The Atlanta Life Insurance Company, with headquarters on Atlanta’s historic Sweet Auburn Avenue, has been in existence since 1905. Founded by Alonzo Herndon, a prosperous Black barber and entrepreneur who rose from enslavement to become by 1927 the wealthiest African American in Atlanta, Atlanta Life is the leading African American stock-owned insurance company in the nation. As one of the strongest Black financial institutions to emerge in the early twentieth century, Atlanta Life is a premier example of the quest of African Americans to gain an economic foothold.
A Noble Endeavor
Atlanta Life began as a small insurance association with a capital investment of $5,000. For many years it operated as a mutual assessment enterprise. The policyholders, exceeding 23,000 by the end of 1909, provided the majority of the revenue through premium payments and periodic assessments. The company offered one contract, an industrial health and accident policy, which paid a small sum upon the death of a policyholder. In 1916 the firm strengthened its financial base by becoming a stockholder organization. Using his personal resources to support the enterprise, Herndon purchased approximately 90 percent of Atlanta Life’s stock.
As founder and first president, Alonzo Herndon’s leadership of Atlanta Life blended ideals of racial self-help and independent entrepreneurship. He belonged to the group of Black capitalists whose activities transformed mutual aid and benevolent societies, church organizations, secret associations, and other social endeavors into more-efficient business operations. Influenced by Booker T. Washington and the movement to expand Black business involvement, Herndon joined men like John Merrick, organizer of the North Carolina Mutual Insurance Company of Durham, North Carolina, and Samuel Wilson Rutherford, founder of the National Benefit Insurance Company in Washington, D.C., to solidify the link between mutual aid and capitalism.
Formore than two decades Herndon’s leadership paved the way for the development of a company with far-reaching impact on the economic and entrepreneurial development of the Black community. From the beginning Herndon viewed his investment in Atlanta Life as an opportunity to provide a valuable service to policyholders. Too often families were cheated by insurance firms that promised large benefits but found numerous loopholes to avoid a paying a claim, and occasionally a firm failed when an employee absconded with the company’s funds. Financial solvency and promptness in paying claims were key features of Atlanta Life’s operating philosophy. The company started business in an era of white supremacy, racial animosity, and social proscriptions. Nevertheless, its executives were steadfast in their resolve to maintain a strong company and to promote first-class citizenship for African Americans.
In 1922, in an effort to provide greater safety and independence, the company increased its capital stock to $100,000 and became a legal reserve company. As such, Atlanta Life joined a select group of African American insurance companies that included Mississippi Life, Standard Life (also based in Atlanta), North Carolina Mutual, and National Benefit Life. After this success the company experienced rapid expansion, entering more than half a dozen new states, boosting policy sales, and placing Atlanta Life products with clients as far away as Texas and Kansas. In 1925, with about $19 million of insurance in force, the company carried approximately 13 percent of the total $141 million of insurance held by the eight leading Black insurance companies in the nation.
The Character of Enterprise
Herndon died in 1927 and was succeeded as president by his son, Norris, a graduate of Atlanta University and Harvard University. Groomed by his father to assume the reins of Atlanta Life, Norris Herndon led the firm for more than four and a half decades. His tenure was characterized by cautious growth, prudent investments, sensible management, and careful economies that permitted few frills. The sales area expanded from nine to eleven states, assets increased to almost $54 million by 1960, and insurance in force grew to $176 million. When Norris Herndon retired in 1973, the company’s financial standing showed $84.5 million in assets and more than $346 million in insurance in force.
Norris Herndon believed that even in postwar America Black businesses remained vulnerable to the adversities of a segregated society. In 1950 he created as a memorial to his parents the Herndon Foundation—a nonprofit corporation to which the controlling shares of stock would be bequeathed at his death. The earnings of the foundation were earmarked for religious, educational, scientific, and literary purposes. The establishment of the foundation also ushered in an era of support for the increasing efforts of African Americans to secure civil rights, economic dignity, and progress in general. Atlanta Life supported the growing protest movement in the 1950s by offering employment to fired teachers, posting bail for jailed students, and providing meeting space and printing and communications facilities to civil rights groups.
Leadership and Service for a New Era
Norris Herndon was replaced as president by Jesse Hill, a University of Michigan graduate and company actuary. Hill’s appointment and the formation of a new executive team signaled a change for the company. For the first time, a family member was not guiding the firm, and the company continued to demonstrate financial growth and social responsibility. The agenda for the new era stressed efficient methods, attractive portfolios, new acquisitions, and new markets. Atlanta Life also continued to provide leadership in improving the quality of life for African Americans.
In 1992 Hill retired after twenty years as the organization’s head. The presidency then passed to Don M. Royster Sr., and later, Charles H. Cornelius, the firm’s fifth chief executive officer, led the firm into the twenty-first century. Nearly 100 years after its founding, Herndon’s company remains an example of African American financial achievement. In April 2001, as the firm’s centennial approached, it adopted a new direction as a financial services organization and a new name, the Atlanta Life Financial Group.