The daily dispatch. [volume] (Richmond [Va.]) 1850-1884, 1875-02-22
mo insurance Question.

.,, .,enosi 8 from insurance companies as
sncnr;ty for insurers within the State mas
been subject of discussion with the insure
.nce community, businessmen, ana inc '''eui'
hers Of the Legislature, before when' out
readers know. the subject has been prougnt
The mcmora.is,s who bring the ma''er 10
~. attention Of the Legislature ailese rea-
SONS against what is called the deposit sss-
tom, which seem to be conclusive, ana tney |
ask in lieu of that the establishment oil an
;,s,,r,,ce bureau, which shall ascertain the 4
solyency OF all companies doing BUSINESS ID
.ho State ,s better means Of protecting tRc
;,srred against snsolv ent companies thanthe
de,osjt systesa> under which tnsatreht ;rsm-
NAMES may do business in the State, snd
huSiness 80 excessively disproportloucd to
their DEPOSIT that il would seem ridtsalous.
We were strnck with the views OF MIR.
Joux q. Ssrsse on this subject. He's gem
tleman Of clear aud accurate judgrsens, ana
he * a man altogether unimpeachable Oh a
bias en- this subject. lie was appointed Of
Tho Governor. under law OF the Legislature,
On examine tie offices OF the basement Oh the
canito, and report upon tbe'slanner Of the
business there, and tie character and sccu-
r;v Of tt1cfuuas therein deposited. He found
This 'insuranre.dcposit fund, which seemed
IN hrin I'm anon ,lous condition. No~S, see
what this gentleman, altogether aboRe sus-
picion, says Of this extraordinary fuoa:
DO the citizens tbe Common~ealth'sl
derive from the law any Toeneht torompeh'
satetror the inponyeniene g, expense, and haz-
I'd nj ,hiI p6Hcy? Ter thousand dollars is
the lowest, aud fifty thousand ths highest,
tlenosit rtnuired. l venture Che assertion
that NO priyste individual, in selecting an in
surarYce company, ever inquiries as TO the
ann,,nt Of the deposit made vita the Trea'
surer. but rcIies upon the genera solyency
of the cuEe pany, the amount 81 us assets,
and its general reputation for prompt ana
fair dealtHy. But il some beueit were de-
rived by private indviduaIs;it is. to say the
least, OF toubuultsolfcyf Sse Legislature
TO interfere in such cases for Se protection
of private interests. No sueh policy prevails
with regard to otter foreign:corporatiens or
with rs,ard TO OTHER privates onsractS They
are left az they ought tote,r . the exclusive
cont,nI and management of the individuals
Themselves. who are generally the best
guardians Of their own 'dh;erests. AGAIN,
The amount required tie be deposited
* wholly iradeouate TO furnish the
Drotection hesled. TITS protection il
onIy needed in ease of the insolvency OF tht
contrary. TIE large>t'Ss mcss popu al
COMPANIES are the mutsiS.. These have nj
cdpstul, and their deposits are theretort
sma!l-not generally erS- .,renfsoH OF ohen
liabilities within the State. Then. again, II
is doubtful whether III; deposits are 'eoe
ciustuely liable for the obligations al the
company trrated riEasr this STATE; and RI
they are nor, then tiIe'crcditoTs within the
State will kaye to take the ir chances IN tire
race Of diligence. OHs lne ether hsul, The
policy is ~ taliatory one, nj operates most
disastroli.ly upon home Insurance COM
panies, which are neceSsar lly compaf attVely
feeble. anS c.nuot at:ord 60 make these
heavy deposits in every State 10 which
they do business. 1t play s into the handel
the older and richer CONF ,anTcs by cNppll1r.
the Younger and weaker and driving thcnl
from the competitior. 1t ,s9Egaef the de.
posts to be made with the Treasurer of The
Commonwealth. and i'm ?liedy pledges tie
good faith Of the Common weaith for their
preservation. The Comlnon~ealth has net
and cannot have,@ay security Cor their.pre'
seryatiau. They amount now TO anore than
one. milton in bonds. The bond given by
dred thousand dollars, and tAst penalty can.
not safely be Increased. Il imposes .np0E
the Treasurer an oncrous responsibility, aus
subjects him to the charge Of felony ID any q!
the deposits should be lost. Although he
has nowhere to keep them bat in j
common iron safe, which must necessarily
be kept open during the business hours ol
the day. 1t forces the companies, nc nmtter
what the character of the deposits, Ito de-
liver to the Treasurer power Of attorney
comforting upon him complete power to dis
pose Of them. 1t imposes upon the T'rea-
&urer the duty Of determining the vale OF
the deposits aifered, and Of ascertain 'lng
when any of them have become deprecial ed,
without fixing any rule by which he Shall bt
governed in his determination, or furnish na
him any means oil ascertaining the facts In
other words, ii imposes a duty which he "a Il.
not properly discharge, and confcrs upo u
him an absolute determination, which, ma y
be arbitrarily aud unjustly cmployed.'
This is enough. Who wants this absurd
deposit" security after that statement;
But we should add that many persons
doubt whether the State is.at ak responsible
for this whole .deposit-lund OF 4 million OF
dollars. Were that so it would be great
wrong to thec1mpanieS which are requiredae
make it. On the other band, if the State S
responsible. and that amount were abstract
ed, the State would have to refund it, while
in truth it would have been of 40 earthly
advantage to her people.
But there is an argument against the DE-
post law that reaches all our people. Viz
ginia's act has initiated system OF retaiia-
tion whereby States require of Virginia 10
surance companies "deposits" which they
do not require of companies hsiling from
other States. Now, the Virginia insurance
companies have on deposit in other States
some sSO0; 500, which would probably he set
at liberty were We to abolish the "deposit
system which elcumbers our statute-book.
That SUN would furnish basis of discount
to our people, who have long suffered froma
money famine, which has crippled their en-.
terprises and driven not few to bank
Tuptcy.
1t seems to us that there never was SUBJ
ject so clearly di>embarrasSed of complica-
ton for tie consideration of the legislators
OF Virginia. The law they are asked to re-
peal is utterly useless and absurd.
Railroad Supervisors.
The railroads of Virginia have gotten upon