Flying is one of the safest ways to travel today. On average, there are 28,000 commercial flights every single day in America, which ferry nearly three million passengers to their destinations. For the vast majority of the time, each and every one of those flights would arrive without incident. But this wasn’t exactly how flying used to be, and, in the 1960s, passengers were so scared to fly that insurance companies came up with a wild idea. Decades ago, you used to be able to spend a couple of dollars at a vending machine at the airport to insure your life for your flight. One of the reasons why these machines are gone might not be what you’re thinking, either.
One of my guilty pleasures is the air disaster flick. I’ve watched the Turbulence trilogy, Sully, and Flight more times than I’m willing to admit. Last night, I also finally completed watching the entire Airport saga by watching the movie that started it all, 1970’s Airport. This film was a trailblazer in popularizing the air disaster genre, even though the movie didn’t even start building up the disaster until about halfway in. The disaster itself didn’t take place until nearly the end of the two-hour, 15-minute slog. The movie makes up for the time with its beautiful bare aluminum Boeing 707s and wonderful late 1960s cars.
If you haven’t seen this 56-year-old movie and are concerned about spoilers, skip on. Otherwise, there was a part of the film that took me by surprise. The disaster part of the plot hinges on a man who was at rock bottom and was desperate to provide for his wife. To give her all of the money she’ll need, the man wires up a bomb, places it in a briefcase, and rushes to the airport. When he arrives, he buys a life insurance policy at a kiosk right before his flight. The idea was that he’d blow up the plane, everything would look like an accident, and his wife would get the payout.
I initially thought that this had to be some Hollywood movie magic being worked into this film so that the plot made sense. Admittedly, the first time I ever flew on a commercial flight was in 2016, and this movie was made more than two decades before I was born. I was surprised to find out that, yes, insurance companies really did sell life insurance policies to scared passengers on their way to board flights. Even wilder is that Airport‘s crazy plot? That more or less happened in real life more than once! Let’s look into the once wacky world of so-called flight insurance.
Crashes Used To Be More Common
Aviation wasn’t always as safe as it is today. In the early days of aviation, crashes weren’t just common, but they were almost expected. Engines weren’t reliable, aircraft structures sometimes failed, and navigation was primitive. Those old propeller-driven planes also couldn’t fly above the weather, weren’t pressurized, and had few redundancies. Even the iconic Wright Brothers technically crashed their plane before their first actual successful flight.
At first, putting more planes into the sky didn’t help much. According to the Mackinac Center for Public Policy, in 1929, there were 24 known fatal crashes of commercial aircraft in America. It wasn’t just a bad year, either. Reportedly, in 1928 and 1929, the commercial aircraft accident rate was about one crash per one million miles of flight.
Such a rate would be unconscionable today. Airlines in America currently fly around 8.1 billion miles per year. If the planes of today crashed at the same rate as the planes of the 1920s, that would be the equivalent of 8,100 commercial airliner crashes a year. Yet, the 2025 mid-air collision of American Airlines Flight 5342 and an Army helicopter was the first major crash of a commercial airliner in America in 16 years.
That’s how far aviation safety has come. You have a far greater risk of getting harmed in a car crash on the way to the airport than on the plane itself. Sadly, as some aviation fans say, aviation safety and regulations are written in blood, and the industry had to learn a lot of hard lessons to get to where it is today.
Flight Insurance
It’s understandable, then, that many airline passengers of the first half of the 20th century were scared to board a plane. Travelers Insurance claims to be one of the first companies to insure a passenger against air accidents. On May 6, 1919, President Woodrow Wilson was given “ticket number one” by Travelers in France, which insured his travel. Apparently, Wilson probably didn’t board a plane, and thus never got the chance to use the ticket.
In the early days of flight insurance, an airline would work out a deal with an insurance company, and then the airline ticketing agents would offer the insurance as an upcharge when passengers bought their boarding passes.
After World War II, flight insurance would take off as its own monster of a business. Instead of partnering up with airlines, the insurance companies would sell policies right out of booths and vending machines installed at the airport. These policies were marketed as giving travelers peace of mind on their flights, but it was also a way for insurance companies to rake in additional revenue.
One of the masterminds of this new strategy was John M. Shaheen. As the New York Times writes, Shaheen served in the Navy during World War II. There, he was attached to the Office of Strategic Services, which ran clandestine operations. In 1947, Shaheen came up with an idea to revolutionize the sales of flight insurance. He founded Tele-Trip Insurance, and its calling to fame was selling life insurance out of vending machines at airports. Now passengers could purchase life insurance for their flight with quarters as easily as they purchased other small objects from vending machines.
The brilliance of the booths and vending machines was how easy the policies were to obtain. A vending machine didn’t make sure the person buying the policy was who they claimed to be, depending on the insurance company, each quarter gave you a specified amount of insurance coverage. For example, the Continental Insurance Companies had vending machines that offered $7,500 of coverage per quarter, up to 10 quarters. You could then buy multiple policies for the same trip if you wanted to, for a maximum of $300,000 of coverage.
The process was simple. You dropped your quarter in the machine, filled out the application, and then pressed a button to get your policy. You’d then drop that policy in a mailbox at the airport before boarding your flight. These policies had numerous catches. The most important thing was that the policy covered just the duration of a one-way or round-trip itinerary. So, if you got injured or killed in any other situation, this policy didn’t touch it. The insurance also covered only trips on scheduled airline carriers. If you died in a general aviation aircraft, in a flight operated by a “non-scheduled” carrier, a charter flight, or some other situation, you weren’t covered.
Lachs v. Fidelity & Casualty Co. of New York, 306 N.Y. 357 (1954), detailed what the application might say on a policy dispensed from a vending machine:
“I hereby apply to Company named below for Airline Trip Insurance to insure me on one Airline trip between: Point of Departure? ____ Destination? ____ And return ____ Beneficiary’s home? ____ Beneficiary’s Street Address? ____ Beneficiary’s City? ____ Beneficiary’s State? ____ Name of Applicant (please print) Signature of Applicant”.
The business of selling flight insurance would become marginally profitable, and Mutual of Omaha would purchase Tele-Trip Insurance in 1954. Meanwhile, pilots pushed back. Aviation was getting safer practically every year. By the 1940s, Mackinac Center for Public Policy notes, the average number of crashes per year had fallen to around five to 10 crashes per one million miles of flight. By the 1970s, advancements in air safety had gotten the average down to less than five crashes per one million miles of flight.
To pilots, the advertised need to purchase flight insurance was overblown. Yet, that didn’t stop the insurance companies from offering the vending machines and it didn’t stop passengers from scooping up policies.
Just how nutty did it get? Take this paragraph from Insurance Business Magazine:
The trend became so prominent that one 1963 lawsuit alleged, “In recent years air trip travel insurance has developed into a business of tremendous volume. For example, a recent annual report filed by a group of underwriters who handle a large portion of air trip insurance business in the United States, showed total premium collections for the year to be $3,382,561. In the same year the group wrote air trip insurance for $84,564,025,000 and paid out $1,388,839 in losses.”
While insurance companies raked in cash, a lot of it would go to the airports, which took a cut in concession fees. Still, even after the airport got its money, the machines were still profitable for the insurance industry. Aside from Tele-Trip Insurance, another big name in the insurance machine business was Fidelity & Guaranty Co. of New York.
The Dark Side Of Insurance Vending Machines
The business of selling insurance right before a flight also came with an unfortunate downside. Those looking to commit insurance fraud now had a new way to do it. If you insured yourself or a family member before a flight and then blew up the aircraft, you or your loved ones would get paid, provided the insurance company didn’t figure out your scam.
The risks of insurance fraud were well-known even in the early days of the flight insurance vending machine. On November 1, 1955, United Air Lines Flight 629 departed Stapleton Airport in Denver, Colorado, bound for Portland, Oregon. The aircraft, registration N37559, was a Douglas DC-6B with 44 people onboard, and it would never reach its destination. Barely 10 minutes after departure, an explosion rocked the aircraft, and it crashed into a field near Longmont, Colorado, killing all onboard.
The Civil Aeronautics Board, United Air Lines, and the FBI would discover that the aircraft itself was in operational condition, and it wasn’t a mechanical or structural issue that brought the aircraft down. Instead, something inside the aircraft exploded. The investigation revealed that nothing flammable or explosive was reported to have been shipped in the aircraft’s cargo hold. The extensive damage also suggested that no component from the plane itself was the source of the explosion. So, how did something blow up on the plane?
The Federal Bureau of Investigation explains what happened next:
A considerable quantity of personal effects of passenger victim Daisie E. King was recovered form the wreckage and closely examined by the agents. This material included a number of personal letters, newspaper clippings about her family, a personalized checkbook, $1,000 in traveler’s checks, an address list, and two keys and a receipt for safety deposit boxes rented by Mrs. King. These articles revealed considerable information about the background of Mrs. King.
One of the newspaper clippings reflected that her son, Jack Gilbert Graham, had been charged with forgery by the Denver County District Attorney and had been placed on the local “most wanted” list by that office in 1951. From the fact that most of these personal effects of Mrs. King were found on or near her body, it was apparent that she had been carrying them in her personal handbags at the time of the crash rather than in her luggage. Despite careful searching, practically none of the contents of Mrs. King’s luggage was recovered, and only small bits of the suitcases believed to belong to her were found.
Immediate effort to determine the identity of passengers on which large amounts of trip insurance had been obtained revealed that six passengers had a maximum of $62,500 of such insurance; four had $50,000; two had $37,500; one had $35,000; two had $12,500; and two had $6,250. Because of a holiday weekend, however, a complete check of all companies writing such insurance was not possible at once, and among policies located later were three on the life of Daisie E. King.
The investigation would find that Graham took out a duplicate insurance policy on his mother valued at $37,500. He would later admit to placing 25 sticks of dynamite into his mother’s suitcase to bring down the aircraft and cash in on his mother’s death. Graham had also insured his mother’s restaurant before blowing that up, too. At the time, the idea of someone intentionally blowing up an aircraft was such an anomaly that America didn’t even have a specific law to cover it. Apparently, Graham had a grudge against his mother for placing him in an orphanage when he was a kid.
The state of Colorado responded to the result of the investigation by banning insurance vending machines in airports.
Graham’s actions would not be the last time someone would use insurance purchased at an airport to cause mayhem. In just the decade following this incident alone, at least three more fatal crashes were caused by people committing insurance fraud by blowing up flights. Of course, insurance-fraud-related crashes would become so infamous that they inspired the novel Airport and the subsequent film.
The Fall Of Flight Insurance
Yet, insurance companies were undeterred and kept selling the policies, anyway. You’d think that the chances of blowing up in an insurance fraud incident would have brought an end to the flight insurance vending machine, but it didn’t.
Instead, as Insurance Business Magazine writes, it was simply the fact that aviation kept getting safer. Insurance companies kept the machines around through the 1970s, but they began to fade in the 1980s as flying became far safer and the public began realizing that flying wasn’t nearly as dangerous as it used to be. Those who still feared flying also found that they could obtain other life insurance policies that covered plane crashes. Likewise, credit card companies also offered their own coverage.
In other words, people simply stopped buying the policies. Those who were scared to fly had no reason to buy insurance at the airport anymore, and everyone else didn’t care. The machines became obsolete. Apparently, you might still find one of these machines in some parts of the world, but they’re certainly an anachronism.
That’s not to say that flight insurance is totally gone. Nowadays, instead of selling you a temporary life insurance policy, companies will sell you “travel insurance,” which might cover injuries, trip cancellations, lost luggage, delays, and other losses. Travel insurance is a multi-billion-dollar industry, too. But, thankfully, it doesn’t come attached to the fear of going down in a Boeing 737.
Another Obscure Part Of History
I know this is merely a review for some of our older readers. But, for someone who has grown up in this modern era of aviation? Honestly, it blew my mind. It’s wild to think that some people were so scared of flying that they wouldn’t board a plane without throwing some quarters in a vending machine. But I suppose it made sense. Planes did crash more often back then, and people didn’t want to leave their families with nothing if they died.
The flight insurance vending machine is one of those pieces of history that’s sliding into obscurity today, alongside hits like the payphone, the pager, and the floppy disk. That’s why I’m happy that places like the National Air And Space Museum exist and collect artifacts like these. If it weren’t for people preserving history, my jaw would still be on the floor.
The fact that these machines are gone is a good thing. The next time you board a flight, you can rest assured that over a century of safety innovation will almost certainly get you to your destination safely. Now, airport vending machines can be left to jobs like replacing those headphones you forgot at home.
Topshot graphic image: Boeing/National Air And Space Museum
The post Decades Ago, People Were So Scared To Fly On Planes That Companies Sold Life Insurance Polices Out Of Vending Machines At Airports appeared first on The Autopian.
