The History and Impact of Reliance Standard Life Insurance Company

Reliance Standard Life Insurance Company has a long and storied history as one of the first and most influential life insurance companies in the United States. Founded in 1907, Reliance Standard has helped protect American families and businesses for over 100 years.

The Founding of Reliance Standard in 1907

Reliance Standard was founded in 1907 as the Reliance Life Insurance Company in Philadelphia, Pennsylvania. It was started by a group of businessmen led by H.B. Alexander, an actuary who had previously worked for Penn Mutual Life Insurance Company.

Some key facts about Reliance Standard’s founding:

• It was founded as a stock company, which was still relatively new for life insurance at the time. Most other life insurers were structured as mutual companies owned by policyholders.

• The founders started the company with a capital stock of $1 million, which was large for a new life insurance company at the time.

• Reliance Standard sold traditional whole life insurance policies from the start, providing lifetime coverage and a savings component.

• In the first year, Reliance Standard sold over $2 million in new life insurance coverage.

• The company was founded during a period of rapid growth for the U.S. life insurance industry. Improved actuarial science and shifting attitudes made life insurance more popular and accessible.

Within just a few years, Reliance Standard had grown to become one of the leading life insurance companies in the mid-Atlantic region of the U.S. The company stood out with its financial strength, use of up-to-date actuarial practices, and agent training programs.

Early Growth and Expansion

In the decades after its founding, Reliance Standard experienced strong growth and expanded nationally:

• 1910s – Reliance Standard expanded beyond Pennsylvania and New Jersey into states like New York, Virginia, North Carolina, and Michigan.

• 1920s – The company surpassed $1 billion of life insurance in force and became licensed in over 30 states. Reliance Standard moved its headquarters to Chicago to aid national expansion.

• 1930s – During the Great Depression, Reliance Standard remained financially strong when many insurers failed. Assets grew over the decade from $60 million to $200 million.

• 1940s – Reliance Standard continued expanding nationwide despite losses sustained during WWII. Insurance in force doubled from $2 billion to over $4 billion.

• 1950s – Reliance Standard was licensed to sell insurance in all 48 states, D.C., and Canada. New field offices opened around the country to serve agents and policyholders.

A few reasons why Reliance Standard prospered and expanded during its early years:

• Careful risk management and reserving ensured the company remained solvent.
• Continuous agent training and recruitment programs grew the sales force.
• Investment management delivered steady returns even during challenging markets.
• Adoption of computing technology improved efficiency and customer service.
• A national network of field offices kept operations aligned across the country.

By the late 1950s, Reliance Standard Life Insurance Company had grown into one of the 25 largest life insurance providers in the United States.

Developing Group Insurance and Specialty Products

In addition to traditional individual life insurance, Reliance Standard helped pioneer group life and disability insurance in the workplace. The company issued one of the first group life insurance policies in 1911. Group products grew to account for the majority of Reliance Standard’s new business after WWII.

Some other product innovations:

• Annuity products – Reliance Standard’s annuity business began in the 1950s to meet demand from retirees. Fixed, variable, and indexed annuities remain a core product line today.

• Long-term disability – Reliance Standard was an early provider of long-term disability benefits which protect incomes in case of extended illness or injury. First policy issued in 1957.

• Dental insurance – One of the first life insurers to offer dental insurance starting in the late 1960s. Reliance Standard’s dental plans covered preventive care along with basic and major services.

• Special risk life insurance – Reliance Standard had a specialty practice for higher risk or impaired risk life insurance cases declined by other carriers. Prevented people from being denied coverage.

By developing these specialty products and lines of business, Reliance Standard demonstrated an ability to adapt and innovate over the decades while remaining committed to its core life insurance business.

Leadership and Major Events Through the Decades

Reliance Standard has been shaped by its long-tenured leaders and major events over the past century:

• 1920s – S.D. Fraser, company president from 1923 to 1955, guided Reliance Standard’s national expansion from its new Chicago headquarters.

• 1960s – President Leland S. Beyer oversaw Reliance Standard’s growth to over $10 billion of coverage in force. Reliance Standard Holding Company was formed as a publicly traded parent.

• 1970s – Reliance Standard encountered financial and regulatory troubles leading to a takeover byUtilities Mutual Insurance Company in 1979. Kenneth H. Long Jr. took over leadership to turn the company around.

• 1980s – Leadership stabilized the company and restored its financial footing, including a return to profitability by 1984. Reliance Standard exited unprofitable lines of business.

• 1990s – Under President Stephen O. LeClair, revenues grew from $600 million in 1990 to over $2 billion by 2000. New group dental, disability, and managed care products were added.

• 2000s – After demutualization in 2000, Reliance Standard was acquired by Delphi Financial Group in 2001. In 2002, the headquarters moved back to Philadelphia where the company originally began operating in 1907.

• 2010s – Reliance Standard was acquired by Tokio Marine in 2011 as part of its expansion in the US life insurance market. Reliance Standard has stabilized and grown under Tokio Marine’s ownership.

Through changes in leadership, acquisitions, economic ups and downs, and evolving insurance regulations, Reliance Standard has shown remarkable staying power as an insurance provider for over 100 years.

Financial Strength and Industry Rankings

Reliance Standard has maintained strong financial health across its history:

• Reliance Standard holds $18.7 billion of assets under management as of 2020.

• Total liabilities stand at $16.3 billion, backed by solid capital reserves.

• Statutory capital and surplus has grown from $27 million in 1979 to around $1.5 billion today.

This financial foundation has earned excellent ratings from insurance industry analysts:

• A.M. Best – Rated A (Excellent) based on balance sheet strength, operating performance, business profile, and enterprise risk management.

• Moody’s – Rated A2 (Good) with a stable outlook based on profitability, capital adequacy, and business profile.

• Standard & Poor’s – Rated A (Strong) with a stable outlook based on capital adequacy, competitive position, management, earnings, and liquidity.

Reliance Standard ranks among the top 60 out of over 800 US life/health insurance companies based on admitted assets and surplus. It is licensed to provide insurance in all 50 states plus D.C. and US territories.

Impact on Policyholders and Communities

The biggest measure of Reliance Standard’s impact over 100+ years is the financial protection and peace of mind the company has provided:

• Individual policyholders – Over 4 million individual life insurance policies have been issued to date insuring families and loved ones.

• Group clients – Tens of thousands of businesses have relied on Reliance Standard for group insurance plans covering millions of employees and dependents.

• Claim payments – Around $13 billion has been paid out in life, disability, dental, and other insurance claims since 1907.

• Charitable giving – Over $2 million donated annually to national and local non-profits supporting health, human services, education, and cultural causes.

While evolving as a business, Reliance Standard has remained committed to helping policyholders and communities manage risks and provide for the future. The company’s longevity and financial strength offer assurance that it will be there to fulfill its promises for decades to come.

What the Future Holds for Reliance Standard

As Reliance Standard moves into its second century of business, the company is well-positioned for continued success in protecting American families and businesses.

Its strategic direction aligned with the strengths of Tokio Marine Group gives Reliance Standard advantages in areas such as:

• Product innovation – Leveraging insights and expertise from Tokio Marine affiliates to develop new solutions for evolving insurance needs.

• Digital transformation – Investing in technology and analytics to improve customer experience, unlock efficiencies, and enable new data-driven business models.

• Financial strength – Maintaining rock-solid balance sheets across market cycles thanks to disciplined underwriting and risk management.

• Global collaboration – Working with Tokio Marine’s global network to enter new markets and enhance Reliance Standard’s value