.

Polish citizens, as well as those of Jewish origin, alive on the 8th

of January 1992, who in personally deposed the application, living

permanently on the Republic of Poland’s territory, and being victims of

special Nazi persecution, have the right of soliciting for the financial help

from the Foundation’s means, these are:

• stay in the Nazi concentration camps, ghettos and prisons;
668 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

• stay in the so-called Polenlagr, which are severe work camps for

Poles in Slaak;

• deportations from the place of settlement and forcing over the

period of over 6 months to work for the benefits of the Third

Reich;

• repressions during the stay in Stalaga;

• persecutions toward children (which during them turned 16):

a) born in the concentration camps, ghettos, prisons and the

children of the Holocaust.

b) taken away from parents for purposes of Germanization,

deported to work camps, forced to work at the place of stay;

children, whose both parents were taken to concentration

camps, imprisoned or to compulsory work, and which, were

through this devoid of parental care, as well as those born in

the Third Reich as the children of compulsory workers.

To finish I would once more like to emphasize, that in Poland,

occurred a liquidation of property of pre-war insurance companies, in

accordance with the law, and not their nationalization. This fact for a

great number of the authorized, on the basis of insurance contracts

entered before the Second World War, made possible the execution of

their rights.
Prof. Gerald D. Feldman

PROFESSOR OF HISTORY, UNIVERSITY OF CALIFORNIA, BERKELEY AND

FELLOW, AMERICAN ACADEMY IN BERLIN

UNITED STATES

Compensation and Restitution: Special Issues

Break-out Session on Holocaust-Era Insurance: Unpaid Claims

My purpose in these remarks is to try to expand somewhat on the

ways in which restitution and compensation for insurance were carried

out following the German defeat in 1945. As was the case with respect

to confiscation, so with respect to compensation and restitution, it is very

important to understand the role played by currency and exchange

regulations as well as by inflation and currency reform. Even before

Germany had been fully occupied, the Supreme Commander of the

Allied Forces had issued Law No. 53, which contained exchange

regulations that, among other things, banned the payment of life

insurance policies for persons living outside of Germany. While this

measure was obviously aimed at preventing National Socialists and

Germans abroad from getting access to their assets, it also prevented

Jewish and anti-Nazi emigrants from collecting on their life insurance as

well. Indeed, it was only in June 1950, that is, two years after the

currency reform, that the Allies were prepared to entertain individual

requests for payments of insurance to persons living abroad. Ironically,

however, these had to be paid on a blocked DM account. Procedures

were relaxed in 1951, and these peculiar restrictions were terminated

with the London Agreement of 1953. Nevertheless, DM blocked

accounts remained non-convertible until July 1958, that is, just five

months before the DM became fully convertible.

The currency reform of June 21, 1948 determined both the

currency in which insurance policies were to be denominated in the

future and the currency in which insurance compensation was finally to

be denominated. The optical impression of some Jewish émigré getting
670 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

79.87 DM in 1957 on a 5,000 RM policy taken out in 1925 is one that is

likely to produce irritation and even rage, especially when one is used to

today’s price levels and when one considers the great success and wealth

of German insurance companies at the present time. My job as an

historian, however, is to try to reconstruct past times and make what

happened then intelligible. Insurance is a liquid asset, and inflation

inevitably favors those holding material assets over those holding liquid

assets. By the time of the currency reform, the RM was virtually

worthless, and cigarettes were actually being used as a currency. In fact,

as at the end of the hyperinflation in 1923, people were turning to barter,

trading eggs, for example, for a dental examination. All currency

reforms involve an arbitrary decision about the relationship between the

old currency and the new. In 1923-1924, the German government set the

ratio of paper marks to the dollar at 4.2 trillion to 1, lopped off twelve

zeros and pegged the RM at 4.2 to 1, which was the old parity. In 1948,

when convertibility was not of significance, the value was simply set at

10 RM to 1 DM. The important thing was to create confidence by

creating a new currency, limiting the amount of currency in circulation,

and thereby inducing people to make goods available and get back to

work. All insurance policies, indeed all liquid assets, non-Jewish as well

as Jewish, were thus reduced to a tenth of their previous nominal value,

but the purpose was to create a real value. One of the most important

guarantees of such real value was the continued Allied occupation, and it

was indeed the occupation authorities in the West which helped to insure

the control of the currency and mandated its rapid acceptance. The

currency reform must be viewed as an event that made compensation of

liquid assets possible with real as opposed to worthless money. It goes

without saying, of course, that the National Socialist regime was

responsible for the necessity of currency reform, but in this instance they

had despoiled everyone by bankrupting the nation in order to help pay

for the war.

This also helps to explain why it was the German Federal

Republic, not the insurance companies, which took over the

responsibility for compensation and restitution that developed following

the treaties with Israel and the Claims Conference of 1952 and the

London Agreement of 1953. The insurance companies had been

compelled to invest heavily in German State bonds (Reichsanleihe), and

these were worthless. Prior to the currency reform the insurance

companies were limited in the amounts they could pay out to

policyholders by the occupation authorities, and their resumption of

operations depended on state guarantees. In effect, they were rendered
HOLOCAUST-ERA INSURANCE CLAIMS 671

dependent on the government for past obligations and reliant upon new

business for any future success they might have. The one significant

obligation remaining to them was to search their files for Jewish

policyholders when called upon to do so and to calculate compensation

claims according to the formula devised by the Federal Compensation

Office. As far as I can tell, they performed this task quite diligently,

charging the government about 9.50 DM for their labors.

As Dr. Gerlach has pointed out in his paper, compensation to

victims of National Socialism for insurance losses was based on the

presupposition that they would have maintained their insurance policies,

that is, paid their premiums and collected the full value of insurance

when the policy came to term were it not for their persecution. Values

and premiums for the period prior to the currency reform were calculated

in RM and then recalculated in DM. For the period after June 1948, both

values and premiums were calculated in DM. Since he has already

described and illustrated the method used, I shall not repeat what he said

here. Instead, let me turn very briefly to what happened in the Soviet

Occupation Zone of Germany and the former GDR and say a few words

about Austria. The Soviets liquidated all the old insurance companies in

1945, took over their assets, and created state companies. Policyholders

were given the option of contracting a new policy with these companies

that would automatically reinstate their old policies. The right to make

claims against the old insurers was denied. This remained the state of

affairs until the collapse of the GDR. The Unification Treaty of August

1990 has made provision for a new regulation of claims arising from the

war, but such legislation has not yet been issued. This does not,

however, preclude individual agreements between insured and previous

insurers.

Finally, let me turn to the Austrian case. Between 1959 and

1964, the Federal Government of Germany entered into a series of

bilateral agreements with a variety of countries for the purposes of

compensation of victims of Nazism. In the case of Austria, 102 million

DM was given, 96 million DM of which was used to compensate loss of

income of victims of Nazi persecution and to compensate victims in

other countries, while the remaining 6 million were to compensate for

lost property. Austria had nothing comparable to the German

compensation legislation. Insofar as insurance was concerned, the

Austrians confronted a situation similar to that of the Germans in that

their insurance companies were insolvent at war’s end. An Insurance

Transition Law of 1946 limited the amount companies could pay out,

while the Österreichisches Versicherungs AG, which was a successor to
672 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

the Phoenix--a special case because of its bankruptcy in 1936--and was

in particularly dire straits, was barred from making any payments on

policies paid up prior to May 1, 1946 and was limited in what it could

pay out on policies that were still active. These restraints were eased as

the condition of the Austrian economy stabilized. The Insurance

Reconstruction Law of September 8, 1955 mandated that claims

regarding life insurance policies created after January 1, 1946 would be

paid in full, while those created before that date would be reduced by

60%. The payment of the latter policies was to be made possible by

government bonds and cash advances. All policies were to be converted

into Austrian currency. A special fund was set up in 1955 for Phoenix

annuitants providing three million shillings annually. It is interesting to

note, in conclusion, that there were complaints about these arrangements

by victims of the National Socialist regime at the time and that the

Austrian government was charged with violating the Austrian State

Treaty. The U.S. Embassy in Vienna, however, took the position that “It

is the opinion of the Embassy that the foregoing laws are ameliorative

and not confiscatory in nature. Insofar as the insolvent ‘Phoenix’

Insurance Company is concerned, the laws were designed to rehabilitate

it and to save its assets for the benefit of all its policy holders and may be

characterized as bankruptcy or reorganization legislation.”1 Whether this

is a valid judgement or not is difficult for me to say without further

study, but I think it is interesting as a reflection of attitudes at the time

and provides some perspective from which to judge the far more

extensive and elaborate arrangements made by the German Government

with respect to compensation and restitution of victims of National

Socialism in the realm of insurance.

 

1

 James K. Penfield, Minister-Counselor of Embassy to the Department of State,

November 10, 1955, National Archives of the United States, RG 59, 863.08/11-

1955, Box 4792. I am grateful to Dr. Oliver Rathkolb for bringing this

document to my attention.
Ms. Catherine A. Lillie

DIRECTOR, HOLOCAUST CLAIMS PROCESSING OFFICE,

NEW YORK STATE BANKING DEPARTMENT

UNITED STATES

Government Compensation Programs

and Unpaid Claims

Break-out Session on Holocaust-Era Insurance: Unpaid Claims

Thank you for this opportunity to present the work of the

Holocaust Claims Processing Office. The HCPO was established by

Governor Pataki in September 1997 as a division of the New York State

Banking Department. It grew out of the NYSBD’s investigation into the

wartime activities of SBC’s, UBS’s and Credit Suisse’s New York

Agencies and was initially intended to assist claimants with unresolved

claims against Swiss financial institutions. However, it soon became

apparent that our claimants also needed help with other types of claims,

most notably insurance claims. Therefore, the HCPO added claims for

unpaid insurance policies written in Europe in the pre-war and

Holocaust-Era to its mission. The mandate did not end there. Today, the

HCPO assists claimants with a vast array of claims: the majority still

reference Swiss banks and European insurance companies, but there is an

ever increasing number of claimants filing claims for lost, looted or

stolen art, as well as for assets deposited with European financial

institutions, be they Austrian, British, Dutch, French, German, or Italian.

Overall, the HCPO has handled in excess of 5,000 inquiries in

the past year. Of these, 2,600 have been insurance-related inquiries from

22 countries and 43 states. These inquiries have generated 1,300 claims

from 18 countries and 36 states. The majority of insurance claims have

come in from the US, Canada, the United Kingdom and Australia; the

majority of domestic claims are not surprisingly from NY, IL, CA, FL,

NJ, and TX. But, essentially, it is true that wherever people fled to in the

1930s and 1940s, we now have claimants, be that as close as Canada or
674 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

as far afield as Australia or Israel. What started off as an additional

service that we wanted to offer survivors and their heirs with banking

claims has now turned out to be half the work the office does on any

given day, and on some days well more.

I hasten to point out, however, that while there are 1,300

claimants, this actually means that we have claims for more than 1,900

insured persons. The reason is simple. in many instances, individuals had

multiple policies. In other instances, the claimant may well be the sole

survivor of a sizable family, the members of which were well-insured, or

just insured. Either way, many of our cases refer to more than one policy.

Claims currently filed with the HCPO reference a little more

than 100 companies as identified by claimants. The HCPO is currently

trying to determine how many successor companies are in fact involved.

It may be as few as two dozen. The most frequently cited companies

remain Generali, Phönix, RAS, Victoria, Allianz, Anker, Basler and

Donau. But claimants have also identified Barmenia, Fonciere, Gerling,

Hermes, Isar, Lloyds, Merkur, Nordstern, ÖVAG, Swiss Life, Star and

Vita, to name but a few. We have actual policy documents in every

imaginable Central European language for some of these, and policy

numbers for many many more.

I have given much thought to how to best give you a sense of

where these policies were written, not just by whom. But the frequent

border changes in Central Europe that you are all aware of make this

challenging. When going back to reconstruct how many Polish, Czech,

Romanian, Hungarian or even Austrian claims the HCPO currently has

on its books the first question one must ask is at what point in time,

according to which borders? Roughly speaking in terms of pre-1938

borders the majority of our claims are Austrian, Polish, Czech and

Hungarian. There is also a handful of Romanian, Yugoslav and

Bessarabian claims, some of which are rather well documented. In terms

of post-1945 borders, however, the countries involved are more

numerous.

But numbers don’t tell the whole story. Our experience has been

far more complex than this. We have an exceptional team of multilingual professionals with a wide array of talents who process written

and verbal inquiries and claims in eight different languages, drawing on

their knowledge of European history, as well as their banking, insurance

and legal backgrounds. Our staff provides assistance in a variety of ways:

preparing the claims either by appointment or over the telephone. They

assist in securing documentation where claimants do not have

appropriate documents; they research successor companies where these
HOLOCAUST-ERA INSURANCE CLAIMS 675

are not known. They then continue on and submit claims to the

appropriate companies, and European regulatory authorities. The

ultimate goal is to alleviate the burden and cost that claimants have

encountered when proceeding on their own.

Claims range from the purely anecdotal, through the detailed that

are merely lacking the original paperwork, to the partially or even fully

documented cases. For the most part we are dealing with life, dowry, and

education policies, as well as the occasional annuity, property, fire,

health and pension policies. Unlike the Swiss Bank cases that we have

worked on (where only 10-15% of account holders can be linked to a

specific bank), almost 50% of the policyholders can be linked to an

insurance company.

Those who cannot provide documentation do know significant

details. What sorts of details are these? Claimants know there was

insurance; they even recall purchasing it, and they remember perhaps the

name of the agent and location. They can remember the piggy bank

sporting a company logo, which they received when purchasing a policy.

Some have memories of a fearful and frenzied attempt to bury their

documents while in the ghetto -- the only available form of safekeeping.

Unfortunately in many cases this desperate ruse failed. They remember

accompanying parents to medical exams, or to photographers for dowry

policy photographs. We have claimants who accompanied their father, an

insurance salesman, on sales trips. And we have a claimant with very

vivid memories of Generali Christmas parties in Warsaw -- both her

father and grandfather were senior managers of the Polish subsidiary of

this Italian insurance company.

We have devoted a lot of time and energy to listening very

carefully to our claimants. Often, the details that may lead us to connect

the insured to the company that wrote the policy are not apparent in the

information supplied on the claim form the HCPO uses. But extensive

follow up conversations frequently reveal a degree of detail that emerges

in the retelling of highly traumatic events. Details such as the piggy

bank, which I know was red and domed, and German. The claimant can

even place the logo on it. Unfortunately the one detail that is missing is

an accurate description of that logo. But I am hopeful that one day soon a

claimant will walk in, lamenting the loss of the paper policy but

proffering a red, domed piggy bank as proof.

Documentation, and by this I mean actual paper documentation,

where it exists is no less vivid. There are of course the handwritten lists

kept by families that itemized their assets. Moreover, claimants have prewar and wartime confirmation letters from insurance companies
676 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

referencing policy numbers and policies. In some cases we have seen

postwar confirmation of the existence of policies, and clarification of

who received the proceeds during the war. One claimant’s father owned

two life insurance policies written by Basler. They were seized by the

Nazi government in 1942 in accordance with the 11th ordinance of the

Reich’s citizenship law (25 Nov 1941) because he was “abroad”. To the

best of our knowledge, the policyholder never received restitution from

the German government. This is not an isolated case.

In 46% of cases the claimants can provide some sort of link to

the company that originally wrote the policy. These are predominantly

life and dowry policies; in some instances there are also some property,

fire, health and pension insurance policies. I stress “originally” wrote the

policy because needless to say, in many instances that is only a starting

point. We have had many claims for Phönix policies, written all over

central and Eastern Europe. As you are all well aware, Phönix went

bankrupt in 1936 and companies scrambled to carve up Phönix’s

holdings and incorporate the portfolios into their own. Thus, the Austrian

Phönix portfolio was incorporated into OVAG, the German portfolio into

Isar, the Czech portfolio into Star, the Polish portfolio into the PZU, and

so on. For policies written in contested geographical areas such as TransCarpathia, this was often just the first move and far from the last, making

successor companies difficult to research. The pre-war Nazi

consolidation of the insurance industry and the post-war reconstruction

of this industry add to the difficulties encountered in successor company

research, and nationalization issues that pertain to policies purchased in

Eastern Europe are no less complex.

The chopping and changing of company holdings is not the only

hurdle to successful research. The vast array of companies in pre-war

Europe, the tendency to buy locally, from subsidiaries of larger, more

prominent companies, complicates matters further. Moreover, Europe is

a vast place. In order to do business effectively, it had to be conducted in

a dozen languages, through local subsidiaries or branch offices. Thus,

although the companies most frequently cited by claimants are Generali,

Phönix, RAS, Victoria, Allianz, Der Anker, Basler, and Donau, they are

mentioned in a variety of different languages, frequently referring to a

local company that was backed by a home office in Vienna or Prague,

Trieste or Berlin.

But linguistic confusion is not just prevalent when trying to

determine company names. It is also apparent when trying to verify

claimants’ personal details. On the whole, people stayed put as borders

were moved around them, dominant languages and currencies changed,
HOLOCAUST-ERA INSURANCE CLAIMS 677

etc. Contested territories switched backwards and forwards between

Czechoslovakia, Hungary and Romania. Our claimants have documents

that show their names, addresses, dates of birth and value of their

policies in three different languages and currencies. Until recently one of

my favorite examples was the claimant who provided documentation

from Cluj, Kolosvar and Klausenburg – all the exact same place in

present-day Romania. But I have recently been told by an archivist at

Yad Vashem that Nagy Szolosz offers a far greater challenge – it has 26

variations!

In other examples claimants have come in convinced that the

policies they are seeking were written by one company and the HCPO’s

research has been able to determine that it was in fact quite another. How

do we do this? Let me give an example. A claimant, originally from

Vienna, came into the HCPO relatively certain that his father’s life

insurance policy was written by Der Anker or Phönix. A reasonable

assumption, given the size of these companies and the fact that the policy

was purchased in Vienna. Neither Der Anker nor Austria

Lebensversicherung (the Phönix successor) had any record. So the

HCPO researched this claimant’s father’s tax records. The

Vermögensverzeichnis on file at the Austrian Federal Archives revealed

a Victoria life insurance policy, and even cited its repurchase value as of

July 1938. Again, this is not an isolated case.

Another example is a claimant who contacted the HCPO over a

year ago. She has her Anker dowry policy purchased by her mother in

Czechoslovakia in the late 1930s to ensure an adequate dowry of 50,000

Czech Crowns. By the time the claimant found the HCPO she had

already been married and widowed twice, all without ever receiving the

dowry her mother had intended for her. To add insult to injury, this

claimant has not only the actual policy, but also every premium receipt

for every payment made, all the way into the ghetto and from there to the

camps. The claimant here is the sole survivor of a sizeable family and

this policy is the only link that remains to that pre-war world. Anker’s

home office in Vienna has consistently refused to offer payment on this

policy because it claims not to be the legal successor to the policy.

Instead, it prefers to present itself as a fellow victim, claiming to have

lost all its assets to nationalization in the former Czechoslovakia and

Hungary. Over the years, the Czech authorities have repeatedly asserted

that these policies were seized by the Nazis. Moreover, in this case,

where the policy was written in a contested territory, it was apparently

transferred to Hungarian portfolios. In any case, the German or the

Hungarian governments are cited as the more appropriate places to
678 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

address these claims. In this way, claimants have been sent from pillar to

post for over 50 years.

It is true that some of these claims were settled in the 1940s,

1950s and 1960s and restitution was indeed received by some. But in the

chaos of postwar Europe some policyholders and their heirs were missed,

even in Western Europe. While German insurance companies have

provided assistance with Western European claims that were missed in

the post-war period, policies written by Eastern European subsidiaries or

branches of Austrian, Italian or German and French companies are

generally refused. Companies cite nationalization decrees in

Czechoslovakia, Hungary and Poland, as a result of which they lost their

assets. Moreover, parent companies claim to have lost their archives

along with their other assets in nationalization. This explanation has been

offered even in cases where claimants have supplied the original policy

and premium payment receipts. Without their original archives, some

companies have been extremely unwilling to consider assessing the value

of policies presented to them.

The reasons are fairly self-explanatory of course, and have been

outlined by Prof. Feldman in the past. Jews were dispossessed of their

assets in a variety of ways, some more direct than others were. There was

outright seizure of the policy by the Gestapo after “flight” to the East, but

there was also surrender to the tax authorities to cover a variety of

punitive taxes. Or there was repurchase by the policyholder/insured in an

attempt to fund emigration. Or there was the failure to meet premium

payments, because of loss of livelihood for example. We have certainly

received very detailed information from a variety of insurance companies

listing loans that were taken out against policies, or illustrating how

failure to maintain premium payments resulted in a loss of value of the

insurance policy. Or citing repurchase dates and amounts. Unfortunately,

some of these repurchases occurred after the policyholder had already

been incarcerated or had perished in a concentration camp. Alternatively,

there are considerable payment details that have come out of Austrian

insurance companies listing exact payment dates and amounts in the

1950s. While this information is very welcome, it is also hugely

problematic: the companies cannot tell us who received those payments

in the 1950s, yet the heirs can confirm that the insured were murdered 15

years earlier.

So where do matters stand now, from the claimants’ perspective?

Before the creation of the International Commission on Holocaust-Era

Insurance Claims chaired by Lawrence Eagleburger, the HCPO had been

offered ten settlements, covering a total of 19 policies. To date none of
HOLOCAUST-ERA INSURANCE CLAIMS 679

our claimants have accepted the offers, and a brief overview may explain

why. The offers range from a low of $50 to a high of $3,000, but all

combined add up to just under $10,000. Vastly different approaches to

valuation are of course the reason for these enormous disparities. One of

our claimants who purchased a policy in 1923 in Berlin for a one-time

payment of 5,000,000 marks and a final payout of 10,000,000 in 1948

has discovered that the policy is not worth the paper it is written on. Not

only was there a period of currency stabilization just after he purchased

his policy (Germany was struggling with hyperinflation, after all), but

then there was the creation of the Reichsmark. And the creation of the

Deutschmark in 1948 three months before his policy was due wiped out

any remaining value.

Similarly, Austrian companies have been very adept at

calculating the value of the policies they wrote in the 1930s. First the

Schilling replaced the Krone. Then the Reichsmark was introduced, only

to be replaced with the new Schilling after the war. All these changes

must be accounted for. However, companies have then proceeded to

offer no interest for the fifty-plus years that followed these conversions.

Thus, claimants feel that insult has been added to injury when their four

policies are assessed at a total of $50 despite being written in gold

Schillings or gold dollars.

In many instances, companies have insisted, even where policy

documents remain, that they cannot assess the value of the asset on the

basis of these documents alone. Or they have assumed that, where

repurchase values were listed on asset declaration forms such as the

Vermögensverzeichnis, that payment was made. Who received it remains

for someone else to determine The company’s liability has been

removed. Usually these letters end with the suggestion that there may

well be more documentation elsewhere.

I will readily admit that the historian in me loves this continued

quest for more and more documentary evidence and detail. I am often

dumbfounded by the documents that claimants can provide, by the

stories of how paper was safeguarded or rescued. I am frequently amazed

at the detail that can be found on tax forms and the like if one is prepared

to look. And I could happily go on at great length about individual cases

that the HCPO has handled in the past year. But to be perfectly candid,

the historian in me is also confronted daily with a terrible conflict

inherent to this subject matter: the inevitable mortality of the generation

of survivors still with us. Our claimants are getting older every day.

Their health is not improving. That other part of me, the part that carries

the responsibility for the HCPO and its claimants, is far more enamoured
680 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

with the concept of speedily arrived at “rough” justice. Many have been

trying to arrive at resolution for more than half a century. If they are to

witness any closure for themselves, we must all work to achieve it sooner

rather than later.
Mr. Bobby Brown

ADVISER TO THE PRIME MINISTER FOR DIASPORA AFFAIRS,

PRIME MINISTER’S OFFICE

ISRAEL

Break-out Session on Holocaust-Era Insurance: Unpaid Claims

Ladies and Gentlemen:

I come to you as the Representative of an ancient people whose

history has been stolen.

Since World War II, the entire Jewish people have moved from

their countries of origin. Ask a Frenchman in Paris or an Italian in

Milano or a German in Berlin where their ancestors lie and they will take

you to the local cemetery and show you the graves of their forefathers.

They can show you the town records, the church registry and the family

bible, which lists their family tree. Almost no Jew today lives in the same

town as his grandparents. We have lost our history. We no longer

remember the maiden names of our grandmothers or the number of

uncles and cousins that we lost.

But much of that “history” was written in a most unusual

historical record - in the ledgers and policy information of European

insurance companies. There lie the maiden names, the occupations, the

addresses of the former homes and the names of the children designated

to inherit those policies.

We never assigned insurance companies the task of holding our

history; we never thought that they would record our families’ stories but

they did - and with the ferocious appetite of some Rip Van Winkle,

reawakened and with a thirst for knowledge that had been denied too

long - we now come forward and say: Give us the history that you hold;

give us the life stories of our forefathers. Tell us who we are; tell us

what happened; return to us our heritage; publish the names.

I come to you today with a message of hope; hope that we had

given up for lost; hope from the places which we thought were lost

forever.

A Jewish family having survived the ravages of the First World

War begins to build a new life for itself in the unstable political and

economic climate of Eastern or Central Europe. They buy a life

insurance policy from a trusted neighbor and friend. It is bought as a
682 WASHINGTON CONFERENCE ON HOLOCAUST-ERA ASSETS

way of saving for the uncertain days ahead. It is bought as a pension

plan; It is bought to pay for the wedding of that most precious of

treasures – a daughter. Slowly, the sky fills with the clouds of hatred,

racism, political instability and economic upheaval. Discrimination

begins. Job loss. Education denied. Degradation and violence. Our

family seeks an escape but the “civilized world” has turned its back and

refused them entrance. The confiscations, the destruction, the “roundup,” the trains, the ghettos, the dogs, the helmets, and the cursing. The

selection, the camps, the beatings, the starvation, the disease and death.

And yet, the hope that maybe, if the children live, a policy issued

in better times, will be there for a new life for the children – that after the

darkness, a new day of security and a new beginning for the precious

remnant that survives.

As the voltage on the electrified fences is turned off and the

gates opened, as a new life must be started from the ashes and tears, a

recollection of that policy, issued during better times, comes to mind. It

is the key to the door of opportunity; it is the first step on a tall staircase;

it is the past reaching out to help the future – AND IT IS DENIED.

This was the story of many. It was the story of Herman Klein,

the proprietor of the Budapest factory of the Parker Pen Company who

lost his home, his furniture, his business, and his family. In 1947,

Herman Klein spent many nights completing the forms at the Register of

Enemy Debts in his new home in Palestine. He listed every possession

in the hope that his property would be restored. He included the linen

shutters on the kitchen windows of his Budapest home, the washbasin

with pipe fittings, the gold bracelet, tie clip, ladies ring and medallion,

totaling 69 grams of gold and the 88 fountain pens that were stolen from

Herman Klein, the former Head of the Parker Pen Company. He

carefully listed his insurance policies

Providencia Insurance

Company, Budapest

Herman

Klein

Policy No

52418

Issued 22

February 1937

Providencia Insurance

Company Budapest

Herman

Klein

Policy no.

52412

Issued19

February 1937

Generali Insurance

Company, Budapest

Herman

Klein

Policy no.

64620

Issued 24

October 1929
HOLOCAUST-ERA INSURANCE CLAIMS 683

Generali Insurance

Company, Budapest

Herman

Klein

Policy No.

74490

Issued 24

February 1934

Phonix Insurance

Company

Herman

Klein

Policy no.

530258

Issued 22

December1932

Herman Klein carefully notes on the yellowed form that his

policy states that all currencies are convertible to gold. Herman Klein

never again saw his linen shutters, never again saw his 88 pens and never

received any payment for his insurance policies.

Erwin Steiner, was born in Budapest on the 6 June 1888. Erwin

sat with his insurance agent on September 9, 1927 and took out this

policy (holds up copy of Generali policy).

 It is clearly stated on this policy that in 20 years Mr. Steiner

would receive 1,000 “New York” dollars; his monthly premium would

be $14.92. But Mr. Steiner was to die in the crematoria at Auschwitz in

1944 and when Mr. Steiner’s surviving son applied to receive his father’s

bequest, he was denied because his father had stopped paying his

premiums. In the depth of the camps struggling each day for a crust of

bread and wome watery soup, Erwin no longer had any possibility to pay

$14.92 each month.

An insurance policy is a contract of faith where one side

promises to pay premiums and the other side promises protection, a

future and hope. For many Jews, it was that future, that hope and that

protection that kept them going another day, and another day, in the very

Gates of Hell.

I am a child of survivors. I am a proud representative of the

reborn State of Israel - reborn from the ashes of European Jewry and I

am full of hope. Because I have the honor to be Israel’s representative

on the International Commission on Holocaust Era Claims, I am full of

hope that the heirs of Herman Klein, the Parker Pen manufacturer from

Budapest, and the heirs of Erwin Steiner, whose ashes were lost through

the chimneys of Auschwitz, will regain the dignity that has been denied

them. The world will quickly forget the words we say here, but will

never forget the justice we seek to achieve here.

 I – with this Conference – am full of hope.