Advisor Today > > December 1999 Cover Story: 94 Years Tracking an Industry

Cover Story: 94 Years of Tracking an Industry

By George Norris, Associate Editor

Since its first appearance in September 1906, Life Association News has served as a sensitive monthly monitor of America’s life and health insurance industry, along with other developing financial services. For almost a century, it has been a faithful chronicler of a profession’s progress, voicing not only the current interests and concerns of the industry’s field force but also reflecting economic conditions and the social scene at any given period.

Though the editorial policy aimed at being supportive of the life underwriters’ agenda and positive about the industry in general, from the first, the magazine was surprisingly independent and often unflinchingly candid.

For many years its covers carried the slogan,

We are unsubsidized, untrammeled.

We condemn methods, not men.

We attack conditions, not companies.

We may differ, but we do not detract.

We seek fairness, not favor.

A perusal of its 1,120 issues reveals contemporary attitudes about life and reactions to national and global upheavals, along with the preoccupations, hopes and disappointments of each generation, providing a wealth of insight into the assumptions prevailing in the business community at every point in the 20th century.

A FORUM FOR A NEW CENTURY

Life Association News was in some respects the tail that wagged the dog, since the National Association of Life Underwriters began publishing its magazine before it had an established center of operations. The phenomenal growth of the organization in the early 1900s created an imperative need not only for a regular means of communication between the leadership and the members, but also a central office for coordinating its increasing activities. After a couple of years of indecision, the logistics of producing the magazine finally forced the organization to bite the bullet, rent office space in downtown Manhattan and hire a permanent editor who could also serve as managing director of the association.

What had thrust a hitherto small and somewhat exclusive association of high-minded insurance field managers into such a frenzy of activity and national prominence? It was a combination of things. Within the life insurance industry old assumptions that had worked for years were unraveling. Scandals and improprieties exposed by the "muckraker" journalists of the day had aroused an indignant public to demand close scrutiny of the life insurance business. The big questions in the public mind were: What are the companies doing with the savings of the people and are the policyholders getting a fair shake?

Suspicion soon led to widespread loss of confidence. New sales dropped alarmingly. Policyholders throughout the country began cashing in their policies or allowing them to lapse, and many agents, either from feelings of discouragement or guilt, decided to leave the business. With tensions high, legislative pressure and reform in the air, the managers of insurance sales offices wanted to make sure they had a hand in whatever decisions were coming down the road. That meant organizing.

It started innocently enough with the youthful antics of a New York society playboy—only he happened to be the vice president of a life insurance company. By 1904 stories about the internal struggles over control of the Equitable Life Assurance Society, the world’s largest life company at the time, had begun to surface. Revelations of James Hazen Hyde, the 22-year-old vice president of the company, being involved in various investment schemes and forming syndicates with J.P. Morgan and other prominent Wall Street speculators, as well as other youthful extravagances, created an impression of irresponsibility and profiteering among top management, not only at the Equitable, but at all the big life insurance companies. People quickly concluded that the companies and their agents as well were playing fast and loose with their money and their credulity.

When the New York legislature’s Armstrong Committee convened in Manhattan’s City Hall in the fall of 1905 for a three-month probe into the business, orchestrated by its chief counsel, the brilliant and persistent young Charles Evans Hughes, exorbitant commissions and bonuses going to agents, along with the cutthroat tactics then in vogue in a very competitive marketplace, got as much attention as executives’ salaries, nepotism, company lobbying expenses, withheld dividends and shady investments. As a result, hitherto passive legislatures and insurance departments in state after state began pulling in the reins on the operations of companies and their agents. Right on the heels of the Armstrong report came a Royal Commission looking into the life insurance business in the Dominion of Canada.

None of this, of course, was a surprise to members of the life underwriters associations who, with their insistence on ethical practices and high personal qualifications, had been sending up storm warnings for more than 20 years. One result of the industry turmoil was a renewed interest in NALU, seen now as the agents’ only forum providing a structure for concerted action, and perhaps the only institution in the business as yet unsullied. By 1905 NALU was already growing in numbers and importance, with 45 local associations comprising more than 2,000 members. In 1906 there were 52 associations comprising 2,260 members, including the Canadian association representing 18 locals that had joined as a single unit.

Organizing new associations throughout North America, keeping communications open and coordinating their activities, particularly those concerning legislative issues, was rapidly becoming a managerial nightmare for association leadership. Still NALU’s "office," including its archives, current records and correspondence, consisted of a few file drawers and boxes passed on from secretary to secretary. The role of NALU secretary was becoming increasingly burdensome as the position became less of an honor and more the center of association administration.

Ernest Judson Clark, general agent for the John Hancock in Baltimore, clearly realized this when the delegates at NALU’s 1904 convention in Indianapolis proposed his name for secretary. Clark, who was known as an efficient manager who "knew how to get things done," first declined the honor, but finally allowed himself to be persuaded to take the job. In 1900 he had been one of the founders of the reorganized association at Baltimore, had served as its secretary for three years and then as president in 1904. He had first come to prominence as an organizer and gracious host of the NALU’s 1903 convention in Baltimore. At 33, with his handlebar moustache, erect carriage and thick hair parted in the center after the fashion of the day, he was a strikingly handsome young man, as well as an arresting personality. A descendant of William Clark, the explorer of the Northwest, he was born in Newtonville, Ohio, June 27, 1872, and received his education at Lebanon University, before coming to Baltimore in 1896 to take over the John Hancock agency that served Maryland and Washington, D.C.

Very likely it was Clark’s mental quickness and probity, rather than his position as NALU secretary, that earned him a place as a member of the only delegation representing the life insurance business (companies were excluded) at the Chicago Convention of governors and attorneys general called by President Theodore Roosevelt in February 1906 to design uniform legislation to regulate the insurance business. Again, along with NALU’s president Charles Scovel and Edward A. Woods, both general agents at Pittsburgh, he was also a member of the first group representing NALU to testify before Congress when they appeared before the House Judiciary Committee in May regarding the Ames Bill, a proposal to draw up a model code for the insurance industry on a national basis. The bill eventually died in the House, the members concluding that Congress lacked the constitutional power to interfere, but the interesting point is that NALU was consulted.

STARTING A MONTHLY NEWSPAPER—1906-1908

Meanwhile, Ernest Clark’s office in the Calvert Building in downtown Baltimore was serving as the virtual day-to-day headquarters, not only for his insurance business but also for coordinating all of NALU’s activities. The various newsletters and other communications he arranged to be distributed nationally during the year (largely at his own expense) came to nearly 40,000 mailings, Clark estimated. He did such a splendid job, in fact, that the NALU delegates continued to elect him secretary at the next several conventions.

By 1906, the national association had at least begun picking up the tab to help cover some of Clark’s expenses, providing about $750 for clerical assistance and some of the printing bills. At the midyear meeting of the NALU executive committee, held in New York in May, Scovel, Clark and former NALU presidents Everett Plummer, general agent for Berkshire Life in Philadelphia, and William Wyman, the Berkshire’s general agent in Chicago, formed a committee to look into the feasibility of distributing a monthly newspaper that would serve as the official organ for the national association.

Plummer was enthusiastic about the scheme and even offered to underwrite some of the initial cost. He was highly respected and his opinions carried great weight among association leaders, who often consulted him for advice. One of the founders of NALU, he helped organize its first convention in Boston in 1890, and served as the national organization’s first secretary and president in 1894 while yet in his 30s, when he performed "the impossible" by inducing the major companies to form an anti-rebating compact. Standing up to the big bosses in this way made Plummer somewhat of a hero in agents’ eyes.

With Scovel and the committee’s go-ahead, executing the project fell upon Clark, who solicited the aid of Walter Sammis, insurance editor of the New York Commercial. They collaborated on the writing and editing, while Sammis made arrangements to print the first two issues gratis. Whether Sammis, Clark or someone else decided on the name, publication of Life Association News, "a monthly journal devoted to the interests of all life insurance agents," began in September 1906 so that members could see a sample before the next national convention in St. Louis.

The idea of having a monthly journal was generally well received by the delegates, although some objected that it might create competition for some of the many insurance publications and duplicate their work. Jonathan Voshell, the Metropolitan’s manager for Baltimore, wanted assurance that the association would exercise some control over the type of advertising the magazine carried. "I do not think we want to use it as a medium of advertising patent medicines and things of that sort," he said. Clark assured him that would not happen.

The first issue offered 12 pages of text with no illustrations. Length increased to 16 pages in January 1907 and was running to 28 pages by August. Subscriptions were $1 a year. Initially Clark intended that the magazine would pay for itself with subscriptions and a dollar-a-year fee from members to have their business cards included in a "Directory of Prominent General Agents" printed at the back of each issue. That way LAN would be perceived immediately as having total autonomy, free from any company influence. (Like many business publications of the day, more than one insurance periodical had a history of being well compensated for giving positive coverage to certain companies from time to time.)

This proved to be financially unrealistic, however, and the January 1907 issue contained the magazine’s first company ad for United Surety Company of Baltimore (Clark was the company’s vice president) and by the following year company advertisements were taking up two to three pages. NALU president Charles Jerome Edwards of Brooklyn later explained the change in policy to the delegates at the 1909 convention in Louisville: "I early perceived the News could not be made to pay, even a part of its way, by depending entirely upon the subscriptions and advertisements of our members, and saw no objection to company advertisement. I authorized that it be accepted, and we now carry the advertisements of practically all the standard companies. The fear that we might become subsidized or fall under company control is not pertinent to the conditions which exist, and at no time has there been an intimation of any kind from any company official and we have persistently refrained from mention of any company in our columns, either in criticism or laudation."

Clark hoped Sammis would continue as editor, but other business obligations prevented him from committing himself to the project. On Sammis’ advice, the committee contracted with Nathan H. Weed, editor of Life Insurance Independent, whose offices were at 35 Liberty St. in lower Manhattan’s financial district, to become editor and publisher. With a staff of one, Thomas Scanlon, serving as associate editor, Weed took over responsibility for getting the magazine out each month in January 1907.

The Early Issues

Association members and insurance journalists quickly adopted the habit of referring to NALU’s new journal as simply "the News." The first issues (or "numbers," as they were usually called) were a combination of association boosting, convention promoting, opinion, exhortation and industry news and gossip. As might be expected, much of the news and opinion dealt with the fallout from the Armstrong hearings. The progress of proposals to amend Section 97 of the New York insurance law, which severely limited agents’ and general agents’ compensation, appeared in almost every issue for a while.

Weed set a pattern. Like any editor, he aimed to give the readers what they wanted and to satisfy the expectations of the owners, in this case, the association officers. Certain features of the magazine’s format and content would become standard for the next 65 years, at least. The summer issues always contained some promotional material to encourage attendance at the association’s annual convention, while the October or November issue would be primarily a review of the convention. Editors never had to plan the "convention number," since a summary of the high points and social events with photos, along with the texts of committee reports and the guest speakers’ presentations, would fill all the pages.

He also introduced a column devoted to local association activities, drawn from the reports of local secretaries and printed in the back of each issue, which often ran into six or eight pages in small type. This left much to the whim and writing ability of individual secretaries. Some favored brevity, simply listing the election of officers, time and place of meetings, the guest speakers and their topics, and current legislative and publicity campaigns. Others were more elaborate, offering long excerpts from speeches and detailed descriptions of social activities. The logic behind this column was central to the journal’s mission at the time: Keeping members informed about the activities of associations in other parts of the country to help them gauge their own progress in developing programs for running successful meetings, recruiting members, generating publicity and pursuing legislative goals. For the historian, these reports are more than a chronicle of activities, since many offer insight into the interests, mores and social habits of the time, along with a good deal of regional flavor.

After that first year, LAN had a subscription list of about 700. With promotional and complimentary mailings, Nathan Weed was sending out a total of 2,750 copies each month and the magazine was $300 in the hole. Meanwhile, Weed announced he had no interest in renewing his contract with NALU which would run out in the summer of 1908. In March 1908, the editorial committee, headed by Charles Jerome Edwards and including Clark, Plummer, Scovel and Wyman, agreed to guarantee the magazine’s appearance and its expenses personally until other arrangements could be made.

When the NALU convention met in Los Angeles the following August, the executive committee proposed raising membership dues to $2 with an automatic subscription included. Some objected to "the compulsory subscription idea," however, arguing that "the News ought to live on its own strength, if it is to live at all." Another delegate complained that the increase in dues "militated against securing new members." Ernest Clark, William Justice of Buffalo, William Scott of Philadelphia and a number of others rushed to the magazine’s defense.

"I will fight as hard for a dollar as anybody, if there is any principle involved. But it is simply the outlay of a dollar," Scott argued. "The men who have charge of it have devoted not only energy and time and talent, but they have devoted everything; they have given us their innermost thoughts, and I think we should appreciate it to the tune of one dollar a year for 12 copies. I am satisfied to renew my subscription." Sammis pointed out that it was "too perfectly absurd for consideration" to expect a new magazine to make money in such a short time. "You cannot buy white paper, you cannot pay for setting type, you cannot pay for printing, binding, mailing, editorial services and advertising soliciting without having some money," he declared.

Ernest Clark could hardly believe his ears, asserting that he regarded founding the journal as his greatest contribution to the association and to the insurance business. He never wavered from that view and kept up a keen interest in the magazine’s fortunes, even after serving as the national association’s president in 1913 and he continued to hold a seat on NALU’s publications committee until 1922.

After considerable discussion, the magazine’s supporters prevailed, and thus LAN became one of the perquisites for joining a life underwriters association. In the years following when the editorial scope widened and the journalistic quality improved, it became a major selling point for recruiting new members. "Worth the price of membership alone," is still many a membership chairman’s promotional slogan.

Having gained the approval of the associations for a dues increase, the executive council instructed Edwards (the only NALU president elected for two terms) and Frank McMullen of Rochester, a former NALU president and chairman of the finance committee, to find an editor. They decided on a young journalist, Everett M. Ensign, who began work on Nov. 1, 1908.

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