The Early 20th Century: Insurance Becomes a Social Institution

The Great Depression & Government Intervention: The Great Depression of the 1930s had a significant impact on the insurance industry. Many insurers faced insolvency due to the stock market crash and widespread economic turmoil. In response, governments stepped in to regulate the industry and provide protections for policyholders.
- U.S. Regulation and the New Deal: In the United States, the New Deal era of the 1930s brought about important reforms in the insurance sector, with the creation of the Federal Deposit Insurance Corporation (FDIC) in 1933 to protect bank depositors and the Social Security Act of 1935 to establish federal old-age insurance and unemployment compensation.
Health Insurance Growth: In the U.S., the introduction of Blue Cross in the 1930s marked the beginning of group health insurance programs, primarily aimed at hospital costs. During World War II, as wages were capped, employers began offering health insurance as a fringe benefit, a practice that continued to expand post-war.
The Rise of Group Insurance: The growth of the welfare state in the mid-20th century led to the rise of group insurance. Large companies began offering comprehensive insurance packages to employees that included life, health, dental, and disability insurance. This period marked a shift from individual policies to corporate benefits, leading to the standardization of employer-based health insurance.

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