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September 2008
   VOICES FROM THE FIELD
The NALU Increases Political Activity Proximity to the center of national political life had been one of the reasons for locating the NALU's headquarters in Washington. The board meetings there during January—the time when Congress convenes every year—offered an irresistible opportunity for the NALU officers, their spouses and members of the legal staff to entertain members of Congress and other government officials. It was a good opportunity for the agents' representatives and government leaders to mingle informally, to become acquainted with one another and share their views. As anyone familiar with the political scene in Washington knows, such social gatherings are indispensable if one hopes to exercise any influence at all. Arranged by Dunaway and presided over by Smith and his wife, the NALU began giving small dinner parties and informal receptions on other occasions, too. Later, these get-acquainted evenings proved particularly fruitful during leadership orientation conferences. For larger turnouts, a hotel or private club was used, but very often Dunaway held informal receptions at 1922 F Street. The boardroom at NALU headquarters soon became a familiar gathering spot for recently elected minority leader in the House Gerald Ford from Michigan, Senator Sam Ervin of North Carolina, Kansas Senator Robert Dole, Senator Thomas Eagleton of Missouri and numerous other Congressional leaders. In 1967 for instance the January board reception drew ninety-nine senators and representatives. In August 1966 the NALU announced the formation of a "Voluntary, bipartisan Life Underwriters Political Action Committee (LUPAC)…to provide a vehicle for encouraging increased political awareness and participation among those in the life insurance business and other interested persons." Emphasizing that the new organization was unincorporated, nonprofit and not affiliated with any political party, Life Association News explained:
Of all the officers, perhaps King was the most experienced. "King was very knowledgeable," Carney smith recalled. "He had been finance chairman for Terry Sanford when he ran for governor of North Carolina, and he was very friendly with both [Senator] Sam Ervin and Senator Everett Jordan. Without King to sell the idea to the board, we may not have been able to form LUPAC at that time."[xxx] The new organization set up national headquarters on Capitol Hill at 53 D Street, S.E., the offices of experienced Washington lobbyist Roy Pfautch who became its executive director. The first step was to issue invitations to all members of local associations to become Founder Members by making an initial contribution of $1,000, or Charter Members by giving $100. (There were also categories for those contributing smaller sums.) In making his appeal for contributions Bowlus admonished the agents, "Only positive, citizen-level action in support of congressional candidates committed to private enterprise can maintain the balance of representative government which has made America great. As a leader in life insurance, you have contributed much to our free economy. Now we ask you to join in support of candidates for congress who will preserve our American way of life." Although a number of so-called special interest groups were forming political committees (PAC's) at this time, the agents' entry into the arena by not means received universal applause. The innovation was looked upon by many as alien to American politics and incompatible with traditional democratic ideas. "Many of us at the time LUPAC was formed felt that it wasn't appropriate for life underwriters to get into politics," former NALU president David Fluegelman recalls. "That was a different business. What we wanted to do individually was our privilege, but we shouldn't be part of it. I was one of those. I was gradually swung over. You rarely hear of anybody opposed in principle to LUPAC today, because everyone has learned the importance of having contacts with the legislature."[xxxi] And there were those who too easily surmised that LUPAC would not be all that bipartisan, and much of the criticism implied that money would most often go to conservative politicians, primarily members of the Republican party. The circulated brochure explaining the organization's aims to work "in support of those principles and philosophies essential to preservation of the competitive, private enterprise system," confirmed the impression. In a letter to Sam Gaglio, editor of Life Association News, Jack Hunter of Garden City, New York, wrote:
Much of the criticism stemmed from nothing more than misapprehensions and a failure to understand the nature and function of the new PAC. To assuage any fears about the legalities of LUPAC, assistant general counsel Pattison explained in his column, " On the Legal Side," that under the Federal Corrupt Practice Act and the Hatch Act (which regulate political contributions and expenditures) the plan was perfectly acceptable. The chief element, he pointed out, was that LUPAC was an unincorporated committee and "a self-governing, independent, nonprofit and autonomous organization," entirely separate from the NALU. "Such a committee is recognized by the Federal Corrupt Practice Act as a lawful vehicle though which individuals may have the opportunity to contribute to political campaigns," he noted. "LUPAC, is not a lobbying organization," he explained. "It will not seek to influence directly of indirectly, the passage or defeat of any particular legislation. Legislative activities on behalf of life under writers will continue to be performed by NALU." Outlying the exact relationship between the NALU and LUPAC, Pattison explained:
Predictably the foundation of LUPAC made Washington much more aware of the NALU's presence. Looking back on its tremulous origins, Carney Smith recalled, "That first year we only raised a total of about $22,00. And we had lots of opposition, primarily form New York city. Ahalsey Josephson, editor of Probe, did not like it, and was blasting us all over the place. Bu at our January reception about a hundred members of Congress showed up! That demonstrated the power of LUPAC." Not surprisingly, the theme dominating the 77th annual convention in New Orleans was "Greater involvement in public affairs by life underwriters." Despite serious problems on the legislative front, the life insurance business was nevertheless enjoining an encouraging period of growth. Total life premiums for the U.S. during 1966 reached $15.776 billion. The combined total for life and property insurance premiums was $49 billion, an increase of $4.818 billion over 1965. The number of companies continued to grow during this period, as well. By the end of the decade there were 1,761 legal reserve life insurance companies operating in the United States. all but 156 of these were stockholder-owned, but the generally older and larger mutual companies still accounted for over half the insurance in force. The growth was naturally reflected in the size of the agency field force, and particularly in the number of career agents involved in association activity. That year the combined membership in local associations came to 103,000. Lewis C. Yount, manager for Prudential in Seattle, became president of the NALU for the 1966-67 year. An eighteen-year veteran in the business, Yount had been active in Association work and his agency was among the very top of Prudential's for productivity. This soft-spoken, silver-haired graduate of the U. S. Navy School of Music was an accomplished clarinetist and an avid golfer. It was because of his influence in Prudential's management circles that Carney Smith had encouraged Yount to run for office several years before. Smith rightly assumed that Yount's presidency would prove beneficial for Association membership. Delegates a the New Orleans convention voted unanimously for an increase in dues, which meant the amount going to central headquarters after the new year would be $10 per local member. Pointing to the increased services the Association was providing, NALU treasurer Thomas R. Buchanan reminded the delegates, "All of these things will require additional personnel, and this in turn will cost more money. As Winston Churchill said, 'give us the tools and we will do the job.' "The NALU's budget for that year was approximately $1.2 million; the organization was operating in the black. Progress in the construction of the new wing at 1922 F Street, however, had been disappointing. "This particular project has turned out to be the most frustrating in my entire business career," Smith told the delegates at New Orleans. "What with zoning restrictions, the Fine Arts Committee, strikes, and problems with the general contractor, up to now we have been twelve months trying to complete a seven months' job, and we are still not fished." By the end of the year all these difficulties were swept away and the headquarters staff was settled into the new wing before the Christmas holidays. Dedication ceremonies took place during the January board meeting. Among other improvements afforded by the additional space was an office for the presidents of the NALU. Named the John Newton Russell Memorial Room, the office was furnished by Pacific Mutual which also contributed a large portrait in oils of the former NALU president. In March 1967, Carlyle Dunaway resigned as general counsel of the NALU to join the United States Information Agency as an assistant general counsel. A brilliant lawyer, Dunaway was a strikingly handsome man with a great deal of charm. Association officers for years had enjoyed his droll wit as much as they had relied upon his acute legal mind for sound advice. His departure was probably inevitable. Smith found Dunaway's relaxed approach to working hours and the mechanical routine of business increasingly irritating. Smith was an autocrat; Dunaway liked his independence. The final breach was undoubtedly a relief to both. On April 1, Douds became general counsel for the NALU. By this time The American College of Life Underwriters was holding CLU conferment in addition to the one at the NALU annual meeting. In 1966 a record graduating class of 1582 Chartered Life Underwriters had persuaded the American Society to hold its 39th national CLU conferment dinner in Boston on September 8 during a two-and-a-half day meeting and forum. The second conferment exercises took place during the NALU convention in New Orleans and the third in San Francisco on October 13. By the end of the decade, the practice of giving out CLU diplomas at large conferment dinners, holding business meetings of the American College of Life Underwriters or the American Society of Chartered Life Underwriters during NALU conventions had ceased altogether. By 1970, all that remained as a reminder of former ties was the American Society's "CLU Breakfast." Francis G. Bray, a graduate of Washington University in St. Louis and an agent for American General in Houston, was named president of the NALU at the 1967 convention which met in September in Atlantic City. As a young officer in World War II he had led the first wave of troops that touched shore at Omaha Beach on the morning of June 6, 1944. "He was pinned down by German machine gun fire for 18 hours, "Woodson , a close friend and associate of Bray's relates. "They had to wait until dark, then take their chances climbing up zig-zag to attack the enemy's fortifications." Trained in the law he had, nevertheless, been in the life insurance business for thirty-seven years, was a Life member of the MDRT and six-time qualifier for the National Quality Award. "Morally and intellectually strong, he has the ability to dominate without irritating," says Woodson. "And he just was a good president at a time he was needed." The 1967 convention created another NALU-sponsored organization. Affiliated much in the ways as GAMC, the Association for Advanced Life Underwriting (AALU) became a conference of the NALU. The group was already ten years old, and the proposal to make it an affiliate of the national organization had been under discussion for several years. Composed of some of the country's leading agents, the organization had it origins in the much-disputed "bank loan plan," or minimum deposit plans, that had flared up a divisive issue a the 1958 midyear meeting in Birmingham. The controversy was reminiscent of one over variable annuities (still raging in some quarters). The dominant faction in Associate circles objected strenuously to the practice of urging clients to purchase insurance by withdrawing funds form the cash value build-up in a whole life policy or with borrowed money generally. In effect, this could reduce the value of a whole life policy so that it provided no more benefits than term insurance, they argued. Like variable annuities, such schemes represented a departure from traditional permanent insurance. This they could not countenance. As a result, those agents interested in promoting minimum deposit plans separated from the NALU and formed their own organization. Since its members had returned to the fold, C. Carney Smith arranged for the AALU to have an office at NALU headquarters. The group was already influential politically. Focusing primarily on federal legislation affecting employee benefits and taxation, the organization's annual spring meeting n Washington attracted leading members of Congress and the administration. Membership was limited to "those underwriters who engage in advanced underwriting work." At the time there were 348 members. James Poole was president. Their meeting with top government officials and leaders of the life insurance industry in Washington on March 12, 1968, was actually their eleventh annual meeting, even though it was their first as a conference for the National Association of Life Underwriters. John O. Todd of Northwestern Life in Evanston, Illinois, gave a brief history of AALU in its first decade explaining that it began as a protest group. He said he wished that other protest groups could be as successful in doing something "for the people instead of just to the people." In becoming a conference of the NALU, he told the members, it had created a tremendous opportunity to serve policyowners, agents and the life insurance business in general. "The agent," said Todd, "who serves what we call, for want of a better name, 'the advanced area,' can bring to NALU the kind of leadership activities it needs."[xxxiv] In July 1968, Madelyn A. Guilian became executive secretary of the Association for Advanced Life Underwriting. A native of Birmingham, Alabama, Guilian was educated at Auburn University and the University of Alabama. Prior to joining AALU she had been working in Washington for the American Mining Congress and Congressman George Huddleston, Jr. Her familiarity with the Washington political scene, along with her quiet charm, a wonderful capacity for coping with detail and her unfailing discretion, enabled her to serve the organization long and well. In 1972 Guilian was named executive director. Owing to failing health, she retired in July 1987 when she was succeeded by David Stertzer, former NALU executive assistant. The end of 1967 saw the passage of a new Social Security bill giving a 13 percent increase in benefits. During preliminary hearings, the NALU and other industry groups had waged a relentless legislative campaign to limit many of the controversial and costly amendments proposed. "The increases in tax rates and benefits were not as great as those desired by the administration," Life Association News commented. "Through the work of organizations like NALU, the American people are beginning to learn that Social Security is not the bargain they imagine it is. They are learning that Social Security not only bites off a big chunk from their annual earning, but it also undermines private insurance."[xxxv] The 1968 Republican Party Platform endorsed the NALU's plan to encourage private funding of higher education by allowing parents to set aside tax deductible funds in insurance contracts or other funding media to pay future tuition. "GOP adoption of the plank followed an historic first appearance before a national political convention by NALU president Francis G. Bray," NALU attorney David Pattison reported. "A similar presentation was made to the Democratic Platform Committee in August," he said. As a result the committee added a plank in the platform providing that the Republican Party would "continue to favor tax credits for those burdened with the costs of higher education, and also tax deductions to encourage savings for this purpose." Life Association News reported, "Syndicated columnists Robert S. Allen and John A. Goldsmith recently credited NALU with adding a 'sleeper' to the 1968 Republican Platform. An August 12 column listed 'a new plan, advanced by the National Association of Life Underwriters which would let partners set aside an annual amount, tax-free, for future college costs as one of the sleepers that could give the platform 'new meaning in this campaign year.'"[xxxvi] The NALU convention, held in San Francisco during the week September 15, 1968, attracted national attention by having Vice Presidential candidate Edmund .Muskie of Maine as a principal speaker. Another well-known figure sharing the platform was Paul Laxalt, the governor of Nevada. Both discussed "Campaign '68—the Personalities and Issues of the 1968 Presidential Election." Calling for national unity, Muskie said, "Some Americans appear to want a change in government because they are anxious about their own security, racial tensions, crowded cities, pollution, crime and the increasing restlessness of youth." This had led, Muskie believed , to riots, demonstrations and the emergence of George C. Wallace, former Alabama governor and the presidential candidate on the American Independent Party ticket. "Wallace," Muskie said, "threatens the very foundations of our society." While the Vietnam war, social unrest and racial strife created tension for the nation, the NALU found itself dealing with a constitutional crisis and a rebellious state association. In what became known in Association circles as "the Don Burns case." The delegates in San Francisco debated for more than ninety minutes on Thursday morning, September 19, on the amendment proposed by the California Association that would give the power to suspend or revoke a state local association's membership in the NALU to the National Council instead of the Board of Trustees. The amendment was ultimately defeated by a vote of 635 to 80. The debate reflected a yearlong dispute between California and NALU officials. At the center of the storm was Donald C. Burns, executive vice president of the California Association, a lawyer who also served as legislative counsel for the organization. It began when the NALU asked the California Association to change its annual convention date so it would not comes so close to the NALU annual meeting in San Francisco and possibly decrease attendance. Leaders in the California Association discounted that possibility and refused to accommodate the NALU. The NALU board then voted to suspend the California Association, as of April 1, but relented when a compromise was finally worked out. Addressing the convention Daniel J. Bennett, president of the California Association, attempted to explain their position, Life Association News reported:
Jerome Kishnick, president of the San Francisco Association, spoke against the amendment contending the proposal did not reflect the feeling of most California members. Morland McManigal, former president of the California Association did not agree. No local association in California, he declared, voted against the amendment. Three votes were taken on this issue he said and all the associations favored it as well as the entire Executive Committee of the California Association. A counter proposal offered by the NALU Board of Trustees that no association be allowed to hold a major meeting within thirty days of an NALU convention was also defeated—by a very narrow margin. As usual at NALU conventions not all the time in San Francisco was devoted to ironing out difficulties and debating national political issues. There was plenty of social life and lots of time given to inspirational sales talks and practical selling techniques. A symposium on "The Present and Future of the Agent" featured Earl Clark, president of Occidental Life; Charles T. Clayton, executive vice president of Liberty National; Norman G. Levine, general agent for Aetna in New York City; and Jack B. Turner, agent for Provident Life in Clarksville, Tennessee. Marketing tactics were also the focus of the GAMC Management Program, the MDRT Hour and the women Leaders round Table Sellarama. Discussing the role of "The Life Insurance Agent in a Changing World" at the women agents' meeting were Fay Baziri Campbell, Reserve Life general agent in Washington, DC; Margaret Whelpley, Connecticut Mutual agent in Portland, Maine; and Elaine Loucks, with the Investors Syndicate Life in White Bear Lake, Minnesota. "If anyone asks what kept me in the life insurance business, I can answer in two words—positive thinking," Campbell told the agents. "If anyone asks me how I can run an agency and be a personal producer at the same time I can also answer in two words—time control." Dudley Dowell president of New York Life, was the principal speaker at the traditional WLRT dinner on the evening of September 15. President of the 427 woman agents' organization that year was Mary E.L. Cassedy, an agent with the New York Life in Kalispell, Montana. The delegates chose Roy D. Simon to serve as president of the national organization. A thirty-one-year veteran in the business, Simon was an agent for Penn Mutual Life in Chicago. He was regarded as a good representative of the upper quality personal producing agent. Fortunately this was a comparatively uneventful year for the NALU. In June, Simon suffered a heart attack while playing tennis with a friend. Consequently, he was unable to take an active part in association affairs for much of the remainder of his term. On January 8, 1969, Julian Myrick died; he was eighty-eight, "Our nation has lost a most distinguished citizen," C. Carney Smith wrote to the members of the board and past presidents, "and we of NALU rightfully mourn a great leader, wise counselor, and devoted friend." This year marked the twenty-fifth anniversary of the National Quality Award, the oldest distinction available to career agents through the national recognition program. Since 1960 the industry had been offering the Health Insurance Persistency Award to promote and recognize quality business in the health insurance field. In 1969 the NALU and the International Association of Health Underwriters began co-sponsoring the Health Insurance Quality Award. Based on a thirteen –month policy persistency, eligibility depended on an agent's belonging to one of these organizations and being engaged in selling coverage for disability income, hospital, surgical, major medical expenses, and similar types of insurance. The NALU held its 80th convention in Houston where freshman Congressman George Bush of Texas stood in for Gerald Ford who was detained by the funeral of senator Everett M. Dirksen in Washington. Bush devoted most of his speech to defending the justice of the American cause in Vietnam and praising President Nixon's foreign policy. "In Vietnam we seek the self-determination of a people, not territory or military victory," he said. Raymond E. King Jr. general agent for Lincoln National Life in Charlotte, North Carolina, was chosen president of the National Association. King was very active in North Carolina politics, and even contemplated running for Congress. He willingly offered his legislative influence and political know-how in helping to advance the interests of America's life insurance agents. While serving as an NALU trustee, he headed the Special Committee to study and make recommendations regarding the associated agents' political activities. This committee had been responsible for the organization of the Life Underwriters Political Action Committee, and King had served as LUPAC board member for three years. The 1969 Russell award recipient was John O. Todd who was applauded as a highly productive and innovative life underwriter, a popular speaker and an institutional leader through his involvement with the Million Dollar Round Table, the NALU and the Association for Advanced Life Underwriting. Nearly eight hundred people attended the award dinner. Former NALU president Philip Hoche made the presentation and former Texas governor John B. Conally was the featured speaker. During this period NALU executive vice president C. Carney Smith continued expanding and refining the Associations organizational structure. Changes in personnel imposed readjustments in some areas, while they brought relief to others. The addition of another young attorney, Michael L. Kerley, in the summer of 1969 gave the legal department a staff of five. In January of 1970 Robert H. Wood, director of administration and personnel, resigned to become assistant executive director for the National School Boards Association. On February 6, Hebert G. Keene, NALU's business manager, died in his office of a heart attack. He would have been 65 on February 21. Keene had served as NALU's business manager since 1957. Smith appointed Lee Derkay director of administration and in April hired Douglas Blair as office manager. A year later Samuel Bohinc, a recently retired army officer, replaced Blair. During the summer of 1971, Charles D. Rumbarger, formerly executive director of the Pennsylvania Association of Life Underwriters, was hired to direct the NALU field services program. Meanwhile, the NALU's sister organizations underwent managerial readjustments as well. In March 1970 the Life Underwriters Political Action Committee acquired a permanent director, Austin Adkinson, and soon afterwards set up offices in NALU headquarters. On November 25, Horace Flickinger, executive director of GAMC, suffered a heart attack. He died on January 8, 1971, at Bon Secours Hospital in Baltimore. In the emergency L. Kent Babcock of Philadelphia took over the management of the organization until a permanent director could be found. Since he was also head of LUPAC, Babcock found himself with a heavy schedule that necessitated frequent commuting between Philadelphia; and Washington. He was relieved in early 1972 when Kenneth Van Riper, Jr., was hired as executive director of GAMC. Riper's assistant was Robert H. Humphreys who became the organization's director during the last months of 1973. The early 1970's also witnessed several personnel changes on the staff of Life Association News. In 1970 Gaglio hired Joseph C. Razza, Jr., to replace David I. Bohart as associate editor and Wallace I. Longstreth replaced staff writer Jerry Gordon in 1971. Following other resignations, Edward P. Keenan was hired in January of 1972. During the January 1970 meeting the NALU Board of Trustees issued its first official statement of the matter of agents charging fees for financial services. Life Association News reported:
In an unprecedented move, NALU trustee Fred E. Provenzano, general agent for Kansas City Life in Colorado Springs, withdraw his candidacy for NALU secretary late that summer. Ordinarily the successful candidate for NALU secretary becomes the Association president two years later. A dedicated association worker, Provenzano was popular with the agents. It was not an easy decision, but he had serious health problems and felt he had no choice But to step aside. At the annual meeting that fall in Minneapolis, the delegates chose W. Franklin Steiner of Mobile, Alabama, to serve at the Association's secretary. As war raged in Vietnam in the early 1970's, America's streets, parks and college campuses echoed with amplified rock music, cries of protest and threats of violence. Highly publicized on nightly television news programs, demonstrations of civil disobedience conducted by denim-clad, unkempt and often disorderly mobs of university students and youthful hangers-on became almost commonplace. The aim was to disrupt normal activity to voice opposition to American foreign policy in southeast Asia and to put an end to conscription. The angry rhetoric generated a good deal of unpleasantness, and everyday life was sometimes interrupted either by actual or rumored acts of terror. " If and when someone ever writes a 100 year history of the National Association of Life Underwriters," commented a reporter for Life Association News in October 1970, "he might observe in a footnote that the 81st annual convention's informal but dominant theme was the possibility of finding a hidden bomb at a meeting site and what to do if one were actually found." When the 3,200 registrants and guests converged upon the Leamington Hotel on September 13, he explained, Minneapolis, like a number of other cities in the Midwest, was experiencing a few bombings and numerous bomb scares in public places. "Fortunately," he added, "none of the NALU meeting was interrupted by crackpots placing bombs in obscure places or making phony bomb threats over the telephone." Emphasis at the Minneapolis meeting was on salesmanship and marketing techniques. Forty-two-year-old Herbert F. Mischke, agent for Equitable of Iowa in St. Paul, Minnesota, was named NALU president. A highly successful agent, he regularly qualified for the Million Dollar Round Table and, as former president of the American Society of Chartered Life Underwriters, Mischke had been very active in life insurance education. C. Carney Smith received the John Newton Russell Memorial Award that year. In citing him for the honor the committee said, "You have employed vast talents as communicator to challenge us to do what is right, to build, to bring us closer together. …Under your direction, NALU has shown marked and continuing growth, creative expansion of services and broader involvement in public affairs, government relations and political education and action." When the ninety-second Congress convened in January 1971, its members faced a hefty agenda and a heavy social calendar. Not the least item on their list was the annual reception at 1922 F Street. An impressive two hundred fifty Senators, Representatives and government officials came to NALU headquarters to meet or renew acquaintance with the Association's officers and executive staff. One topic of discussion was the growing concern in the insurance industry over the intrusion of banks in the field of insurance. The 1970 amendments to the 1956 Bank Holding Company Act raised a number of points that only became clear on August 10, 1971, when the Federal Reserve Board announced its long-awaited decision on insurance agency activities in banks. Under the act, bank holding companies were permitted only those activities "so closely related to banking or managing or controlling banks as to be a proper incident thereto." Consequently, the agents objected to the new ruling that allowed banking institutions to provide insurance that was "directly related to the provision of other financial services by a bank or such a bank-related firm." The NALU also took exception to banks providing insurance "sold as a matter of convenience to the purchaser." As the NALU's legal department pointed out, "It is very difficult to follow the reasoning…that an activity engaged in 'as a matter of convenience to the purchaser' can be said to be one 'so closely related to banking or managing or controlling banks as to be a proper incident thereto.' If the convenience of the purchaser is the criterion for determining what is closely related to banking, then indeed no activity of any kind is really prohibited. It is no answer to this objection that the privilege is seriously restricted….NALU is very seriously concerned with this provision and is studying it to determine what further steps might be taken to have it removed form the regulation."[xxxix] Delegates at the 1971 national convention elected John P. Meehan of Boston to serve as president of the national organization. This was the first annual meeting held in New York City since 1918. The New York Hilton was the center of most of the activity and "Consumerism and Life Insurance" dominated as the principal topic of discussion. A panel discussion was devoted to "Delivering Health Care to America—How and by Whom?" The success of the convention demonstrated that Marvin Kobel and his staff had gone to considerable trouble to provide a well-orchestrated and interesting meeting. The NALU's public relations office drew accolades for some of its other projects, as well. Trustee Iram H. Brewster, chairman of the Public Relations Committee, announced that an advertising campaign in nationally circulated magazines would begin in January of 1972. The series of six advertisements, appearing in Newsweek, Time and Sports Illustrated were designed to draw favorable attention to the services performed by career life insurance agents.[*] Those attending the convention also got a viewing of the first three films of the series on "Your Career in Life Insurance Selling." Primarily inspirational, these movies depicted the life insurance agent's vocation as interesting, useful and fulfilling. The plan was to make the whole series available to local associations for showings at their meetings and in schools. The year before, the NALU's Public Relations Department had supplied the agents with a very successful series of films dramatizing insurance as a factor in family financial security. These had been produced at Auburn University's drama department in cooperation with the Institution of Life Insurance. Kobel's ingenuity in obtaining a very popular speaker, Bishop Fulton J. Sheen, for the John Newton Russell Award Dinner also won the applause of the diners. Robert L. Woods, a thirty-seven-year veteran general agent for Massachusetts Mutual in Los Angeles, received the award. Commenting on the violence of the times Sheen said, "Discipline was declined everywhere except in the military academies and on the football fields. We will get rid of violence wen we get discipline at home." Still, he added, "There is much hidden love. I know of a beautiful airline stewardess who gave up her career in the United States to serve in a leper colony in Vietnam…So, love can reign in the heart despite all the unrest we see today." The New York convention was also the occasion of the LUTC's silver anniversary. Both Benjamin N. Woodson and Edmund L.G. Zalinski were on hand to toast the milestone. "LUTC still keeps on teaching and preaching the fundamentals of life underwriting, the fundamentals of cash value life insurance and the usefulness but the limited effectiveness of term insurance," Woodson declared. "LUTC will continue to teach the values of guaranteed bargaining power, the values of basic guarantees, the values of life insurance for many business uses. It will continue to teach those things and will do it merely better and better and better," he concluded. Hosted by LUTC board chairman Jack Peckinpaugh of Muncie, Indiana, the special luncheon in the Imperial Ballroom of the Americana Hotel featured U.S. Representative to the United Nations George Bush as principal speaker. Bush did not speak of insurance but of foreign policy, focusing particularly on the question of Red China's admission to the United Nations. "The times require new approaches," he said, "a readiness to talk, a willingness to intent—because the alternative of war is no longer acceptable to the human race….The world is now too small for war." On July 31, 1972, the first known sale of a variable life insurance policy in this country was made in Little Rock Arkansas. The buyer was the Arkansas Neurological Clinic, Ltd., as part of a qualified pension plan for its employed which purchased the policy from Aetna Variable Annuity Life , a Little Rock based subsidiary of Aetna Life and Casualty. Life Association News reported the incident in its September number that year:
By the following March NALU executive vice president Carney Smith was able to report,"At long last the SEC has made its decision on variable life insurance. SEC determined that while variable life insurance is a security, subject to securities laws and regulations, agents selling variable life will not be controlled by commission scales that pertain to mutual funds." Smith predicted a rush to promote the new product. "It would seem," he added, "that most of the objections that the agent might have to variable life sales are taken care of in the product design now being contemplated by most companies interested in the field and by the ruing of the SEC." Consumerism was becoming a popular concept at this time. Developing a method for adequate cost disclosure for an increasingly skeptical public posed a real problem of the industry. How to estimate the value of a policy and project its ultimate value was a delicate ethical issue for agents. With the advent of interest sensitive policies it is hardly surprising that various methods of comparing policies was a hotly debated question. When the NALU held its annual convention in Atlanta, a debate over the proposed "interest adjusted method" of valuation lasted more than an hour. In the end, the delegates approved the resolution offered by Richard W. Bandfield, agent for New England Life in New York City, which said "that the National council go on record in opposition to the required use of any specific formula and idea which purports to represent the cost or relative value of a life insurance." The delegates also endorsed the choice of W. Franklin Steiner of Mobile, Alabama, as president for the 1972-73 Association year. An agency manager for Lincoln National Life, he was regarded as an excellent representative of the home service side of the business. NALU treasurer Paul E. Gibson of Washington, DC resigned on December 1, 1972 to become regional vice president of Lincoln National Life. In a mail ballot vote, the Board of Trustees elected L. Kent Babcock treasurer. Speaking of Babcock's long service to the Association Steinger observed, "It is fortunate indeed that he has once again made himself available to help the association carry out its organizational responsibilities. In the past he ably stepped into the breach to serve the remainder of the term of a deceased NALU trustee and was acting executive director of the General Agents and Managers Conference of NALU after the death of Horace D. Flickinger."[**] In 1973 the American Life Convention and the Life Insurance Association of America merged to create one organization, the American Life Insurance Association. (Later the name was changed to the American Council of Life Insurance [ACLI] and the organization absorbed the institute of Life insurance which functioned as its public affairs and press relations department. Blake Newton, president of the Institute, became head of the new organization.) "This merger culminates about 25 years of effort by both associations to create a single organization to represent the life insurance companies selling the bulk of the business," commented Life Association News. "The new association serves 355 member companies, representing about 90 percent of the $1.6 trillion of all the life insurance in force in America," the article added. Offices in New York and Chicago continued to operate until June 30. At that point both groups consolidated the operations and set up office at 1730 Pennsylvania Avenue, N.W. Washington, DC. 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 [*] Each of the magazine ads emphasized a theme such as competence, ethics, or service. The one labeled "Service," for instance, read: "Thoughtful, professional, efficient service. That's what you expect and need form a person who helps you plan for the overall well-being of your family and business. The person? A well trained businessman…a career life underwriter who constantly updates his knowledge, upgrades is skills though meetings, continuing education, research. NALU…The National Association of Life Underwriters is dedicated to helping its locally affiliated members provide the best possible service." [**] In 1964, Babcock completed the term of NALU trustee Ed H. Downs, General Agent for Midland National in Aberdeen, South Dakota, and a former state senator, who had died of a heart attack on October 31. [xxix] LAN, August 1966, p. 22 [xxx] Smith: Interview, May 1985 [xxxi] Fluegelman: Interview, September 1985 [xxxii] LAN, October 1966, p.3 [xxxiii] Ibid., p. 24-28 [xxxiv] LAN, May 1968, pp 99 [xxxv] Op. Cit., January 1968, p. 21 [xxxvi] Op., cit., September 1968 p. 29 [xxxvii] Op., cit October 1968p. 23 [xxxviii] Op. Cit., March 1970, p. 87 [xxxix] LAN, September 1971, pp 104-105 [xl] Op. Cit. Pp. 120-121 © Advisor Today 2008. All rights reserved.
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