The daily dispatch. [volume] (Richmond [Va.]) 1850-1884, 1874-04-21
LOCAL MATTERS.
,~sxRtNCE COMPANIES.
.srrClAl. LEGISLATiNEC COM
E'T'n. - To Tnr pEroSlTs MADk
nr-u 7nE STATE TREASURER.
~ ryadc<i by many Companies
~ no,,r Ru>incss I'm this Sfafe--An
re.tius ard Important
Exhibit.

Co.. lY>;rc<S in Virginia was Yesterday
1..',--:.,'3 10 both houses Of the General
'"'''.,1.y ny ;he special joint committee ap-
49, :, rxsnine into the affairs OF the
'',, .,,..o, cfIircs Of The CApi'o';
O. H.. se3c~d! AS$.Tn''y
r., ,.;,S,c4<icnei. your joint committee OF
lection into the management OF the
r." -. Offices Of the capitol. Sc. under
- ..y~gi i,iAt resolutions TO THIS ena'
-, ,l1,y have not yet concluded the
,.,,.,' ',i,.yp,v,l upon them by the terms OF
49, ~,.. ,g.jcnS referred 10, deem il proper 70
/. ~, following report:
>,,,,r .o,,,ni::,c. since their organization.
~, - instant. immediately after their
<....,,.,,.,7.u,. have held daily meetings. and
-',..,: % tie investigation required OF
~, .., mach lime As they could spare from
.r..- ,,,nlirtnE duties in their respective
y .,,., = tho General Assembly. The re-
- - ,r has reached \ thorough eNami-
...,, a., The accounts. deposits. &c. Of the
r-.,a-> ,,rciIu insurance companies doing
''",,.,... II the state. and partial inquiry
,..n ,3, mode OF conversion and funding
- So. ,,rgA and the exchange Of bonds
,...,.r n. hiulng bill, so far rs it is con-
':,,-.i n ,ne rlesSurer'S Office. The latter
49, II ,hci! inquiry. though not yet COM
1".t. "a, developed certain impertectienS
: -. mode OF such conversion and funding
l..,,ofar, and still in practice in this office,
,ow,ich they will call your attention when
,1ey lave fully completed their eHamlna'
u,G.
Ea; upon the investigation OF the Affairs or
,rp ,1..i.n insurance companies certain iacts
.-s sr.a-eut which make it important that
,or- committee should at once lay them be-
i4-. y9u. with view 10 the prompt correc-
ron 4 the imperfectionS existing ID the pre-
81: laws.
The law IS il now stands requires all in
,...ucc companies not Incorporated under
II. laws OF Virginia. and desiring to do Ou-
.,r,>, in the State. 10 obtain license there
h-. ?ud makes it necessary as prerequisite
e. ob.aiainc such license 70 depoSlt with the
Treasurer bonds Of the State OF Virginia, or
o. tb, United States. or Of the cities OF Rich
ua.d, Petersburg. Lynchburg, Norfolk, or
Alexandria. or fir>t mortgage bonds Of some
railroad chartered by the State, or individual
bonds secured by deed Of trust on property
!, The S:.te. &c. ">uch deposit being esti-
mated a, the market value thereof at the
fne such deposit is made (Code, chapter
o.. >vtt.ol GS.j
Tl. comuallieS now doing business under
n, provisions al this law are enumerated In
Il, schedule hereto attached, and forming
raj Of this report. with statement OF the
amount and market value Of their deposits
ss:ar - il can be estimated and the character
9. ,ccJ-iilc>.
III, minimum deposit required in every
e.,~. uudIr the law, is $4,000, and 1t Will
l.u> b. >ecu that several OF these companies
Law ~. complied with the terms of the
lae, thyr deposits at the present market
ys.u" Of the securities falling far below the
minimum in some instances. While it may
b. SAID iha: the Treasurer has the power,
aud liza: j: j. also his duty, to require the
u:m1>. stric;nesS Of compliance with the
law on tlc part of the Insurance companies
IL uaki1g their deposits, so as to compel an
sr9ouni Vi deposit that will certainly equal
u market value the minimum amount re-
Cuirud, vet it is suggested that more GER
hiaiy ought TO be eXacted by the express
term, Of the law, so rs to take from the
Treasurer discretion which may be i'm
l.cvidently exercised.
The individual bonds, which constitute
III bulk OF the deposits in some cases, and
tie sole deposits IL others, cannot be said to
have market value al all. No only so, but
IL case Of the failure of any company the
difficulties in the way of collecting them
A!sht amount to- total defeat OF the OBJECT
fox which the deposits Of securities are re-
suired. II maDy Instances they are not due
for several years. The obiigors might, in
case Of bankruptcy Of the company, claim
thr amounts Of their policies as set-ottS
AGAINST the bonds, and your committee are
10. prepared 10 say with what success this
cain might be maintained 10 the detriment
Q! other policy The Treasurer cam
Lot he expected 10 examine into the suttl-
c.ncy OF the security in such cases, and
while il may be said that the insurance COM
p4nics will assuredly not take such bonds
fyr loans On insufficient security, yet it will
b: ,erl that the door is open to fraud by this
Erap> through collusion between the COM
l'any and any irre>por sible or even imagi-
nary party. At the best the collection OF
such bonds would be always liable to be at
tended with delay, uncertainty, YeSation,
and loss.
Your committee suggest that the Law be
changed 50 AZ TO make these bonds not re-
S;lyabIc az deposits.
1Our committee are further OF the opIn-
ION that it would he we'll to require that oil
tue bonds deposited a. such securities should
be OF the class Of registered bonds only, so
ahat, IN case Of their loss, the State would
not incur any responsibility for thems At
present portion Of them are bearer bonds,
and in case Of loss could not be traced.
The law is also defective in fixing the
market value at tie time Of deposit as the
criterion Of the value OF the securities. AS
u 1ow stands, the deposits might be fully up
10 the requirement at the time, but there i,
10 provision for their substitution by Others
oi equal value in case of their depre-
cation below the minimum, except in
,he discretion Of the Treasurer, and the
law X SO worded as to impress the exercise
O, that discretion very lightly, and TO require
Al OILY once year. The examination should
De made of;ener.
II does not appear TO the satisfaction Of the
eomuI!ee, by any proofs or vouchers Gted
With these securities, that Ia all cases the law
requiring the deposits TO reach at least ave
I'r centlNn of the capital stock Of the COM
pany depoaiting the same, or that requiring
liz 'naurance policies on property on which
aAs ionds deposited are secured to be filed
"'ta lhe bonds, has been compiled with.
:, careful comparison of the deposits win
'Ne records in the Office has satisfied the COM
n'i''ee that they have not been IN anywlse
lLteitcred with.
WIN. D. QUEsgEBgRgy,
w. r. TERRY,
Senate Committee.
II. II. RIDDLYBARGKR,
n r.