- Get Involved
REPUBLIC FINANCIAL SERVICES
REPUBLIC FINANCIAL SERVICES. Republic Financial Services, also known as the Republic Fire Insurance Company of Texas and the Republic Insurance Company, headquartered in Dallas, offers property and casualty insurance to customers throughout the United States. The company grew from the efforts of three brothers, Ike, Edwin, and George Jalonick. Ike and Edwin graduated from the University of Texas at Austin and ran their father's Wichita Falls hardware business before entering the insurance industry. When homesteaders began a race for cheap land in Oklahoma's Indian Territory north of Wichita Falls, the brothers sold their business and followed, moving to what is today El Reno. Ike opened a fire insurance agency, and Edwin worked as a bank cashier. When Ike became involved in a dispute with a known bank robber who threatened to kill him over a piece of land, the two brothers moved in 1893 to Dallas, where Ike worked for Continental Insurance Company of New York and Edwin became a Texas special agent for Hartford Fire Insurance Company. In 1881, meanwhile, George moved to Abilene, where he bought an insurance agency and worked as a representative of the Equitable Life Assurance Society. His experience in organizing the local volunteer fire department and serving as its chief taught him about fires and their prevention, and he eventually decided to shift from life insurance to fire insurance. Traveling by horseback, he convinced owners of the importance of covering their properties with fire insurance. In 1888 he moved to Dallas to become a special agent for Dargan and Trezevant, and in 1889 he became a special agent for Continental in Texas, Louisiana, and Arkansas. Three years later George left to form the Texas Inspection and Rating Bureau, the equivalent of today's Fire Insurance Division of the Board of Insurance Commissioners, which writes rate books for fire insurance in the state. Ike helped to draft legislation leading to the establishment of a State Fire Rating Board, and the brothers drafted legislation leading to the formation of the State Insurance Board. In 1899 George served on the Cleaner Dallas League and in 1902 became president of the board of education. In that year he and Col. William A. Childress formed the Southwestern Life Insurance Company, whose slogan was "We are going to give Texas people a chance to keep Texas money at home." Following Edwin's death in the Galveston hurricane of 1900, Ike Jalonick formed the Commonwealth Fire Insurance Company of Texas in 1903. The company's first customer was the Dallas Morning News Building. The new firm, with Ike as its president, promised that all losses would be paid promptly in cash without discount. His refusal to approve a rate increase mandated by East Coast insurers in 1904 marked the start of state-controlled insurance rates in Texas.
When the Austin Fire Insurance Company of Austin suffered heavy losses following the San Francisco earthquake, Jalonick acquired that firm, combined it with his own, and moved the new enterprise to Dallas's Highland Park. After he acquired International Fire Insurance of Fort Worth in 1912, the three companies together came to be known as "The Little Texas Companies." After successfully responding to a disaster that burned Paris, Texas, virtually to the ground, the three companies consolidated as the Republic Fire Insurance Company of Texas in 1918, later to become the Republic Insurance Company, as new services were added. At that time, Republic was the only fire insurer in the state offering shares to stockholders. George, the oldest Jalonick brother, headed the new firm, with Ike as his vice president. By 1921, when company agents first reached clients by car, Republic led all other companies in earnings on investments. In 1924 the firm rated ahead of eighty-nine foreign and American companies with the highest percentage of underwriting profit and lowest combined loss and expense ratios. At the onset of the Great Depression, Globe Underwriters Exchange of New York purchased a controlling interest in the Republic but did not change its management. Ike Jalonick resigned as president in 1930 and died in 1933, leaving A. F. Pillet, who had worked at the firm for twenty-three years, to carry on as president. Investments plummeted, but Republic now began to expand to the East Coast and Midwest, eventually opening an Eastern Department in New York City. Faced with increasing automobile transportation, the company responded to a suggestion by board member Kenneth D. Steere, a partner in Paine, Webber, and Company of New York and a Globe underwriter, and established a finance company that would permit agents to finance automobiles when they wrote auto insurance. The Allied Finance Company, begun in 1939, dealt in auto insurance. Business growth produced physical growth as well in 1939, when the firm bought property for a new building and moved to Turtle Creek Boulevard in Dallas. Further diversification occurred in 1941, when the company added an Inland Marine Department to provide insurance on personal property against theft.
As the United States entered World War II, Pillet resigned and was succeeded by Hugh H. Gaffney, under whose administration Republic assets increased nearly six times. By 1945 company authority was decentralized to give local managers more authority. In that year Republic established the Republic Indemnity Company, a subsidiary to cover automobile insurance. At the same time Allied Finance entered the credit life insurance business by starting the Industrial Life Insurance Company, and in 1947 the Southern Insurance Company began automobile accident coverage for physical damage. The Eastern Department experienced increasing financial difficulty after 1945, particularly after a 1950 hurricane that produced 26,000 claims, but Republic Casualty, founded in California in 1950, operated in twenty-seven states by 1954. In the 1960s Russell H. Perry, a former Eastern Department officer who began with the company in 1932, replaced Hugh Gaffney after his retirement and continued to expand the firm. In 1964 Republic formed Republic-Vanguard Life Insurance Company to offer life insurance to its homeowners policyholders, and by 1971 the company formed Republic Financial Services, a holding company, to monitor its twenty-six subsidiaries and the Allied Finance Company. In the early 1980s Republic battled a hostile takeover attempt by Reliance Insurance Company, but ultimately completed a deal with Winterthur United States Holdings, representing an insurer founded in 1875 at Winterthur, Switzerland. W. C. Hassard replaced Perry in 1984, and Harry W. Wilcott followed Hassard in 1988. In this period the company adopted a new strategy that moved it away from volume toward higher profitability and acquired another firm to manage its business in Texas and New Mexico. Wilcott initiated a company newsletter, the Republic Leader, and improved the firm's bookkeeping technology. The company discontinued its life insurance business to concentrate on property and casualty insurance, reorganized its field offices, and in 1993 sold its Allied Finance unit to the Associated Corporation of North America, a Ford Motor Company unit. In that year Republic celebrated its ninetieth anniversary.
BIBLIOGRAPHY:Dave Clark, The Protectors (Dallas: Republic Financial Services, 1978). Russell H. Perry, Republic Financial Services, Inc. (New York: Newcomen Society in North America, 1976).
Image Use Disclaimer
All copyrighted materials included within the Handbook of Texas Online are in accordance with Title 17 U.S.C. Section 107 related to Copyright and “Fair Use” for Non-Profit educational institutions, which permits the Texas State Historical Association (TSHA), to utilize copyrighted materials to further scholarship, education, and inform the public. The TSHA makes every effort to conform to the principles of fair use and to comply with copyright law.
For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml
If you wish to use copyrighted material from this site for purposes of your own that go beyond fair use, you must obtain permission from the copyright owner.
The following, adapted from the Chicago Manual of Style, 15th edition, is the preferred citation for this article.Handbook of Texas Online, Thomas Matthew Aycock, "REPUBLIC FINANCIAL SERVICES," accessed July 19, 2019, http://www.tshaonline.org/handbook/online/articles/djruq.
Uploaded on June 15, 2010. Published by the Texas State Historical Association.