Entrepreneurship and Innovation in Automobile Insurance
Samuel P. Black, Jr. and the Rise of Erie Insurance, 1923-1961
Garland Studies in Entrepreneurship Series

Entrepreneurs play a central role in economic growth and development, but how they do so is the subject of considerable debate. This book explains that process through an historical case study of an automobile insurance entrepreneur, Samuel P. Black, Jr., and Erie Insurance, the company he helped build. It also recounts the largely untold history of American automobile insurance.

One of this study's central themes is the role of innovation in the entrepreneurial process. The rise of Erie Insurance from a four-person enterprise in Erie, Pennsylvania, in 1925 to the fourteenth largest property-casualty insurer today was the result, in part, of Black's relentless push to innovate. His continual efforts to cut costs, develop new products, satisfy customers, increase sales, and improve operations, all contributed greatly to the company's growth. A second theme is the automobile's dramatic impact on modern America. Its takeover of mass transportation provided the basis for the development of the automobile insurance industry and created many of the opportunities that Black and Erie Insurance capitalized on. These themes combine in the history of Black and Erie Insurance to illuminate the dynamic process by which the cultural, social, economic, and technological environment creates opportunities that entrepreneurs and entrepreneurial firms exploit, and how entrepreneurial actions stimulate economic growth.

Contents
Preface ix
Acknowledgments xiii
CHAPTER 1
Introduction: Entrepreneurship—Theory and Practice 1
CHAPTER 2
The Motor Age 37
CHAPTER 3
Getting Ahead 59
CHAPTER 4
The Romance of Claims 81
CHAPTER 5
“Push This Thing Along”: The Rise of Erie Insurance 99
CHAPTER 6
The Challenge of the Depression 127
CHAPTER 7
Adversity and Innovation 163
CHAPTER 8
Sales, World War II, and Managing the
Northwest Territories 197
CHAPTER 9
Underwriting and Problems of Growth 231
CHAPTER 10
Questions of Strategy and Rewards

CHAPTER 11

Epilogue - Samuel P. Black Jr

Bibliogrpahy

Appendices

Index

Samuel P. Black is one of the pioneers of automobile insurance companies. John Paul Rossi is in the Department of Human and Social Sciences at Penn State University.