Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1871-04-17
1oeat am State Nems.
The Business Of Insurance In this state.

\ A. W. Paine, Esq, of Bangor, Commits
sioner of Insurance, in conformity to the law
creating the department, will soon issue his
first annual report, showing the condition and
extent of the insurance business in Maine,
and the standing and responsibility of the
feompanies occupying the field. The new
['system has been received with general favor
and has thus far proved successful, as it pro-
vides greater security against fraudulent and
irresponsible companies. No company from
abroad is permitted to solicit the patronage of
our people which shall not first prove it abil-
ity to meet its engagements. In case of
loss, the insured has not to seek his remedy
abroad, but the courts of his own county
provide the requisite remedy and security
Companies Of doubtful character have failed
20 receive the requisite authority from the
commissioner, and have Withdrawn from the
Estate. The companies doing insurance busi-
ness or admitted into this State prior to Jan
larry l, 1871, are as follows:
Domestic ~ State Companies-One mutual
life company; 8 stock marine companies; 3
stock fre-marine companies; 2 mutual ma
Fine companies; "a mutual fire, of which 20
|tre town companies.
Foreign Companies-Forty- -four life COM
Panies; l accident company; 6s fire and fire.
marine companies. Ia
No exclusive marine company Of another
State has asked to be admitted. The Mer-
chants Mutual Marine Company of Bangor,
has closed its business and retired, its risks hay
ing been assumed by the Merchants Marine
Co., Of the same place-a new joint stock COM
Pany. The Maine Mutual Marine Co., of
Bangor, has been organized during the year,
rs also has the National Insurance Co., of the
Pame place.
Since the first day of January last, six addi-
ional companies have been admitted, and nine
pave Withdrawn. The Home Co., of New
Haven, admitted to do business here on what
vas thought to be good evidence of its sound
hess, has met most disastrous failure, by
which many of our citizens are losers. Its
|udden failure brought to light the fact that it
bad but $500, 900 capital actually paid in,
|while in few years it paid out 81 200, 900 in
dividends, and that the company was deficient
bf means even to remsure the risks for which
they had received pay. The Great Western
Mutual Life Co., has also been found deficient
10 q reserved fund, but no loss has occurred
bn its account in this State other than par
Hal one of premiums paid.
Since July, when the law came In force
P25 companies, foreign and domestic, have
been licensed, each Of which pay 500
Eighteen brokers' and 1887 agents licenses
have been granted to 6l9 different persons, the
|ormer paying s., and the latter 81 each,
making an aggregate of S3,777. Deducting
(he fees allowed the commissioner for his SER
Fiees, clerk hire, &C., $2500, postage, sta
6onery, &c., $ll5.59, net revenue to the
State remains Of SllGl.4l. So that the de-
partment has proved a source Of revenue, in
Dependent of all other benefits resulting from
rs establishment. ~ t.+
The statistics of insurance have been care
FULLY collected and are presented in numerous
ind comprehensive tables, so that the public
may see at glance, and at their own fire.
sides, the condition Of each and every COM
pany.
The commissioner has had occasion, during
the year, to pass upon the merits Of several
cooperative life insurance companies, with
result unfavorable to their admission to do
business in the State. The plan of these
companies consists in the formation of the in
bured into classes Of 5000 or 25O0 members
zach, formed according to age, upon the
Heath of each of whom, every surviving men,
Der shall pay the company one dollar and ten
cents; the dollar to go to the family Of the
deceased and the ten cents to defray the ex-
penses. These are the only payments re-
CURED to support the policy except an initia-
tory fee Of to 10 dollars and an annual as
sessment Of 81 or SO more. Another part of
the plan is to fill all vacancies caused by
death or otherwise, by new members of cor
age. The great objection to the
systemis the almost total lack of any legal
obligation and, security for the payment of
the policy. The great maxim Of the business
is ''that those who live shall pay the losses of
those that de-" . decidedly bad rule. The
correct rule applied to life insurance leads to
gradual accumulation of fund during the life
of the insured to meet the contingency of his
death. The commissioner aims TO show by fig
ores and reasoning that the system is unsafe,
and Elusive. He is also aware of the
many defects of the life insurance system as
now existing. Among the most prominent of
these are the great expense attendant upon
its operations, and the unproductive termina-
ton, by other causes than death, of SO large
a proportion of all policies issued by all the
The first of these objections
very plainly results in great degree from
the large number Of companies competing for
the limited business to be done. Unlike most
other kinds of business, competition in this
has the effect to increase instead of diminish
prices. The extra number and pay of agents,
the greater amount of salaries, and the thous-
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