The Rise and Fall of Fraternal Methods of Social Insurance: A Case Study of the Independent Order of Oddfellows of British Columbia Sickness Insurance, 1874-1951

Since the depression of the 1930s, Canadian and American workers have relied upon employers and governments for solutions to problems of economic insecurity brought on by illness, accident, unemployment, and old age. In the case of sickness insurance, 86% of Canadian paid workers who were sick for two or more weeks over the period 1978 to 1981 received compensation for lost wages through either employer provided insurance or compensation, unemployment insurance, or Workmen's compensation [12]. This is in stark contrast to the pre-Depression (pre-1930) period when millions of Canadian and American men received sickness and health insurance through membership in voluntary organizations such as fraternal orders, trade unions, and work-place based mutual benefit societies. Members of these institutions typically received cash benefits when they were sick and unable to work and had access to the services of a physician. While the evolution of contemporary social insurance arrangements coincides with the decline of fraternal insurance arrangements, we know very little about the causal relationship between the two. Why did workers stop providing their own insurance and turn to employers and governments after the Depression but not before? Why were paternalistic social welfare arrangements that had been proposed since the late nineteenth century only embraced after the Great Depression? Were these arrangements supply side developments imposed by social engineers? Did previously indifferent employers and governments become benevolent and paternalistic following the experience of the 1930s [8]? Was the rise of the welfare state a response to growing demand of workers who abandoned the existing arrangements which were inherently non-viable [1]; or as Buffurn and Whaples speculate, had fraternal insurance become less viable boosting the growth of market insurance, and ultimately state provision of insurance [2]?