Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1874-11-21
NO. 27l.
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4 REJECTED COKP.NY.

4 REJECTED COMPANY.
To the Editor 0fMe Kennebec Journal:
When at August. enquired il yon .culd
publish an article respecting Life Insurance,
my object being to bring the subject before
the Legislature, for the purpose of obtaining
a change in the law Of our State respecting
State supervision over Insurance. You said
if there was nothing personal, you saw no OBJ
lection, as Life Insurance was something in
which general interest is felt. / told you
would inform you by letter the substance of
what should want to put in our paper when
the Legislature is in session. l shall first
give an account of Life Insurance Company
which our Commissioner refuses to admit in
to this State.
The Protection Life Insurance Company of
Chicago, Illinois, which has been doing bust.
ness about four ears, has at the present time
about 10000 members. 1t has . capital Of
200, 900 dollars. The State Auditors certi6-
cate shows that on the 31st day of last De.
&C mber, it had two dollars of assets for every
dollar of liability 800, 90 of its capital is
deposited with the Treasurer Of the State for
the benefit of the assured, and any claim up
on the Company that is not paid within ninety
days after it has been adjusted, can be OBJ
tanned by calling upon the Treasurer ~ pro.
vided by the law Of the State Of Illinois, and
the company can do no more business until
the sum that is thus taken 10 restored by the
company. The company publishes MONTH
ly paper, which is sent to each member Of the
company, free Of expense except postage, in
which an account is given of the business
done the preceding month, in each paper the
name and residence of each person that has
died, that was insured in the CO mpany, and
also the amount that has been paid upon each
death claim, amounting to $712,03 up to
fho Ist of loa hoa hp,a aiu
on the following plan viz. on . policy of
$5,000.00, its charges and admission fee Of
$1,000, and deposit of $1,000, of : person
that is not more than forty years old, ~ Sc
curity for the payment of each assessment for
death losses; age above forty, proportional
sum according to rate of premium. 1t has
no classes but is an entire company, each
one being assessed according to age and
amount insured. Assessments are made at
the end of each month to pay the death losses
of the month, and 40 each member has to
make deposit sufficient to cover the assess
ment of the month, the assessments are vir-
tually paid in advance. If the member fails to
pay his assessment within thirty days sfter it
is made, the company pays it with the money
deposited by him, and cancels his policy. The
membership Of the company may fail, but the
company cannot fail so long as 1t has 5000
members, for the reason that 81. .000 90 is the
largest amount insured on one life. and the
company has right to assess eash member
to pay the death losses. having 10 its treasury
money deposited by the members to pay the
assessments with, if the members fail to pay.
From present appearances, there is little dan
ger of the failure of membership. The con-
tract between the company and the assured
in the policy given, 10 that the assured after
the first year, shall pay annually to the COM
paRy the sum Of five dollars for doing the
business, and also all assessments made to
pay the death losses, the cost of insurance be.
ing $5 90 for expense of doing the business,
and his proportional part, according to age
and amount insured, of death losses. The
company on its part agrees to continue the in
surance, provided the above conditions are
complied with. Now if the company should
stop business, you see that those who entered
it at the commencement would lose nothing
as they have paid to the company no more
than the actual expense of death losses, and .
fixed snm for doing the business. Their con-
dition would certainly be very different from
those who insured in the 40 failed up compa.
MES, where they have been paying four times
as much money as was needed to pay the
death losses, under promise that the extra
amount should be returned in part by divi-
dends, and the remainder put into q reserved
fund for the benefit of the assured, but has
been spent for extravagant and unnecessary
expense, such as ~ or $l5, ,0CO.O 90 for Office
so per cent. of the first premium paid to agents
furniture, Sl5, 900 90 salary for a President,
and other officers in proportion, from 80 to
for obtaining risk. If the premium
amounted to 500 90, and it often exceeds that
sum, the assured paid to agent from $4,000
to $50 90 for the privilege of entering the
company.
The company has encountered a determined
opposition from agents of other companies,
statements have been made in the papers by
agents, which they must have known to be
false at the time they were made-such ~ the
company has failed; its assets we're in the
hands of a receiver; i. never paid any death
losses, &c. Please look at monthly paper
l have sent you. The company not With
standing the great opposition, is licensed in
most of the Western States, in New Jersey,
Pennsylvania, District of Columbia and Yer.
mont, and has been refused license in only
four States so far as know, where applca-
ton has been made, viz. California, New
York, New Hampshire and Maine.
About one year ago, applied to Mr.. Nye
for license. After showing him evidence of
its financial condition, he said that he saw no
reason why it was not entitled to . license,
but said the year was SO near out that he had
rather have delay to the end of the year, and
IL ~ Wao ia u SVou SOuuhtou at tue cuu VI tue
year as it was at the end of the preceding
year, he would give license, but before /
obtain documents showing the condition of
the company at the end of the year received
letter from him stating that he did not think
it would be for the interest of the State to ad-
NIT that company into it. I however OBJ
tanned the necessary documents from the
State officers, and called again on Mr.. Nys; he
told me, at first, that he could not admit the
company into the State, if he should he would
have Paine and some others on his back, but
after talking with him awhile he said, il l
would have the papers, he would examine
them, and if he could would give q IL
cense. After waiting several weeks / re-
Quested him by letter to decide whether he
would give q license or not, and received for
answer that he thought the manner of doing
business by the company was wrong, and that
it could not succeed in business.
When at Augusta lately, l had another talk
with Mr.. Nye and he told me that he would
not license the company, let the financial con.
dition be what it might, aud gave 10 4 reason
that he did not like the manner in which L does
business; that in his opinion il cannot long con.
tinue in business. consider his reason inval