I have been in the health and life insurance business for over two decades. I have sat in bars with some old life insurance agents that with enough cocktails, will tell you they wrote the first life insurance policy. However, life insurance does go back a few hundred years even before some of the older life insurance agents hanging around today were ever thought about being born. Let’s take a look at the history and growth of the life insurance industry.

An investigative reporter by the name of Ronald Kessler set out to answer this question. He wrote a book called The Life Insurance Game back in 1985. He did discover definitive information that the oldest life insurance policy can be traced back to London in 1583. The insured was a gentleman by the name of William Gybbon. Mr. Gybbon worked in London as a Salter of meat and fish used to preserve the meat. The company underwriting the plan was not clear, but the beneficiary was known to be Richard Martin. No one really knows their relationship or the face amount of the policy other than it was a one year term, but it is an interesting story. William Gybbons actually died near the end of the policy year. The underwriting company refused to pay the claim on the grounds that the contract was for a lunar year versus a calendar year. The courts ruled in favor of Richard Martin and the claim was paid. So, even 430 years ago insurance companies were playing the loophole card.

Since then, the life insurance industry has grown and flourished into a $4.8 trillion industry in the US alone. According to the American Council of Life Insurers,  20% of the world’s life insurance premiums originate in the US. It is estimated that there is over $18.4 trillion of life insurance in force in the US alone. That is actually larger than the US debt of $16.7 trillion. Premiums collected eclipse $530 billion with net earnings north of $130 billion per year. The life insurance industry employs approximately 2.5 million workers and agents directly and indirectly. Today just in the US there are over 1,000 life insurance companies. The largest in the US is MetLife with about 10% market share, followed by AFLAC with 7% market share of life insurance and third is Prudential with 6% market share.  Life insurance companies invest a staggering 33% of the American economy making them one of the largest sources of investment capital in the United States. If you think that life insurance doesn’t pay out, consider that the industry pays $1.5 billion per day in death claims, annuities, disability, long term care and retirement withdrawals.  It is estimated that 75 million families or 67% of US households depend on life insurance for their financial and retirement security. The United States would be in peril without the life insurance industry and what it has became today. It is an interesting evolution over the past 430 years from the death of a London Salter to a $4.8 trillion industry in the United States alone.

We urge you to contact a local life insurance professional today and have your policies reviewed by an experience professional. Your loved ones will thank you for taking care of them when you are gone one day.

“The hour of departure has arrived, and we go our separate ways, I to die, and you to live. Which of these two is better only God knows.” ― Socrates

Image courtesy of David Castillo Dominici at FreeDigitalPhotos.net

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Tim Wilhoit is owner/principal of Your Friend 4 Life Insurance Agency in Nashville, TN. He is a family man, father of 3, entrepreneur, insurance agent, life insurance broker, salesman, sales trainer, recruiter, public speaker, blogger and team leader with over 26 years of experience in sales and marketing in the insurance and beverage industries.