Pacific Mutual Life's non-cancellable disability policies proved to be popular and disastrous during The Great Depression. With unemployment surging, the product became a financial drain, threatening the security of the company. Insurance Commissioner Samuel L. Carpenter proposed a bold blueprint for reorganization of the company. He endorsed a principle that already guided Pacific Mutual Life: primary concern for the interest of policyholders. Carpenter and the Pacific Mutual board provided that the company's life insurance policyholders were to be given the opportunity, through mutualization, to become the owners of the company.