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An American Dilemma
1262
Some Northern states have made attempts to stop discrimination in insurance; the
New York act even forbids the refusal of a Negro’s application because of his race
alone. (See Charles S. Mangum, Jr., The Legal Status of the Negro [1940], p. 70.)
Most data on Negro life insurance, except when otherwise stated, are based on Reid,
op. W/., Vol. I, pp. 37-69.
See, for instance, U.S. Department of Labor, Bureau of Labor Statistics, Study of
Consumer Purchases^
Family Expenditures in Selected Cities: 7955-5 d. Bulletin No.
648, Vol. 8, ‘‘Changes in Assets and Liabilities” (1941), pp. 70-179. U.S. Department
of Agriculture, Bureau of Home Economics, Consumer Purchases Study^ Changes in
Assets and Liabilities of Families^ Miscellaneous Publication No. 464 (1941), pp. 50
and 79. Concerning average amounts of premiums, see also, Richard Sterner and
Associates, The Negroes Share, prepared for this study (1943), p. 152 and Appendix
Table 35.
According to the Consumer Purchases Study it is quite usual that every year as
much as 5 or 10 per cent—sometimes up to 15 per cent—of the low income families
surrender their insurance policies; the proportion of policies which fail to reach maturity
must under such circumstances be extremely high. (U. S. Department of Labor, Bureau
of Labor Statistics, Study of Consumer Purchases, Family Expenditures in Selected
xpj5-j(5, pp. 70-179.)
survey of funeral expenses connected with 7,871 “adult deaths” of industrial
policyholders in 1927 revealed that the average cost of burial was $363. The average
insurance carried was somewhat lower ($309). Another group studied was composed of
3,121 veterans, for whom the average burial cost ranged from $241 in towns with less
than 10,000 population to $336 in cities of over 250,000. Funeral expenditures of
319 dependent widows applying for pensions to the New York Board of Child Welfare
averaged $247 in the Jewish group, $421 in the Italian group, and $452 in the Irish
group. It happened frequently that low income families spent large sums on an extrava-
gant funeral and a few weeks later applied for relief. The high fees apparently had
caused an over-expansion in this business; it was ascertained that 92 per cent of the
undertakers in New York City made a living on an average of but 25 funerals a year.
(John C. Gebhard, Funeral Costs, Miscellaneous Contributions on the Costs of Medical
Care, Number 3, The Committee on the Costs of Medical Care [1930], pp. 3-7.)
Although conditions may have changed since the time of this study, it is a well-known
fact that funeral costs are still high.
We have asked Negro insurance officials whether it would not be in the public
interest for the insurance companies to develop policies which would set limits to the
extraordinary expenses that poor Negro families incur when one of the family dies, and
whether they would not start an educational campaign to teach people the importance
of keeping insurance for the survivors instead of spending it on funerals. 7"he answers
have, in general, been the following: (i) one should not interfere with the desires of
people to use their money as they please; (2) the intense desire among even the poorest
Negroes to guarantee a decent funeral after death is one of the strongest incentives for
keeping up insurance, and the insurance companies should not be expected to demolish
the basis for their own business; (3) even granted that the morticians artificially stimu-
late in an unsocial way conspicuous consumption in luxurious funerals, and that, parti-
cularly, they exploit the poor people, one business should not be expected to take a stand
against another business; (4) the morticians are so powerful in the Negro community,
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