The compulsory insurance has not been in operation long enough in any of the organizations for its full effect to be seen.  It is certain that as the unions grow older they must materially raise the rates at which they issue insurance.  The rapid growth in membership has brought into all the unions in this class in recent years a proportionately large number of young men.  The limitation on the age of the insured has contributed to this result.  As these members grow older, the death rate will increase.  As has been noted above, however, it has not been primarily the cheapness of the insurance but the combination of death and disability insurance which has been the advantage possessed by the union systems.

The primary purpose of the insurance features of these organizations is to obtain for the members and their families a higher degree of economic security.  The two great economic contingencies against which the railway organizations provide insurance are, first, the loss to a family in consequence of the death of the income-earning member, and second, the economic hardship involved in shifting from one industry to another made necessary by certain severe physical accidents.  Insurance paid to the totally disabled employee, or to the family of a deceased member, is frequently the means of maintaining the standard of living of the unfortunate family.  The risks to which the railway employee is exposed are due to the nature of the trade, the negligence of a fellow workman, or the negligence of the employers.  Compensation for only the last class is given by the law.  Against the other two kinds of accident the railway employee must himself make provision, and this provision is amplest and surest when made by insurance.  The organizations, as we have seen, have never entirely subordinated the idea of benevolence to the principles of business.  In the early years of its history, each grand convention set aside large sums for charitable payments.  Before the adoption and satisfactory operation of the Engineers’ insurance system, it is estimated that eight tenths of the husbands and fathers of those who applied for charity were uninsured.[86] Purely charitable relief was found inadequate and the present systems represent a compromise between charity and business.

[Footnote 86:  Locomotive Engineers’ Journal, Vol. 22, p. 33.]

The insurance features have further been the means of securing and retaining members and thus building up these trade organizations as factors in collective bargaining.  The power of the brotherhoods to secure satisfactory agreements with their employers is largely measured by the strength of the organizations, and that strength is usually in direct proportion to the development of their insurance systems.  Thus not only is insurance a prime support in the collective bargaining of the unions, but it insures control in the exercise of that function.  The infrequency of railroad strikes may be attributed largely to the almost perfect control of the head officials of the brotherhoods over their membership.