A look back: Whatever happened to airport insurance vending machines?

Insurance vendors used to be commonplace in countless airport gates throughout North America. What happened to this form of pre-travel life insurance?

Insurance News


In 1985, the LA Times reported that business magnate John M. Shaheen passed away at age 70.
While Shaheen was best known for his accomplishments as President Richard Nixon’s ambassador to Colombia, as well as his leadership roles as president of an oil refinery and technical advisor to the Office of Strategic Services, he had one other claim to fame: founder of Tele-Trip Insurance, the vending machines that used to sell life insurance in airports throughout North America.
While still prevalent in countries such as Japan and Taiwan, back in the 1960s, it was not uncommon for North Americans to encounter vending machines that would sell life insurance policies for $2.50, paid in quarters, before embarking on a flight. Typically, these would come with a warning, such as:
“Do Not Purchase More Than a Total of $62,500 Principal Sum - Nor for Travel on Other Than Scheduled Air Carriers. This Policy Covers on One-Way Trip Only Unless Round Trip Ticket Is Purchased Before Departure."
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.”
As with any business operation, however, crooked opportunists began to find ways to undermine the system. In this case, the duplicity involved violence. Instances arose where Americans began to purposely release dynamite on planes in order to facilitate an insurance claim.
In one, a Denver businesswoman’s son hid explosives in a Christmas present, which detonated on her flight and resulted in the death of 39 passengers and five airline employees. He admitted to the FBI that he committed this crime for an insurance payout, and was thereafter executed in a gas chamber.
Over the next decade, “three more commercial flights would be blown up, and insurance fraud was the detonator for each,” according to Paul Talbot.
Although insurance vendors are no longer common in North American airports, domestic terrorism is not to blame. In fact, the business model simply depreciated because air travel came to be perceived as so safe and routine, it eliminated any demand for pre-travel life insurance.


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