February 8, 2012 by Milton Jones
The Debit Man, with his large leather bound collection book, was a familiar figure during much of the 20th Century. He would make his rounds through the neighborhood, collecting small insurance premiums in cash and recording the transactions in the homeowner’s premium receipt book.
Along with the milkman and the Watkins peddler, home service insurance thrived until fairly recent times. If you owned this kind of insurance, it was not unusual for the Debit Man to appear at your door every week. Typically, the policies were of $500 or $1,000 face amounts, and premiums might be 25 cents a week, per policy. Perhaps there was a $1,500 policy on the father, $1,000 on the mother, and $500 on each of the three children.
The official name for these weekly premium policies was “Industrial” insurance, and has its roots in the changing society brought about by the industrial revolution. As people left their small farms to work in the factories, they also left behind the inherent security of their farm. Living in crowded cities, families often did not have money to properly bury their dead. Existing life insurance policies called for an annual premium, which few people could afford.
In answer to this societal need, an insurance system grew up whereby agents could sell small policies and collect the premiums weekly at the factory gates or at the homes. Families were provided with a delivery system that enabled the working poor to afford small amount of life insur- ance suitable for burial needs. Since this system grew up with the Industrial Revolution, this class of coverage came to be called “Industrial” insurance.
This system thrived through the Great Depression, WWII, and up until fairly recently. In hard economic times, people grow more security conscious, so the Deb- it Man was able to earn a good livelihood even in such hard times because he could sell policies for premiums of a few cents weekly. Families were provided with a small measure of security, and were able to pay the funeral director with a few dollars left over.
My own insurance career began in the 60s in this environment. Prior to that time I would have been unable to imagine my- self as a door-to-door salesman. Having an established debit route of collections gave one a certain routine to follow and provid- ed a base income. You would soon become friends with the families, and most of them were happy to see you come, and would offer you a morning cup of coffee.
I learned to knock doors and introduce the family to our “services.” Some of the best friendships of my life resulted from those “new home calls,” as the Company fondly called them.
My old company, The National Life & Accident, is gone now; having been swallowed up in mergers 30 years ago. Such major names as the Prudential and Metropolitan (MET-LIFE) grew up this way. With changing times, and changing economics, this system became too expensive and has become only a memory.