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How Did Insurance Work For Bankruptcy?
What is the story behind the American banker insurance company of Florida? It began in 1940, when Florida was in the grip of the worst economic turmoil of the post-Second World War times. Many Americans who had family possessions in the old stock exchange building on the Panhandle began to flee Florida as they saved their homes. When the doors to these refuge-like buildings first opened, many investors became greedy and some investors tried to make a run for it as some kind of illegal pyramid scheme.

Banker's insurance of Florida was a complicated scam, which did not really pan out like the company promoted. As soon as word got out that there might be money to be made with this sort of scheme, illegal brokers started showing up everywhere. Some of them turned out to be actual criminals. Insureinfoq were just pretending to be legitimate brokers.

It was the end of the American investor. The company was taken over by the Cabot Brothers who changed the name to American Banker Insurance Company of Florida. They would also change the address from Ft. Lauderdale to Sarasota. It all happened just before Hurricane Charlie hit South Florida.

The new company was started with the plan of paying out "dividends" to shareholders of the bank. These shareholders would receive their dividends in cash, shares or other assets held by the bank. In order to make it appear as if there was actual investment by American bankers in the company, the bank would set up brokerage firms that would put the names of accredited investors on the A.D. Statements filed with the Securities and Exchange Commission.

The way that all this worked was that there would be an A.D. certificate issued by an "insider." broker that would vouch for the account of the investor. This was all being done in the name of helping American depositors. Of course, the bankers never had to make a dime off of this arrangement because the dividends were paid out to them as a form of insurance for their own safety. They knew that the insurance company would pay out should there be a total collapse of the insurance company, which there was, because the bank's capital was invested in other forms of projects.

As time passed, other insurance companies would start offering dividends to the shareholders of the original bank, but this would not be as large of a payout. What American banker insurance of Florida did was they made sure that there were a minimum of twenty shareholders for every hundred thousand dollars in accounts. If there were less than that, then dividends would equal one-fifth of the yearly income of the company. This would keep the bankers happy, but it was good for the rest of us, the consumers of the company.

The insurance company of Florida went through more drastic changes, but their aim was still the same. Make sure that you got enough money set aside in case something happened, or in case you lost everything. The first part of the law is that there must be some sort of an insurance plan in place for the account holders of the company. After that, the law would say that those who have a life insurance policy on their person at the time of the event would be given first priority.

If the company was not providing any kind of insurance, then the person in charge of paying it out would be the account holder. American bankers were very careful to make sure that this rule of law was observed, so there would be no problems. There were special policies for families and also policies for people of certain ages. Those with young children would be given special attention, because they would be most likely to die if they were left without insurance.