This is a story of people who share an occupation. They have all been involved in marketing life insurance in one way or another. Most of them deal directly and personally with the consumer. They are life underwriters, or life insurance agents: the people who generate the initial income for America’s $600 billion life insurance industry. Through their efforts millions know peace of mind and economic security. Whatever else they may have in common, it is this shared business interest that brings them together.*

This binding influence provided the initial impulse to form a society of fellow practitioners. Formally organized at a meeting in Boston, in 1890, as the National Association of Life Underwriters (NALU), its purpose was to “advance the cause of true life insurance.” The founding members sought to improve conditions of life insurance workers in the fields. By coordinating their efforts, they hoped to promote a high level of competence and to introduce standards of ethical conduct among agents. The realized, of course, that a better appreciation of legal reserve life insurance and its uses among the general public was essential to the success of their program. These considerations sustained the group in its formative stages and enabled it to develop into a highly coordinated organization of professionals assuming a major role in the life insurance business.

The NALU is essentially a federation of local associations, each directly affiliated with the National Association. There are some 950 of these associations throughout the United States, ranging in size from25 members to over 2500. Associations are also active in Puerto Rico, the Virgin Islands, Guam and the District of Columbia. There is even an association in Europe, primarily for agents who serve Americans living abroad. In addition, there are state associations that coordinate much of the activity of the local associations within their respective states. The combined membership of these associations is about 140,000. Employing a permanent staff at its Washington, D.C. headquarters, the national organization occupies a significant place in the business and political life of America.

The National Association also maintains cordial ties with similar organizations in other countries, especially in the other English-speaking countries. Ties with the Life Underwriters Association of Canada are traditionally close. In fact, Canadian associations were once part of the NALU. (The Canadian agents, having formed a national association in 1906, began functioning independently in 1916. The president of the NALU automatically becomes the honorary vice president of the Canadian association, and the president of the Canadian association serves the NALU in a like capacity.)

The NALU is governed by a board of seventeen officers, including twelve trustees, who serve for terms of two years and a president who serves a one-year term. Delegates representing the membership elect these officers at an annual convention. Day to day management of the Association is under the direction of a permanent executive vice president.

This book traces the development of the organization form its regional and tentative origins in the 19th century to its present position of national prominence—a span of over 100 years. Though not a slave to dates, the arrangement is broadly chronological. Focus is on the leading personalities of the day and incidents of major consequence. Often these fall naturally within a particular decade of historical period. As a number of chapter headings suggest, however, a major topic may be treated fully, even if it means disturbing the general chronological plan.

In compiling material for this work, the aim has been to single out the most significant and interesting details of the Association’s first 100 years. The NALU has had its dramatic moments, with leading players worthy of the parts, too. All this is unabashedly recorded. Still, the mundane and human elements are not overlooked, by any means. Many who left permanent ims on the Association were very much individualists. Some were eccentrics. People like that aren’t always terribly conventional—even on public occasions.

It would be less than candid to pretend that the history of the NALU’s leadership has at times found itself hopelessly overwhelmed by the course of events. Initiatives were lost, and much of the Association’s activity was more reaction than action. These reversals and foibles are also part of our story.

Occasional allusions to major trends and events punctuating our nation’s social and political past are unavoidable. To be understood justly, a position of an action must be viewed in the context of the times. It is impossible to deal with the plight of life underwriters at any period without some reference to national, and even global, events, especially economic conditions affecting the insurance industry.

In its century of progress, the NALU has pursued its goals with a steady, often plodding, persistence. But there have been days of crisis when it acted swiftly and dramatically. Unavoidably, there have been conflicts and intrigues. Some scenes were played out in meeting rooms, some in courtrooms, others in legislative halls and executive offices, and some in rooms. Wherever the action took place, improving the underwriter’s position remained the paramount consideration.

The life insurance agent has been an integral part of the American scene for five generations. His progress is as much a part of the American experience as the automobile and the ice cream cone. So is the Association movement. The development of the NALU represents an important aspect of this movement. It is one of the oldest and largest organizations of its kind in the world. Professional and trade associations exhibit a ubiquitous presence in American life today. Because of them, jobs of dubious status and security have become respected careers. It is hard to work in a profession or industry in this county and remain untouched by some such organization, especially in the “white-collar’ echelon.

Besides playing a leading part in the association movement, this organization had considerable impact on the professionalizing trend that led to the improved quality and status of practitioners in many fields. During the 20the century we have seen “mere trades” become respected professions with licensing requirements, courses of study and academically recognized credentials. The National Association of Life Underwriters pioneered this concept, providing the great thrust that led to the establishment of the Chartered Life Underwriter (CLU) designation as well as other educational programs. For this reason the NALU story occupies a place in educational history as well as in the history of business and commerce.

Like other large associations, the NALU exercises considerable political influence, not only as a lobby at the federal level, but also in the state capitals. To a large extent, its political activity is motivated by an eagerness to ensure the integrity of the marketplace so that qualified agents can work in an environment of fair competition where ethical business practices prevail. In the various states, the NALU’s contributions to established regulatory and licensing standards for the insurance industry are major and longstanding.

Although it typifies the association movement in many respects, there remains much about the NALU that is unique, or at leas not typical. Many associations and professional societies originated on university campuses. Medical and legal societies, for instance, were essentially professorial in inspiration. Some began as purely social clubs, or grew out of confrontation s with employers. The NALU began in none of these ways, and the course it pursued doesn’t quite parallel those worked out by most other trade and professional associations.

It should be remembered that the impulse to build a great organization is not always inspired by ambitious strategies for clearly defined goals. Both initially and through the years, many who occupied positions of influence in the NALU began with a simple desire to mingle with their fellow workers; to share ideas, enjoy one another’s company and, sometimes, to defend themselves against a perceived opposition. This is an aspect of guilds, unions, professional associations and learned societies that cannot be dismissed.

Confining the pages of this book to a series of “great moments’ would be a serous distortion. It would overlook the mass of the Association’s adherents. Members have derived numerous benefits form their involvement in life underwriters associations through the years, but many will tell you that the NALU’s greatest gift to them was the warmth, friendship and loyalty they found there.

The thousands, known only within their own circles, who never achieved great prominence in their association are as much a part of this story as those whose names appear on its pages. Yet these thousands are present on every page because without their perennial enthusiasm and support, there would be no history to write.

Foreword by Alan Press, 1988-1989 NALU President

Preface by Jack E. Bobo, 1989 NALU Executive Vice President

Introduction

Acknowledgements

Chapter 1

Laying the Foundation—A Meeting at the Parker House

Leading Figures—Ransom, Carpenter, Blodgett and Plummer

Conditions Leading to the Foundation of the NALU

Rise of Modern Life Insurance and the General Agency System

Issues and Accomplishments of the First 15 Years

Chapter 2

In the Wake of the Armstrong Investigation

A Royal Commission Investigates Life Insurance Operations in Canada

A Period of Growth and Visibility for the NALU Under Strong Leadership

The NALU Plays a Leading Role in Insurance Education

The NALU During World War I

Chapter 3

The Post-War Decade

The NALU's Extension of Activity

The Agents Move for Recognition

Chapter 4

The Depression and Aftermath

Annual Conventions and Midyear Meetings

The NALU Celebrates Its 50th Anniversary

Chapter 5

The Agents Earn Their Wings

World War II

The NALU Joins the Industry in Legislative Battles

The NALU Establishes the National Quality Award

Chapter 6

Controversies and Schisms (1946-1956)

The Foundation of LUTC

The Nola Patterson Affair

GAMC Formally Organized

Chapter 7

The NALU Goes to Washington

Dispute Over Minimum Deposit Insurance Plans

GAMC Stages First LAMP Meeting

The NALU Celebrates Its Diamond Jubilee Year

The NALU Increases Political Activity

U.S. Senate Antitrust and Monopoly Subcommittee Investigate Life Insurance

The NALU Responds to Consumerist Activism

Chapter 8

The NALU Reaches the Century Mark

FTC Releases a Study Critical of the Insurance Industry

Formation of the Women Life Underwriters Conference

Drop in Local Membership

The NALU Issues Statements on AIDS

The NALU Combats a New Wave of Attacks

The NALU Celebrates a Century of Service

Open Book

Book Marks

Top     LEGAL NOTICES     Contact Webmaster    

Change/Renew NAIFA Membership     Get Advisor Today: Join NAIFA

© Advisor Today 2003. All Rights Reserved.