Residential segregation by race in cities and the employment of blacks in insurance occupations during the early 20th century

Black entrepreneurs established viable insurance companies in the early 20th century, responding to the need to provide insurance to those black consumers who were rejected or mistreated by insurance firms owned by whites. Adding to this account, one study has proposed that black employment in the insurance industry was also encouraged by residential segregation by race. In the present investigation, a regression analysis of census data for 22 southern and 42 northern cities in 1940 finds modest support for this proposal. The rate of the employment of blacks as “insurance agents and brokers” was positively associated with an index of black residential segregation in northern cities only. Moreover, the rate of black employment in these insurance occupations was higher in southern cities, and there was indirect evidence that this higher rate may have resulted from an old tradition of insurance enterprise among blacks in the South.