June 6, 2012
Holocaust insurance claims divide the Jewish community
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Indeed, Holocaust reparations have divided the Jewish community from the very beginning. In the early 1950s, negotiations with West Germany ignited violent protests in Israel. An iconic photograph shows Menachem Begin speaking at a rally in March 1952, with a banner below him reading: “Our honor shall not be sold for money; Our blood shall not be atoned by goods.”
Much of the negotiating was handled not by the Israeli government, but by the newly formed Conference on Jewish Material Claims Against Germany, better-known as the Claims Conference, a group formed by the leading Jewish organizations of the day. They became a sort of conduit for reparations payments from the German government to survivors.
Today, the majority of compensation for victims of the Holocaust flows through the Claims Conference, which, according to a 2010 report by Jeffrey Gruder to the British Board of Deputies, holds close to $3 billion in assets stolen by the Nazis from German Jews. Their approach to distributing funds to survivors and their heirs is top-down, like a government agency. Survivors can apply for various funds, such as the Hardship Fund, the Fund for Victims of Medical Experiments and Other Injuries, and Program for Former Slave and Forced Laborers.
Because she worked as a slave laborer in Auschwitz, Renee Firestone was a beneficiary of one of these programs—she received $2,000 from the Claims Conference in the early 2000s.
“They negotiated my claim,” she said, a tinge of anger in her voice. “Why? Who gave them the right to go to Germany and negotiate in our name?”
“How paternalistic do you want to be?” added her daughter, Klaire, even angrier. “They pay out in dribs and drabs, as if the survivors are not qualified to decide how to use the money.”
In the 1990s, it became clear that European insurance companies like Generali of Italy, Allianz of Germany and AXA of France were withholding payment on insurance claims on policies taken out by Jews in the decades preceding the Holocaust. In light of these reports, several states, including California, passed laws requiring insurance companies doing business in their state to disclose the names of policyholders. It also gave survivors a 10-year window from 1999 to 2009 to sue if the companies would not settle.
In response to the pressure from states, six insurance companies entered into negotiations with the Claims Conference to create a voluntary forum for resolution of victims’ insurance claims. The result was the International Commission on Holocaust-Era Insurance Claims (ICHEIC), formed in 1998.
It had been more than 50 years since the camps were liberated. In that time, international borders had been redrawn, governments had collapsed, insurance companies had been bought and sold and merged, records had been transferred from warehouse to warehouse. It was, in short, a mess. But even setting aside those difficulties, companies were reluctant to release the records they did have.
“Even though ICHEIC tried to get them to do it, some of the companies never published the full names of policy holders,” said Sidney Zabludoff, an economist who worked as a consultant to the Claims Conference in ICHEIC.
By the time ICHEIC closed its doors in 2007, less than 3 percent of more than 550,000 outstanding policies sold to Holocaust victims were paid, and Zabludoff estimates that in today’s dollars, there remains roughly $20 billion in policies still owed to European Jews and their heirs.
“ICHEIC did not work well,” said Michael Bazyler, a professor of law at Chapman University. “It was basically an organization run at the mercy of the insurance companies. ... There’s injustice in every one of these [Holocaust restitution] settlements. But this one sticks out like a sore thumb, because of the low percentage of payouts based upon the number of claims.”
Douglas Davidson, the State Department’s Special Envoy for Holocaust Issues, disagrees. In a November 2011 memo to the House Foreign Affairs Committee, he wrote, “ICHEIC engaged experts to investigate the incidence of life insurance policy ownership in prewar Europe. These experts concluded that the number and value of polices issued prior to World War II was far less than previous estimates had suggested.”
In the United States, insurance is regulated at the state level, and many state insurance commissioners were involved in ICHEIC. John Garamendi was California’s insurance commissioner, and he was not happy with how the process unfolded.
