In 1880, and then again in 1882, tornadoes tore through the area of Hastings, Michigan, leaving death and destruction in their paths. These two storms left so much destruction—about $225,000 worth—that the monetary damage alone verged on a full-scale disaster. Daniel Webster Rogers, a farmer in Barry County, took more than a passing interest. With a background in mutual insurance as the secretary for the Farmers Mutual Fire Insurance Company of Barry and Eaton Counties, he began doing the research and background work to start a windstorm insurance company.
At the time, there was no law that would permit a mutual windstorm company to operate in Michigan. Rogers contacted the Iowa insurance department and discovered that Iowa had a mutual cyclone insurance company. He secured copies of the documents it used, including its charter and by-laws, and then with the help of Probate Judge Clement Smith, drafted a new law which would allow the creation of a windstorm company. Rogers’ brother, Jeremiah, was a state legislator, and he sponsored the bill which became Michigan law on February 25, 1885.
Assessment mutual insurance companies of the late nineteenth century were the purest form of cooperative activity for spreading risk. Member policyholders owned the company and each member had one vote to elect a board of directors and officers. Members were assessed a sufficient amount to pay claims and company operating expenses based on the total amount of coverage in force. With the new law in place, the groundwork was laid to create such a company in Michigan.