Memphis daily appeal. [volume] (Memphis, Tenn.) 1847-1886, 1871-03-16
FINANCE AND TRADE.
OFFICE OF THE DAILY APPEAL,
MEMPHIS, March 10, 1871.

PROJECTING POLTCY-HoLDERs.
The New York BlaJstjn, of the 18th,
SAYS: " The bill foT the protection OF the
holders OF policies Oflie insuranCerwhich
passed the Assembly on Friday, will, if it
becomes q law. have g tendency to effect
an important reform which should have
been made by the companies long ago,
without waiting for legislative action re-
curing them 10 do so, The bill provides
In effect, that no company organized or
doing business i'm this state, which shall
issue a policy Of insurance on the LIE OF
an individual and accept thereon Lnfee
annual payments OF premiums shall De
permitted 10 defend q suit brought 70 re-
cover the mount of the poucyl IN the
event OF its becoming a clalul by present
ingtbe plea that the policy was OBTAINED
bs fraud OF m.sIsaresenIAJlOu ON q part
Of the assured. To other words, II there
is any fraud or representation on the
para of Hl applicant Tor assurance, by
which he msV obtain 8 policy upon his
Life OF the lie of smother, it devOlvEs up
on the company 10 discover tt before the
policy Is issued or within three years
thereafler, which is certainly a long
enough time; and If tbs company shall
neglect or fail TO make such adiscovery
during this period, they Will not bs per-
mjJted 90 contest The payment of % policy
when. through the death of she assured, it
shall become q claim. The passage of such
9 law would, in r8slllY. protect the stock
holders OF the life iusursucs companies
quite IS much as &c W~Oul6p1ntect policy
holders. since &c would require b nan
gers and officers of those institutions 70
adopt measures for their own protection
against the ulslgne. " Of SCENTS in pre-
seutluE the applications Of persons whom
they know 20 be ineligible, or concerning
whom they may have neglected 10 make
the proper inquiries. The agent has, as q
ruIs, &c interest in the company employ
ing him, beyond the fsct that he earns a
commission upon tho business which he
brings it, and his object is to get all the
applications he Can. whether the risks
which he asks the company 10 take are
good ones or not. In W~sll-managCu conn.,
p6ui6s the thorough medical examination
insisted up0n in every instance usually
prevents the practice Of any frauds which
resTlv absolv8 them from the moral Obli-
cation 20 pay their losses but all csmps-
MES are not well managed, and in the
scramble for business too many Of these
institutions take risks regardless Of any
thing but increasing the number Of their
pOIcy-holders, % rely upon post morton
Investigations 90 relieve them from the
paymsu OF losses, sitter accepting premi-
am after premium, thus binding them
selves TO the fu.nlment Of their contracts.
So general has this method Of doing bust
ness become among the class Of compa-
mics which enter into the competition for
business under the Disadvantages Of linn
tied capital or uncertain reputation for
ais1liditvn and A" bottom" that in many
Offices the death Of a poICy-hcIder, before
he reaches the period defined by the actu-
aries' tables as the limit Of his expect
aucv," is looked upon as furnishing priHtG
face evidence OF fraud, which justihes the
companies in c3ntesting a clam until its
validity is established by the claimants. |
such a course is at yarlance with both |
law and equity; and although we do not
aDpr0ve OF special statutes prescribing to /
corporations OF any kind the msune in
which they shall conduct their business,
q law providing hat any company issuing 1
& Life policy and accepting three annual
pavmsuts thereon, shall be estOpped
from i~uterp0sing the plea of fraud
its payment j. demanded, would, we
think. have a good influence in correcting |
many sbUses 10y which the companies are
themselves sufferers