The New Orleans bulletin. [volume] (New Orleans [La.]) 1874-1876, 1875-11-07
rNMMERCIAL MATTERS, Etc.
rrau,.rs Insurance Claims.

The following article, taken from the Philadel-
mia Under,criter Of the 18th inst, recognized
authority on insurance matters, should be atten-
GveIy read. The arguments used apply with
aonal force to all branches Of the business:
The most importan. feature of life insurance
ronnsnies and the ultimate business they have
to do. in relation to policies, is the payment of
loeses, This is the object-the very Alpha and
Omega of life insurance. We wish this distinctly
horne in mind by the reader while perusing this
article.
Recently there have appeared in New York
pape1s snd others, editorials upon this question
that were evidently written By persons un-
acquainted with the objects and purposes, prn-
ciples and workings of the great system of lite
tons were made upon companies because of
their contesting claims without the least con-
sideratIop as to their reasons for tueh contest.
The point maintained by these articles lieu in
the simple assertion that companies should pay
al loss -claims at once, and without hesitation.
It lie the design and desire OF life insurance
companies to conduct their business in such man
ner shall afford protection to honest policy
promptly met according to the terms and condi.
tons OF the insurance, there must exist some
good reason for the delay. We do not believe
that there has ever been known single instance
in which the hesitation or delay has arisen from
any wish or intention on the part of the COM
pany to avoid the payment of any just obligation:
We feel entitled to Say this from our long and
intimate acquaintance with many OF the lead
ing life insurance companies OF this country.
Besides, in our position a journalist we have
had frequent occasion to Investigate the causes,
conditions, ETC., pertaining to contested insurance
claims. In nearly every case Of this kind it has
teen found that some wrong-.n the majority OF
instances, that some gross fraud-has been at
tempted upon the company. As an Illustration
take the case that occurred in Cincinnati a few
years ago, in which man buried himself, and
when eXhumed was found to have turned into
broom. corn, the coffin beng filled with that
article; also, the Richards case IN which M au
drowned himself in the Susquehanna River, and
four months after tu' ned up IN the I. ombs ia
New York city, and the recent drowning case near
Rochester, where he man was afterwards fouod
secreted in an obscure place in an adjoining
town. Many attempts, Ill various modes, have
been made to swindle life insurance Companies.
And some have been successful. Of late years,
too, in less cor spicuous manner, frauds have
been attempted by misrepresentation, false
hoods in the application. by eff rts to crowd upon
companies impaired lives, even to the extent, in
some instances (such IS occurred III this city OF
substituting healthy subject in the medical eX-
animation, and passing him off as the real appli'
cant.
Now, if all these fictitious claims were to be
paid by companies without murmur-if all at
tempted frauds should be allowed to be success
full rule like this should obtain in life in
snrance management, according to the expressed
on the subject, what would become Of the peoples
money-the peoples claims who are honestly in
sured? And how long would the integrity and
responsibility of comp inies last under such d
supremf ly absurd rule of action?
We have little patience with writer's who 30
dippantly discuss questions beyond their compre-
hension, or rather without first gaining the
knowledge requisite to correct understald ding.
1t is little singular after all, that life insu-
rance companies have so few suits at law. They
must be managed with more honesty, with MOI e
business and financial ability than any other in-
terest in this C, untry, bearing any comparison in
pecuniary magnitude, because there can be
named no other great interest, commercial man
ufacturDg, mining or banking the record OF which
will Dot show thousand law suits to one in life
insurance.
Why then do we hear cry against life insu-
rance because OF an occasional lawsuit?
Counting all the policies that have been paid
in the United States bv life insurance com panies
ninety-eight per cent have been paid promptly,
without hesitation, and only two per cent In
yolved in legal contest.
The officers OF companies are not benefited by
any legal contest, the companies in their pub ic
cSpacly are not benz fitted, and it ie, therefore,
only to carry out the Obligations and solemn du-
ties assumed by the officers and trustees, that
lead companies to contest all fraudulent demands
made upon them, and thus to protect honest poll
cy-holders, and maintain the integrity, stability
and futur, usefulness Of the companies.
The G. cnt English and German Banks.
The following is from an article in the journal
of the London Statistical Society," comparing the
Bank of England with the Reichsbonk, or Ger
man Imperial Bank
Under Sir Robert Peels act the total fduciary
issue (n,t backed by coin) Of the English, Irish
and scotch provincial banks is limited to f15,-
1857, 000-the English being f6, $4,000, the Irish
e. 354 0O0 and the Scottish -, $4,000 The Erg-
llsh (prOv ncial) issues Can not be extended be-
yond the sbove fixed amount, but the Irish and
Scottish banks may have god and silver coin In
due proportion 10 any surplus issue
The German law preecribes to the whole OF
the provincial banks first limit Of fiduciary issue
of a total Of l35,GOO,00O marks (after deducting
$50 DOC, 600 marks for tn, Imperial Bank, equal
to f6,75h,OOO, against the English fl5,8O0, 600.
That is to say, the German provincial banks may
issue &C. $50, 800 in fduciary notes without gold
behind them), and for the surplus above this
they must have cash, which is defined as either
gold or State (greenbacks) or other notes.
tSuch other notes are those OF other banks
which may happen to come into their tills. So
far, says Mr.. Seyd, the arrangement resembles
our Scottish issues. + But this allowance Of
&C. 750, 900 uncovered notes of the German banks
is only what may be called the first limit.
Our (English) limit OF f15QO0,C coo this is ex
elusive Of the Bank of England fiduciary iesue)
s 50 far the final allowance of uncovered issue );
the German law admits of further extension OF
issue of credit Every ba. isr ue its share OF
the first limit without paying any tax whatever to
the State; but it may exceed that limit provided
it pays to the state tax of five per cent per an
mum on such issue. such over-issue, however,
must not exceed proportion Of one-third, to be
held against it IN cash (cash, either gold State
igreenbacks,I or other bank notes.)
1t remains to be remarked that these banks
can not issue notes in future of less than 100
marks, or f5 (s25). The State itself, under
law passed in April last yar will Issue 10000
GOO marks in State notes (greenbacks) of smaller
amounts. If the Imperial Bank desires
to issue more than f12 5O0,0 900 of notes above
bullion, it can do SO on paying five per cent per
annnm tax to the State, provided it never has
less than one-third OF cash.. e., either gold
State (greenback) notes, or other bank notes-in
its Golfers.
OUR POLITICS AND OUR PERIL.