Did you know that insurance played a significant role in World War II? Before the U.S. got involved, President Roosevelt developed a shipbuilding program to support Britain’s need for reinforcements. These ships would help Britain replace supply ships that were under German U-boat attack. The ships, called Liberty Ships, were designed to be mass produced quickly and inexpensively. Nearly 3000 Liberty Ships were built by 1945. Although the government initiated the shipbuilding program, the vessels were built by private companies. These companies knew their
products would be heading into war zones, so they needed some guarantee of protection against damage and loss. To incentivize private shipbuilders, the government relied on the War Risk
Insurance Act of 1917. Initially passed in 1914, the legislation provided insurance coverage for cargo loss and damage to ships during war. The update in 1917 added life insurance for crew members aboard those ships.
Private Insurance Backed by the Government
The War Risk Insurance Act essentially used the power of the U.S. Treasury to back the insurance policies written by private insurers. Manufacturers were then empowered to employ thousands of men and women to build huge ships that would be sent to Europe. In a World War, all ships are at risk. Even vessels that are
intended for cargo and trade are passing through dangerous waters. The insurance allowed the U.S. to continue participating in global commerce throughout the years of war. The protection gave private companies during that time period the confidence to strengthen our economy through employment and trade.
Insurance for Property Damage Caused by War
The War Risk Insurance Act covered ships, soldiers, and crews in international waters. Here at home, Americans wondered what they could do to protect their property if the U.S. became a major front in World War II. The War Damage Corporation was developed in 1941 to address exactly this concern. For the first time in U.S. history, individuals could insure their personal property against war damage. Once again, private insurers required the backing of the U.S. Treasury to subsidize the policies they were being asked to write. The War Damage insurance program caught the attention of other countries, and many still have these programs in place today. The U.S. War Damage Corporation that provided backing for the insurance coverage was dissolved in 1947 since the war was over.
Is There War Damage Insurance Available Today?
Today, we think a little bit differently about war. The threat of war in America looks nothing like it might have in the 1940s. Modern technology protects our nation from many far off dangers. But we still have risks. Today’s concerns about what we might call “war damage” involve acts of terrorism or riots getting out of control. Coverage can be added to personal and business property policies to cover this type of loss. People who travel internationally can add special travel insurance to cover cancellations due to acts of war in their destination country.
Today’s biggest insurance concern regarding war or terrorism is actually that of cyber-attack. Individuals and businesses should protect themselves against every threat – foreign or domestic – when it comes to their cyber security. Cyber insurance is vital in today’s world where weapons of war can travel through fiberoptic cables.
At Smyrl Insurance, we are avid history buffs, and exploring these topics is certainly interesting. Although we are not alarmists when it comes to modern risks, we are realists who understand the value of protecting what is important. When bad things happen in the world, insurance is one tool that prevents people from losing everything. If you are thinking about your property or business in light of current world events, contact us to review your policies. We educate, nurture, and empower people through insurance to make sure they understand what coverage works best for their individual circumstances. We serve clients for business, personal, life, and other types of insurance in Hatfield, Lansdale, Souderton, Harleysville and throughout Montgomery County, Pennsylvania.
