, 1870-02-16

the counting Of future income among no
present ssseta Of the companies Tbs New
York Commissioner saJs: ........
Tnfrs are ,e-dsy American companies inst
ea.e ..iea au's so"o Toe 1s1sassnee reser1es 40
es,.i.al1, Ct ka', rna,ntatned, but tho ~asts1n,
eonnns.oss. " % nea,{ capsases ] salMles snd
mere reEfontl bec1Hnes or anticipated couuIs-
spps, the C!etriDE Ct coMDpted cpumNsspa8 -
&C ual asseta IN h4 tne gtr1ng Of percentages OF
ihan tte ieFl rate of intctra. ths declaration ~
<zetsstrt dss.d<ads b1srd mainly on uncoetd r..
asstft, ~ atsd fttfA or trt1rs re1eiutieA. Some
Of tbe purely prppt .tta5J compsu1e3 2se b; nc -
loE hele on Anene u SOL tne Eestsy once 10 /
vi. slox la,Ee po.tton 81 ihe capital to be
tun1 !n introducing acd rstaotit ming their oas
e. Ee:s Tne e1 Ia cone 70 esuse.so Ieueo: snd
their own hatdf, sud II these hands &re trcompe-
Tent N eutdt, &. D1sec ors rolcI nclders should
insi,snte REFORMS md ceaegsa Of administration
4. dhRttrta ,hc ln;ctuRstoI as Liza Assurance So
esesy Of Los DOR lr csses ot sceose ne csss5 thc
It, ct inlalpR legal procte 11nEs-a course which
win npt 1e tAEen -ithLct the nost careful prelm-
tperv scrutiny. AEd at'er sll ueho1a OF voluntary
II tfoEm hAsr been nshlduou4!I Pressed and recon.
NEEDED
His report shows that the total assets OF
the fftT-hve companies, resident and non
resident, issning policies in New
York, are $l7s ,274.2l, while thei1
policies amopnt to s1,s3G, ,o73.l 1887.
But Of these nssets Sbs,83a,57s.A, or
over Sc per cent Of tie @ho1e, are unreal
lied, j. e., uncollected being, IN fact,
credits to the Insured in theform OF unpid
premiums, deferred premiums, and pre-
MUM uotes- These credits arc not eligible
sosus, made with view to the security of
the loan, but grow out Of the fierce compe-
tlhon between rival companies, and their
consequent willingness to insure people at
their own expense, trusting TO the future
for the premium. They are not secuted,
do not represent money thht VIII ever paid,
but money which tho promisor ia unable
to pay Tho Eew York companies claim
the right to return thcae unoolleckod Wis
ionary hsze,s as par: Of their premium re-
serves nay, that they form about third
al those reserves, and have hitherto dous
80, though the Insurance Commissioner
Inns constantly exposed the weakness Of
such returns, by showing how much. OF
their nssats was realized or not, md COM
pafipg this with the required premium
reserve.
While be estimates the required premium
reserve at Sl2G.ois,779.4s, tho realized
assets amonnt only TO Slll+746,6 ,694-27,
leaving dsacieucy of Sl4.sol ,os5- g. In
asnuuh as, In the gross saseta above msu-
toned, the original cspttals, offices, and
furniture Of ths companies are included.
1h1ch cou'd not be used to pay their Losses
without an entlfe obstruction Of tha con1-
psn'es themselves II ii pla1n thats unisss
these unrealized aaEeta are counted IS part
a tie receives for payment Of pu'icy-
builders, the aggregate New York companies
are insosEert, after sinking their whole
stock capitals, by oves fourteen millions Of
dollars.
Ii tie solvency Of American lie insurance
is thus dependent On the ability Of the
companies TO realize unreallzed assets, the
complaint against the New York aud Massa-
chuse.ts State Insurance Departments will
not be that they mildly objected to such
condition Of thiuge, but that they did not
oppose it with an energy that would have
prevented its existence.
Including these uu1ealized assets tho com-
1anies show a surplus Of sac, ,5s3, ,4e3. %. %
lint an the s,me n1;ncjple thev might rush
;n,o !, credit bns;ne,a tv;re az e-tens;va n,
| thev h,xn ret done which would ahsorb
| tha;r ubo1s assets instead of M ner cent ~
| tha1, ,nd zrbsr I'll ,h.;+ o.oats bad 1,aa,,
,bno t.,c vartaa min tha forr, nj 4s snnna;d .
"deieued," and "nots premiums, ~ t.,
~ ~ sn5 I Hs-r I 1,.b -nt - ao,,s, ~ % o.sh
:. 49, 5S..1e~ ~ Wat 1a.s tba-, n,;obt
-ai.. ~ - ths;- ,o,c;n., sco nm an ~ !. a..
nrna Mr. HarDes. whose honeatv has neyn,
taa1 o1.s,;,nad baa haan 1ataiv ramor.,
tror, tta bs,3 ~ tha Nev yo,l nanartmant
nartlv Va believe, tbrouob the hostility q
cor+s;n c1aaa ~ jnsnrancs comnaniaa. ",
do not knou vhether the nresant invest1oa
ZION ia in ch,roe Of men Who are conupcten
.nd a;sn,sad to do it iuztjce. But il is oes
t.;n,v ona tb,t ia nnch needed For II th
Ms yort connaniaa. now At tho nye,ap
Lees th.n a;r veara old. snd which hsY
not vt reached the test period Of life in
I eurance. ara indnloinp in the soubistry q
: r,7,n+in,, n,co3,eetad assota AZ reserves ID
, ,ha n,r1na,. If no1;cirs. many of rhic
3 arnot 7,at,ra for trartv veau wh7
: -. .a,. ,,-;,o mi Thai, ~, ..sat. !, a,
8 .s, t.,..;ss ~ o,n,,,;.z;on, tne,
, @' ~ ~ -. - ~.