Evening star., 1934-01-07
Life Insurance Weathers Depression
BY FREDERIC J. HASKIN.

Although it was a matter discussed
only in whispers, there have been times
during the last two or three years when
oficials Of the Government and men
high in the financial world entertained
the gravest doubts as to the survival Of
the great life insurance companies.
Failure would not have been due, as in
some cases Of previous times, to mis-
management or fraud, but to the times,
to a world condition which had brought
governments tumbling into bankruptcy.
There is definite belief now that
the tide has turned and that the vast
stake Of the American people in life
insurance has been saved. More than
s100 900, ,000, 900 Of the American peoples
savings are represented by insurance
policies. Had the old-line companies
collapsed under the intense strain of
the times, the crash would have been
absolutely without precedent. The Mis-
sissippi Bubble crash would have been
a trifing incident in comparison.
The extent to which insurance and
the solidity Of insurance reaches into
every Granny OF American life some
times Is but half realized. Approx
mately 65,000 900 persons in the United
policy. This means more than half
Of the entire population. The other
half, it will be seen, are affected,
statisticaliy at least, in that they are
the beneflciarieS Of the insured. OF
course, not a few persons who are
beneficiaries are themselves insured in
favor Of still another beneficiary, so in
surance constitutes q sort OF endless
chain.
The United States Is pre-eminent in
the life insurance field. With only
something like one-sixteenth Of the
worlds population, 1t has more than
two-thirds of the worlds insurance The
United Kingdom ranks second with a
little over 8 per cent of the worlds
total. Even taking into consideration
the fact that the United Kingdom has
but one-third the American population,
the latter shows a three-to-one ad-
vantage. The English-speaking people
seem especially provident in matters Of
insurance protection, for Canada ranks
third In the world with nearly S per
cent Of the world total Canada'S per
capita insurance, obviously. is much
higher than Britain's.
Skillful Management Necessary.
The depression has had its effects on
the business, not only from the point
Of view Of the Investments held but
in relation TO the writing OF new
policies. People wholly unemployed and
people whose incomes have been cut
heavily have been unable to do more
than carry what insurance they already
hold. However, an astonishing volume
of new business has been written even
in the bad years.
In spite of lowered incomes. of un-
employment, and of doubt among some
people as TO the safety of the insurance
companies. the average for the thor
oughly depressed years Of 1881, 1882
and 1888 was more than IS 900 ,000, 900
in new business. That figure relates
TO ordinary life insurance alone In
addition there was an average of about
$4,000, 900, 900 year in new industrial
insurance. Group insurance was less
steady, falling from $e66, 100000 in
1881 to 10000 900 in 1885 first 10
months. Total new business, covering
all sorts Of life policies, amounted to
So, 900 900 in 1881, to 1854, ,000, 900
in 1892, and to so,4l6,000, 900 for the
first 10 months OF 1888.
The task of the insurance companies
in maintaining liquid condition dur
ing the depression was difhcuit one.