Law on ‘Slave Insurance’ to Debut Soon

A new state law aimed at illuminating the legacy of slavery will order insurers doing business in California to make public any “slave insurance” policies they may have issued during the 19th century.

The law, sponsored by state Sen. Tom Hayden (D-Los Angeles), will take effect Jan. 1. It has no punitive impact on insurance companies. But scholars and activists, who say it is the first state measure of its kind, believe it could provide ammunition for the nascent black reparations movement. That effort is attempting to model itself after the success of Holocaust survivors, who in recent years have won billions of dollars from European companies associated with the Third Reich.

Supporters have yet to fashion a specific legal strategy. But they believe that forcing insurance companies to disclose issuance of slave insurance would create potential targets of lawsuits which, in turn, might embolden other African Americans to file suits against other industries that indirectly profited from slavery.

The slave-insurance bill originally required hearings to determine whether African Americans have legal standing to seek compensation from insurance companies. It contended that money paid to the owners of slave insurance was actually owed to the descendants of slaves. But the bill passed the Legislature in a weaker form, lacking any hearings or compensatory provisions.

Nevertheless, Washington attorney Alexander Pires, one of a bevy of lawyers around the country preparing a class-action reparations lawsuit against numerous industries and government agencies, says California’s law will strengthen his hand.

“The more we hear about these things, the easier it’s going to be for plaintiffs to say: ‘Look, this is not a fairy tale, this is true,’ ” he said.

Slave insurance was common among slave traders and the largest slaveholders until 1863, when American bondage was prohibited. The practice probably originated in Europe as a way for slave traders to insulate themselves from the great risks associated with the transportation of African slaves across the Atlantic Ocean.

One of the best-known court cases involving slave insurance took place in the 1780s when the captain of a slave ship called the Zong was accused of fraud. As it sailed from Africa with a full load of slaves, the Zong was wracked with cholera and nearly ran out of food and water. The captain threw 200 slaves overboard and was embroiled in a tortuous legal fight when he tried to collect insurance upon his return to England.

Some scholars argue that slave insurance may have been a predecessor to modern-day life insurance.

By the 1800s, a single slave in the United States could be worth as much as $30,000 in today’s dollars. “Slaves were big-time investments,” said Walter Johnson, a New York University history professor and author. “Generally, the buying of slave insurance would be preceded by a medical exam in the slave market. It would be a real complete, naked, invasive physical examination.”

Then, depending on the age, skills and health of the slave, an insurance company would set a price. If the slave died, the slaveholder would be the beneficiary.

Earlier this year, Aetna Inc., the nation’s largest insurer, publicly apologized for selling slave insurance policies in the 1850s after a New York woman contacted the Harford, Conn.-based company to seek an apology and reparations.

In recent years, Reps. John Conyers Jr. (D-Mich) and Jesse L. Jackson Jr. (D-Ill.) have repeatedly supported bills calling for federal commissions to research the impact of American slavery and to recommend “appropriate remedies.”

Jackson said he supported the California law and hopes to see similar laws enacted elsewhere. “The nation must come to grips with the truth and consequences of its history.”

The insurance industry is both willing and wary. Although they registered no opposition to the final version of the bill and have pledged to fully comply, some industry officials expressed concern over efforts to seek reparations, and downplay the involvement of modern-day companies in the slave trade.

Thus far, Aetna executives say they have come up with only a handful of slave insurance policies--to the derision of history scholars and reparations activists. But Robert Hartwig, chief economist for a New York-based insurance industry trade group, said most of the firms operating before 1863 have either dissolved or were bought by other companies long ago.

Hartwig says some insurers have already begun to look into their archives, but on Friday Hartwig said he knew of no other companies that had acknowledged issuing slave insurance policies.

Apart from practical considerations about finding insurance companies involved in slavery, Hartwig also questions the fairness of singling out his industry.

“If you want to cast a net of blame for slavery, you’re going to have to cast it over the entire 19th century economy and virtually every industry and company which can trace its roots back to the mid-1800s,” he said. “The question is why now, why insurers, and does this nation need to tear open wounds which are still being healed today?”

Eric Foner, a noted Civil War historian and author, said such disclosure is not only necessary, but helpful because “it directs attention to the centrality of slavery in American history.”

However, he agreed with Hartwig’s point that the insurance industry wasn’t the only sector of the American economy involved in slavery.

“The entire New World was based on African slavery,” said Yale historian David Davis, “and a large number of the jobs in France and England were dependent on slavery. Fortunes were made all over the place either directly from the selling and labor of slaves or insurance or clothes and food and all the things that slave owners needed to outfit their slaves to work.

“So it would seem to me to be impossible today to get a fair representation of all the capital involved.”

SEARCH FOR JUSTICE

A movement seeking reparations for the descendants of American slaves surges. E1