AFLAC - Insurance Company - Complete History and Analysis of Insurance Giant with Investment Recommendations

History of the Firm In 1955, the American Family Life Assurance Company, know as AFLAC, was founded by brothers John Paul and Bill Amos. The firm's home was in Columbus, Georgia, where the corporate office is still located today. AFLAC was primarily a life insurance company until it introduced a cancer expense policy in 1958. In the 1980's the company began to expand its lines of business to include accident/disability, short-term disability, hospital intensive care, hospital …

…short in the event of a payout. As a result the firm would have to draw down its reserves and net worth in order to meet the claim. So in theory, the best way for an insurance company to immunize would be by working with individual portfolios. But, this process is time consuming and costly. Instead of direct portfolio balancing, AFLAC could take hedging positions in derivative securities markets such as futures and forwards markets.