Celebrating Benjamin Franklin on Independence Day, July 4th

Benjamin Franklin played an important role in the Declaration of Independence, the formation of the American insurance industry, and was a leading proponent of better firefighting efforts to protect communities. I have previously made mention of Franklin’s insurance role in Benjamin Franklin is the Father of American Insurance.

Franklin organized Philadelphia’s first volunteer fire department, the Union Fire Company, in 1736 after the city suffered a devastating fire at Fishbourn’s Wharf in 1730. The fire started on a ship and spread to Fishbourn’s Wharf on the Delaware River in Philadelphia. All the warehouses on the wharf burned, as did three neighboring houses. The damage was extensive.

After the fire, Franklin noted that if people had access to good fire engines and equipment, the fire likely could have been contained. This made the need for better fire protection clear.

Dissatisfied with the city’s fire preparedness, Franklin began advocating for a community-based volunteer fire organization to help fight fires and protect property.

In 1733, Franklin published an article in his Pennsylvania Gazette about the need for a better organized fire protection service in Philadelphia, modeled after Boston’s Mutual Fire Societies. Showing that he was a doer and not just a complainer, Franklin then co-founded the Union Fire Company, Philadelphia’s first volunteer fire department, nicknamed the “Bucket Brigade,” in 1736. The Union Fire Company differed from Boston’s model in that it protected the entire community, not just its own members. Twenty-six volunteers signed on as initial members, each equipped with six buckets and two linen bags. They had different roles, like water management, property protection, training, and fire prevention. The Union Fire Company’s success inspired the formation of additional volunteer fire brigades, greatly improving the city’s ability to quickly put out fires while minimizing property damage.

In 1752, Franklin co-founded the Philadelphia Contributionship, which provided fire insurance for houses. It was the first fire insurance company in America. This has earned him the title of “Father of American Insurance.” The company operated on the principle of mutual insurance, where policyholders were also the owners, sharing in profits and losses.

The Philadelphia Contributionship set new standards for building construction, as it would not insure properties it deemed fire hazards. Its criteria evolved into some of America’s first building codes and zoning laws. Franklin pioneered key concepts of property insurance, such as risk-based premiums, building inspections and standards, and a financial reserve fund to pay claims – ideas still central to the modern insurance industry.

In 1759, Franklin also helped found the Presbyterian Ministers’ Fund, the first life insurance company in America. The Presbyterian Ministers’ Fund was created by the Presbyterian leaders in Philadelphia and New York. Its original name was the Corporation for Relief of Poor and Distressed Widows and Children of Presbyterian Ministers. The fund aimed to provide financial assistance and security to the widows and children of deceased Presbyterian ministers and missionaries. Early forms of life insurance were often started by religious organizations to protect the families of clergy members.

Franklin was instrumental in getting the company chartered and operational. The Presbyterian Ministers’ Fund was a very early example of a chartered life insurance company in the American colonies. It was one of the few life insurance enterprises that existed prior to American independence in 1776.

The company set an important precedent as a member-owned mutual insurance company. Policyholders contributed premiums into a general fund that would be used to pay benefits to the families of deceased members. In 2002, the parent company of the Presbyterian Ministers’ Fund was acquired by Nationwide Mutual Insurance Company after over 240 years in operation. This makes it one of the longest continuously operating life insurance companies in American history.

Regarding the Declaration of Independence, Franklin was a strong advocate for colonial independence. When he returned to America from England in 1775, he joined the Second Continental Congress and served on several committees that laid the groundwork for independence.

In June 1776, the Continental Congress appointed a Committee of Five to draft a formal statement declaring the colonies’ independence from Britain. Franklin was selected to the committee along with Thomas Jefferson, John Adams, Robert Livingston, and Roger Sherman. As a member of the committee, Franklin reviewed and edited Thomas Jefferson’s initial draft of the Declaration. One of his most significant suggestions was changing Jefferson’s phrase “We hold these truths to be sacred and undeniable” to “We hold these truths to be self-evident” – an edit that shaped one of the most famous lines in the document.

In my research, I was surprised to learn that the actual Declaration of Independence was not signed until August 2, 1776. So, why do we celebrate Independence Day on July 4? An article, “Are We Celebrating Our Independence on the Wrong Day?” noted the discrepancy:

On July 2, the Continental Congress voted for independence. John Adams, a delegate from Massachusetts, declared that July 2 would forever be remembered and celebrated yearly as the most important day in our nation’s history. It didn’t work out that way. For the next two days, the delegates carefully studied Jefferson’s draft. They changed the wording of some parts, deleted other parts, and added a few things. But overall, the work remained mostly Jefferson’s.