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November 2008
   VOICES FROM THE FIELD
The NALU's Extension of Activity During Edwards' year in office, the NALU was able to renew some of the projects it had been forced to set aside for the duration of the War. Always looking for ways to generate public interest in the value of life insurance, Association leaders found a helpful medium with the Young Men's Christian Association. January 19, 1920, marks the first official observance of "Life Insurance Day" as part of National Thrift Week, a publicity campaign sponsored by the YMCA. The NALU was asked to take full charge of the "Life Insurance Day" part of the program, cooperating with five thousand "Y" agencies to ensure that life insurance receive its full share of the publicity as a device for encouraging thrift. This laid the groundwork for subsequent life insurance Days and Weeks, which were to broaden into a nationwide life insurance celebration. Early in 1920, the National Association moved its offices to larger quarters. Beginning in March, readers of Life Association News were told to direct all future correspondence to the National Association's building at 25 W. 43rd Street in New York City. With the growth of the organization, the duties of Ensign and his staff had expanded enormously over the past fourteen years. From its twelve-page format of 1906, a typical issue of Life Association News ran into fifty or sixty pages. No longer limited primarily to Association business the magazine carried articles on selling techniques, reports and speeches from Association and industry meetings, industry and legislative news, inspirational pieces and a large section on the activities of various local associations. The national headquarters had also become a distribution center for a whole library of textbooks on agent education. The publication of Huebner's book was only the first of a number of works on the subject sponsored by the NALU. Especially popular was What Life Insurance Is and What It Does: A Primer for Laymen and Students, by William Alexander. Adopted by the U.S. Government as the text for the insurance course for military personnel in Europe and at home, it was also used for a similar program in Canada, called the "Khaki Library." A fundamental school textbook, companies and agencies, too found it a useful tool for training agents. Advertised as "the most convincing pamphlet which can be placed in the hands of a prospect," Charles Scovel's "Stability of Life Insurance: the Record, the Reasons" was also in demand. In addition, the NALU published at this time "The Manning System of Selling Life Insurance," a portfolio of practical sales suggestions by Earl Manning of Boston. Members of local associations could also purchase from the national headquarters large, elegantly printed copies of the Code of Ethics, membership cards, National Association emblem buttons and, of course, copies of the Proceedings of the NALU conventions. Ensign's title was changed from Corresponding Secretary to Executive Secretary, and he retained the position of editor and manager of Life Association News. Charles Jerome Edwards, chairman of the NALU committee on publications, reported that during the administrative year 1920-21 the publications department sold, wrapped and mailed 64,802 books and pamphlets. Receipts that year came to $19,231.12. Advertising income for Life Association News was $11,445.40. While all the material emanating form headquarters provided the agents with useful learning tools information and inspiration, Life Insurance: A Textbook remained the jewel in the crown of NALU publications. At $2.50 a copy, it was the standard textbook for life insurance, not only at the University of Pennsylvania where Dr. Huebner taught, but also at Johns Hopkins, Columbia and many other colleges and universities. It was the life insurance student's bible a the new institution, The School of Life insurance Salesmanship at Pittsburgh's Carnegie Institute of Technology. Opened for its first term in October 1919, this was Edward A. Woods' latest educational project. Having gained the sponsorship of the Association of Life Agency Officers, Woods had enlisted the cooperation of over a hundred American and Canadian companies to provide endowments as well as instructors for the new school. Limited to an enrollment of one hundred pre term, tuition, room and board was $250. Agents were given eleven weeks of intensive instruction in the fundamentals of insurance theory and practical salesmanship. The NALU launched another program of agent education in 1921 when a joint commission of National Association officials and the executives of the Young Men's Christian Association organized the Y.M.C.A. Schools' Standard Course in Life Underwriting. In five years, instruction was given to over 3,500 men in fifty-four cities of the United States and Canada. The 1920 NALU convention took place at Boston's Copley-Plaza Hotel in late September. In all, 1600 people attended. The principal speaker of the opening session was Governor Calvin Coolidge. Orville Thorp of Dallas was elected president of the national organization. The new vice presidents were: Jesse L. Scott of Detroit; William Goldman of Portland, Oregon; Florence E. Shaal of Boston; and O.B. Shortley of Toronto. Boston's Franklin W. Ganse Became Chairman of the National Executive committee. The choice of Mrs. Shaal as the NALU's first woman officer was an excellent one. (Her husband had been a life insurance agent.) In 1899 , the Equitable had given her a general agent's contract for Boston. This agency, in which all the subagents were women, had become one of the Equitable's most famous—and profitable. An ardent advocate of informed marketing and high ethical standard, Shaal had a long record as an indefatigable Association worker. Again, discussion of practical selling techniques dominated much of the program. Typical of the type of discussions which interested the attendees was the one on "underwriting American business," led by Allen D. Wallis of Philadelphia, a general agent for Equitable of Iowa and the father of ten children. Asserting that human life value is of greater consideration than property for the survival of many businesses, in his lengthy presentation Wallis focused on the uses of business insurance and ways of approaching prospective buyers. "If there is a failure in your community due to loss by death," He said, "then the responsibility for that loss rests upon you and the other life insurance men who should have seen it that the risk was covered. The life insurance men alone stand between America's business and such failures, and the responsibility is inescapable."[v] It was not only at national conventions, however, that the associated agents got together to discuss practical sales ideas and hear inspirational speeches. They were a popular time on the calendars of local association meetings as well. Since about 1916 the NALU had begun sponsoring regional "Sales Congresses." Eventually, these gatherings—along with legislative efforts—led to the formation of state life underwriters associations. Barnes observes that "while many states would not have been able to support conventions of their own at the time, they were enthusiastic in their support of the regional plan, and soon congresses were held in the Northwest, New England, Central States and Southeastern States, with other less comprehensive groups also holding meetings. The movement spread quickly, until the '20's it naturally evolved into the present system of state associations."[vi] Through a special program committee, the National Association provided detailed agenda for the conduct of these events, including specific topics and discussion outlines. These rallies featured prominent association leaders as well as outstanding sales people. At the beginning of 1921, NALU president Thorp and former president Charles W. Scovel announced an ambitious itinerary: a tour of sales congresses in fifty-two locations, starting at Dallas on January 6, and ending in New York City on March 21. This year also saw the NALU incorporated, a step that lent the organization more prestige and enabled it to conduct business with greater dispatch. (Incorporation also offered certain legal safeguards and protection for the officers and staff.) Since 1916 Ernest Clark and other Association leaders had been eager to gain a federal charter of incorporation for the NALU by an act of Congress. Because of the excessive war-time legislation and objections from some Congressional members, however, all efforts had been frustrated. Acting on the advice of their Washington attorneys, Clark and the other members of the special Committee of Incorporation decided to seek a more easily obtainable charter under the flexible laws of the District of Columbia. The charter was granted on August 5, 1921. Besides the six Washington residents required by law, the incorporators were Ernest J. Clark, Charles W. Scovel, Edward A. Woods, Jonathan K. Voshell, and Charles Jerome Edwards. The NALU's 32nd annual convention met at the Hotel Winton in Cleveland, September 5-7, 1921. Though less than the previous meeting, attendance was generally good. This is a little surprising since the convention was planned hastily, amid some confusion and uncertainty. At the Boston meeting the year before, no local association offered to host the next convention. At tone point, West Baden Springs, Indiana, was the site selected, but it became increasingly evident that such an expensive resort would discourage may from attending. Finally, Cleveland agreed to host the annual meeting. Choosing John L. Shuff of Cincinnati for president, the delegates again asked Shaal to stay on as vice president. John Henry Russell of Los Angeles, (John Newton Russell's son) became secretary. Treasurer Graham C. Wells was reelected, and Frank W. Ganse remained chairman of the National Executive Committee. Further changes in the constitution meant that the panel of officers hitherto known as the Executive Council became the Board of Trustees. It was composed of the current president, the chairman of the Executive Committee, the four most recent former presidents and the treasurer. Among other decisions made at the 1921 convention was one to raise national membership dues by $1. A drop in local membership and income became a major topic of discussion when the NALU Executive Committee met at the Astor in New York City on March 15, 1922. Chairman Franklin W. Ganse reported tat only $12,667 had been received in annual dues and that membership was continuing to drop. "Our total loss in membership at the time of the Cleveland Convention last year was 3,634 members," he told the group, "the membership having dropped from 17243 to 13609. If the ratio of loss throughout all associations continues consistently, our loss in membership this year will be approximately 3,000 members. If so this will bring our membership down to what it was in 1919."[vii] In an effort to enlarge local membership, the NALU Board of Trustees instituted a "National Association Day" designating May 11 as a day for every member of a local association to secure at least one application for membership. By August, at least for the occasion, the associated agents of North America displayed renewed enthusiasm for associations efforts. For three days the third international Convention of the Canadian and National Associations attracted a larger attendance than previous meetings of either organization. Despite a workers' strike which limited rail service in the United States, nearly 1,700 agents gathered at Toronto's elegant King Edward Hotel. Pointing to the ethical value of the association movement and the inspirational benefits of the annual conventions, The Weekly Underwriter commented:
The American agents elected Harvard graduated Dr. Adolph O. Eliason of St. Paul, Minnesota, as their new president. One of his first acts was to announce a member ship drive. Convinced that an earlier date would hive greater impetus to the push for more members, he designated January 15, 1923, as "National Association Day." Besides urging everyone to secure an additional member, he asked that loyal associations remit their annual dues by that date. Over 2,000 attended NALU's annual meeting in Chicago, in September 1923. Most congregated at the Drake Hotel for the social aspects of the convention and some of the group meetings, but business sessions were conducted a the Medinah Temple. Graham C. Wells of New York City was elected president of the national body. Practical sales problems again dominated much of the proceedings. At the morning sessions September 6, for example, when the topic was "Methods of Getting Prospects," to stimulate more audience participation, moderator Harvey Weeks help up a $10 bill which he offered to the one who contributed the best suggestion on how to get prospects. One of the volunteers was C.H. Cotton, of the Aetna Life in Buffalo. "I solicit largely among managers, assistant managers, and salesmen of stock and bond houses in Buffalo, and spend a good deal of time in trying to give them the very best service for their insurance." He said. "There are three things necessary in a prospect: he must have health, not have insurance, and have the money to buy it. Every one has the need, so we do not pay any attention to that, but strictly to people who have the money and the health. Through these stock and bond salesmen, and the services I try to render to them, I get a list of a great many men of considerable means who can be seen in regard to insurance and income for their families." Cotton won the applause of the audience, but we are not told who won the $10 bill.[viii] Since the annual conventions are the major events sponsored by the NALU each year, they serve as a barometer of the state of the Association. The reactions of visitors and delegates (often reflected in the insurance press coverage of the conventions) tell us much about the degree of importance the field force gave to the Association at any given point. Their opinions also revealed their expectations and interests. Divergent reactions reflected in the industry press inspired the editors of Life Association News to comment, "Convention good, bad or indifferent—take your choice." The Western Insurance Review, for instance, rhapsodized ,"So monstrously great in all respects was the 34th annual convention of the National Association of Life underwriters held in Chicago September 5th, 6th and 7th, that never will those who attended it cease in proclaim it the most tremendous triumph ever known in Life Insurance convention history." The Insurance Press, on the other hand, commented caustically that the Chicago meeting would be remembered "for what it was not—and ought to have been." Criticism ranged from the simplistic nature of the group discussions to poor acoustics in the hall:
One resolution endorsed by the delegates at this convention aroused considerable interest in industry circles. Inspired by the recently installed licensing boards in Pennsylvania, where Insurance Commissioner Thomas B. Donaldson had organized over twenty local boards of locally prominent agents to examine candidates for licensing, the resolution advocated the establishment of agent "advisory boards" in all states to set uniform standards for qualifying members of the field force. Oddly enough, it was the president of the Philadelphia Association who voiced opposition. Life Association News reported:
As the article implied, the proposal occasioned lengthy and heated discussion. Woodworth did not oppose the concept, but he did advise caution. Implying that perhaps the screening process wasn't all that effective, he told the members of the Executive Committee, "We have examined something over four hundred candidates for licenses in the City of Philadelphia, and this board, by its keen action, diligent to its office, has found cause for rejecting only two applications for a license. On one particular case the commissioner of the state wrote to the company and asked if, under these conditions, they wished that a license be issued; so what value did the board have in that particular instance?" Pointing out that only about four of the boards in Pennsylvania were controlled by the local life underwriters associations, he suggested waiting to see how the experiment in Pennsylvania worked out. Edward A. Woods had moved that the board give Woodworth a hearing over the strenuous objections of former NALU president Lawrence Priddy. Woodworth's caveat evoked only sarcasm form Priddy. "I am sorry that our friend took up his time with oratory and not with reason," he said. Lamenting the influence companies had over granting licenses to agents, Priddy candidly stated, "I had to do with the issuance of licenses and of giving the third degree to agents in New York for the past fifteen years, and I tell you, these home offices, all of them are absolutely careless about it…. The time has come when we ought to supervise it, and the superintendent of New York said to me recently he…would like to refer the application for a license to the Life Underwriters Association, and if…the Life Underwriters' board was opposed to it, he would oppose the license."[x] It was obvious that Woodworth had wasted his time. Even Frank Buser, his colleague form Philadelphia, did not agree with him. Having heard the glowing reports of William Furey about how beautifully the advisory board worked in Pittsburgh, they were sold. "It is working like a charm," he said. "The best proof of the importance of this wok is the fact that a week before last we had a smaller number than usual appear, I think it was twelve, and out of the twelve we recommended three and held over nine…." Initially, at least, the resolution met with general approval. Trade journals carried articles favoring the plan. The editor of The Insurance Press, for example, noted that the learned professions—law, medicine and theology—had similar mechanisms for qualifying candidates. The concept, he said, "had sound precedent in other vocations where knowledge, character and conduct of an individual reflect favorably of unfavorably upon a collective profession." Graham C. Wells of New York City was elected president of the national body forth 1923-1924 association year. He devoted a good deal of his year in office to putting the national organization on a sound financial footing. Summarizing his administration, at the 35th annual convention in Los Angeles, he expressed gratitude to the general agents and managers who raised money for a special fund to help the national organization out of its financial troubles. Particularly generous had been the general agents and managers of New York City who had contributed $1,400, and those at Philadelphia, who had given $1,330.[*] By the decade of the twenties, it was becoming increasingly obvious that serving as NALU president was a very demanding job. Often it involved considerable financial sacrifice. This was especially true in cases such as that of fifty-one-year-old John William Clegg of Philadelphia who was elected president for 1924-25 at Los Angeles. Called a "one-company man," he had spent all his business life with the Penn Mutual where his term of service began in 1891. One of the largest personal producers in the country, Clegg had been very active in the Philadelphia Association of Life Underwriters, as well as civic and church affairs. A member of the Union League, the Philadelphia Country Club and the Chamber of commerce, he was manager of the American Baptist Publication Society, and also belonged to the American Academy of Political and Social Science and the English Speaking Union. "I expected to come here to have a quiet, inspirational, instructive séance," Clegg told the members a the closing banquet, "but it has been interrupted. I don't know why…they picked on men. I spent a very restless night after being informed that they wanted me to serve this coming year as your president. I believe that we all should be willing to lay aside our own convenience if the call comes to render service." Asking for the members' full cooperation during the coming year, Clegg said, "We are only your servants, and in the contemplation of this call I realize the price that I must pay. I hope for, and I am sure that you men and women will lend us, your best thought; will lend us your cooperation, will lend us your sympathies; and in that you will be helping us to render a greater service to you an through you to our whole nation."[xi] Charles Dobbs, managing editor of Insurance Field, complimented the NALU on its choice of new officers, as well as its management of the convention. Praising Clegg for his commitment, he wrote:
Dobbs attributed the success of the convention to two features in particular: Dr. Solomon Huebner's keynote address and the "perfect flood of contributions of authentic cases to illustrate the value of Life Insurance in the creation and preservation of estates." Huebner, with characteristic evangelical fervor, had expounded the thesis of needs selling based on human life value. Offering a number of practical applications of the concept, Huebner impressed the agents again as someone who—far from being a vague visionary or dispassionate pedant—fervently believed in the nobility of their calling and understood the techniques of effective salesmanship. Asserting that Huebner had presented "the most comprehensive and closely reasoned picture of the probable future course of Life Insurance that anyone has yet formulated," Dobbs commented:
The practical sales seminars at this convention focused on sharing success stories and demonstrating various methods. Applauding the use of authentic cases to demonstrate selling strategies, Dobbs concluded his review of the convention with an endorsement of the Association's new leaders. They were notable, he pointed out, not only because the president was a "rate book man," but also because the three vice presidents were all young men of remarkable promise. Those elected were: George E. Lackey, Oklahoma general agent for the Massachusetts Mutual Life; John Henry Russell, associate manager of the home office agency of the Pacific Mutual Life; and Paul F. Clark, home office general agent at Boston of the John Hancock Mutual Life. Raising professional standards and legislative vigilance provided the focus for much of Clegg's activities that year. On October, 24 he was the principal speaker at an association meeting of the agents in Atlanta. "The future strength of the National Association," he told the group, "lies in its educational program." He stressed the importance of agency qualifications laws, explaining the operation of the law in Pennsylvania, where it was backed up by advisory boards. About the Maryland law, recently passed through the instrumentality of the Baltimore Association, he said it was 'one of the finest in the country." He predicted that eventually agents would not only need a through knowledge of insurance, but also "a collegiate course would be necessary before a man or woman could enter the profession because knowledge of psychology, finance and business practice is essential to successful life underwriting." Clegg also mentioned the political influence of organized life underwriters. "Nobody of men in the United states could be called together for service so quickly as the life insurance agents," he declared, "particularly the industrial agents, who were the men best qualified to sell the Government's bonds and stamps during the war and to carry their country's message into the homes of the American people."[xiii] At the beginning of the new year Clegg announced the appointment of William A. Searle as "Traveling Assistant to the National President." Searle, who would serve as liaison between headquarters and the local associations, had considerable background in organizational work, primarily with the Chamber of Commerce. "The close supervision which must be given to the vast amount of work that is constantly going through the National Association headquarters in New York City," it was explained, "makes it impossible for the Executive Secretary, Everett M. Ensign, to devote much time traveling, and still it was felt that his work as a secretary would be greatly helped by someone who could make personal contacts, representing the National and, as the same time, help the locals with any problems they had." The national organization's magazine pointed out that previous NALU presidents had often expressed a need for such a person and when Clegg met with his new trustees after the Los Angeles convention it was practically decided "the man must and could be found." For the time being, Searle was to be based at Philadelphia with Clegg at the Penn Mutual Building. The life underwriter fraternity mourned the sudden death of one of its pioneers, Charles Jerome Edwards, the only NALU president to serve two terms, who died unexpectedly on January 24, 1925. Noting that Edwards had "fought vigorously" to establish Life Association News and contributed heavily to help finance the project, the editors of the magazine suggested, "perhaps his most notable and brilliant efforts in behalf of the cause of life insurance were during the Armstrong investigation. Through the work of Mr. Edwards and a few others a scale of commissions was eventually adopted which made it possible for a life underwriter to consider his profession as a fairly profitable occupation."[xiv] Early in 1925 Clegg sparked a minor controversy in industry circles when he proposed that no new form of policy be issued by any company until it had been agreed upon as desirable for the better service of the public. Then all the companies, he said, ought to adopt and issue it simultaneously. According to Life Association News, some considered this "a backward step":
As Clegg's administration drew to a close, there were 160 local associations in the NALU—a gain of six over 1924. Seventy-seven associations during the year reported gains in membership; 84 exhibited losses, including the seven that had disbanded. The largest numerical gain was made by the Seattle Association with an increase of 250 members. Kansas City followed with a gain of 210. New York City remained the largest with 1,423 members. Membership of all associations combined came to 13,490. In his report at the national convention that fall in Kansas City, Clegg told the delegates that his term of office constituted fourteen months of the most pleasant work he had ever assumed. He appealed for a higher mental development in the individual and "for the strengthening of the bond which binds us together" so that legal reserve life insurance might reach the highest standard of human development. Most of the work accomplished by the national organization, he said, "has been done quietly but effectively by those to whom it was entrusted." The United States Review summarized Clegg's administration with a glowing encomium:
Kansas City's Muehlebach Hotelk served as headquarters for the NALU's 36th annual convention. Sessions were held next door in the Orpheum Theatre, described as "a play house comfortably seating some 2300 people and well-adapted to the occasion." Among the resolutions passed at this convention was one calling for an institutional exhibit of legal reserve life insurance to be installed a the Sesquicentennial Exposition in Philadelphia. A joint committee composed of representatives form the Association of Life insurance Presidents, the American life Convention and the NALU would oversee the project. It was a chance to visit the Exposition that probably swayed some of the delegates to choose nearby Atlantic City as the site of the next NALU convention. Plans also called for making this another "International convention," held jointly with the Canadian Association of Life Underwriters. The closing banquet took place in the Pompeian room of the Biltmore Hotel. The principal speaker of the evening was Henry J. Allen, a former governor of Kansas who had been prominent in the public eye because of his fight for the establishment of an industrial Court and his vigorous opposition to the Ku Klux Klan. His topic was "Life Insurance and the Average Man." Declaring that life insurance had done more than any other influence to bring into the American consciousness a sense of responsibility for the future, he told the audience "the development of the income insurance idea" was making the United States more stable than it was thought it ever could be. "Governor Allen stopped speaking at 11:30," the report concluded. "Then the floor was cleared and the reminder of the evening was given up to dancing." Reviewing the convention on the October 9 issue, Clarence Axman, editor of The Eastern Underwriter, commented on the choice of officers:
Foreword by Alan Press, 1988-1989 NALU President Preface by Jack E. Bobo, 1989 NALU Executive Vice President 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 Chapter 3 The NALU's Extension of Activity The Agents Move for Recognition Chapter 4 Annual Conventions and Midyear Meetings The NALU Celebrates Its 50th Anniversary Chapter 5 The NALU Joins the Industry in Legislative Battles The NALU Establishes the National Quality Award Chapter 6 Controversies and Schisms (1946-1956) Chapter 7 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 The NALU Issues Statements on AIDS The NALU Combats a New Wave of Attacks The NALU Celebrates a Century of Service * This points up the fact that by the early 1920s, special units of general agents and managers had formed within the structure of the larger life underwriters associations. [v] Proceedings, 1920, pp. 35-42 [vi] Op. Cit., pp. 25-26 [vii] LAN, April 1922, p. 510 [viii] Proceedings, 1923, ppp 165 ff [ix] LAN, October 1923, p. 178 [x] Proceedings, 1923, pp. 409-410 [xi] LAN, August 1924, pp. 933-935 [xii] LAN, September 1924, pp. 22-23 [xiii] LAN, December 1924, p. 264 [xiv] LAN, February 1925, pp. 390-391 [xv] Ibid., p. 404 [xvi] LAN, November 1925, p. 270 © Advisor Today 2008. All rights reserved.
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