I hope life and health insurers will organize a major effort to commemorate the Spanish influenza centennial next year.
It’s hard to know what will happen to U.S. health care or U.S. health insurance in 2018. One of the few things that’s certain is that 2018 will occur 100 years after 1918.
We also know, for certain, that 1918 was the year of one of the most terrifying waves of contagious disease in recorded history.
The virus that caused the 1918 Spanish flu pandemic probably came from China, not Spain. It killed about 675,000 people in the United States from 1918 through 1920, and more than 50 million worldwide. The virus wiped out about 0.7 percent of the U.S. population, and 1 percent to 5 percent of the world’s population.
Scientists still aren’t sure why the 1918 flu was so deadly, or how well they could handle the same strain of flu if were to appear today.
In 1918, “health insurance” was really disability insurance. It existed mainly to protect workers against the loss of the ability to work, not to pay medical bills. But life insurance was already common, and life insurance claims poured in soon after the pandemic started.
The 1918 flu was harder on working-age adults who were likely to carry life insurance than it was on children or older people, and that made it especially hard on life insurers.
National Underwriter ran stories about life insurers struggling to keep enough of their own employees healthy to pay the policyholders’ death claims. But life insurers did come up with the cash to pay their claims.
The pandemic has shaped how physicians and insurers see contagious disease risk ever since. Even today, reinsurers still talk about a “pandemic similar to the Spanish flu pandemic” as an example of the kind of health catastrophe that a life insurer or health insurer must be prepared to handle.
In 2013, Boston-based AIR Worldwide, a risk analysis firm, estimated that an equivalent pandemic that occurred today might cost U.S. life insurers about $15 billion to $28 billion.