Major Principles of Insurance #1

When my Grandfather returned at the conclusion of the Second World War from serving six years overseas with the Royal Canadian Artillery he contemplated a career in the financial sector and had narrowed his choice to the brokerage, banking or insurance industries.

He was shocked to learn of the suicide of one of his best friends from their pre-war school days. This gentleman had a medical exemption from service and worked for his Father’s privately owned investment firm. The financial ravages of the depression had adversely diminished the investment account assets of many returning servicemen and women, former classmates and he could not face this consequence.

Having witnessed firsthand the deprivations and earth shattering consequences of the war in Europe, promises broken and dreams ended, my Grandfather’s decision was made. He chose the insurance industry for 2 reasons. The first was the principle of creating dollars when needed at a discount, for the few, utilizing the actuarial principle of spreading the risk amongst the many. The second was the principle of the insurance mortality proceeds always being guaranteed. A Canadian Life Insurance company has never failed to pay 100 cents on the dollar of any claim due to insolvency.

For pennies on the dollar his clients could create guaranteed estates to protect their families and businesses and support their legacies. In Europe entire nations, cities and regions had ceased to exist. The concept of guaranteeing insurance proceeds to fulfill dreams, educate the next generation and rebuild their foundations with bricks and mortar in the event of the premature death of a breadwinner was something that he grasped immediately and that stayed with him all his life.

It stayed also with his 2 Sons, Daughter in Law and 4 Grandchildren who followed him into this wonderful industry. This series will address some 21st Century case studies of those major principles of insurance which are as valuable today as they were 72 years ago