New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1877-03-17
INSURANCE WRECKING.


| PROM HOLDERS BY WORKING on THEIR PEARS
| AGENTS, ADMISSIONS or CRUEL WRONGS AND
| ABUsEs-MR. FURBER's ASTONISHING CONTRACT.
| An insight into the manner in which policies
were transferred from the North America, Guardian
Mutual and other life insurance companies TO the Uni
yersa Life Insurance Company Is easily gained from the
aiHdavs given below OF AdOphus N Lockwood, Thomas
g Flatery and others Messrs. Lockwood and FlatteT
were in the employment OF the companies insurance
| agents. These statements were made before Otis j.
Cwson upon an order Of reference granted by Judge
Dvkman on Feb. 81, and the agents were examined AT
great len 9Th by John Hill OF the law firm OF Redheld
HAL The aidauts will be used in support OF mo-
ton to be made before Judge Dysman in the suit OF
Ethelbert Bcnap and others against the North America
Life Insurance Company for the appointment OF re-
cever The OF the testimony given before
| the referee IL IA follows:
Adolphus n Lockwood OF East Orange, N. J., stated
that he was life agent doing business at Nos.
II and 10 Warrcn-st. NewYork. and had been in that
business for the North America Life Insurance Com
pauy and the Universal Company for about years
The North America had not sought any business
since October, 1874 when " d. Morgan the President,
retired from the management On the Monday follow
ing Henry J. Fugber and others took charge.
few DAYS later Mr. Furber described to the agents his
plan Of changing policies OI the North America to the
Universal After that. according Instructions the
agents began the Of changing policies The agents
we're paid in commissions on their WORK In bringing me
policy holders into the Universal Company great
many poicyhoders allowed their policies to lapse out
rights took paidup policies sure derIng thcr
old ones others who could not avail themselves OF TINS
change account Of l-health either allowed
their policies to stand, and continued to premiums
sold them to the persons who applied To them Tor
the best price they could get. The agents author
lied TO buy MP the policies the actuiry, George L. Mon
tague John II. Bcwcy~ fixing the limit Both Mr..
Bcwley and Montague were directly interested in the
| Irniv the
chase the policies low figure possible by offer
ing them Onehaf the difference between the limt liked
and the price for which thew could purchase the policy
In explaining how the limit fixed the witness said:
The company must Get apart from it, income certain
sum OF money with which to pay the policy ut maturity
Its amount varies under the laws of different
States In New-York it is determined by
first asceraining from mortality tables the
average duration Of the life assured. Then they
take snch su, invested at ia cent with it, ac-
foundations would produce the face OF the policy at ma
ur1ty The is always the representative of the
companies liability or contingent liability on the policy
In fixing limit the company used percentage OF this
reserve seldom the fu amount Of IT, In buying up the
policies of sick and nfrm holders the company would
always ii \ limit there would be pr1h in
llb.radug tine by the purchase. The Universal
Company paid the commissions"
The witness could STATE what became Of the re
serve surrendered policy, though he said per
ceutagc waS aoY we'd 10 the insured The officers and Mr.
Furbar had charge of these mat tcrs The percentage 10
the insured allowed in part payment Of his premium
due TO the Universal The po,icyhoiders III the North
America were not aware of tn amount of reserve on
th,ir policies unless able to make It ou themselves. The
AGENTS did not know rs a rule, and depended Mcssrs
Bcyglcy, Montague and Furbcr
Many applicants for a change to the Universal, the
witness said, refused on account OF disability, I'M
soundncss incipcnt disease, aud niirmty THIS chang
Ing system WIS susceptible OF very great and very cruel
rrll IN
boldrr3 would az once suffer Outri sht lap>ing
liberating the whole reserve for the bencht al
these insurance men. These diaapPontments were
frequently followed by purchases % the policies
under the conditions as previously With regard
10 padup policies in the North AWeEica, the effort was
10 change them into prcinum-payng policies III the
Universal not in the North America It was desired to
throw all the new business into the other company.
IL November last Charles p Grln told him that 'hcrc
was some ARRANGEMENT by which Nh furb.r received
no re than hi, salary officer 0i tie c"h'ah} Al
This time haI spoken to Mr Griffin Of what he con.
,Grrcd the gross Ia toe companies ana
said that lie thought 1t an outrage tina" their a"r'
bad not been exposed before. He firmly believed
that If the Moth America had what belonged t.
Ii it by Far better company than thc universal
TESTIMONY OF THOMAS :. FLhTrEhY.
Thomas : Fattcry. an insurance agent Of In" Unver-
sal C,np,uv $50 testified that his duties were 10 take
North America and Guardian policies II order 10 change
them into Universal and in some eases to purchase
policies nj figures which we're furnished HIM lie re-
eclycd half the amount saved under the limit for put-
chase the company restricting him, however. low a
certain figure. The limit was percentage on the re-
serve Of the policy and averaged about 10 per cent
Nany applicant, Tor change mo t"o 5hEe
sd wen, rejected because thy could no.
pass satisfactory medical examination. The7'
examinations were perhaps q Httle NOR SEER M.
they Few years aso Inc eh,ct wa. 10 eve ,no
Universal liz s,e,ton cat OF the lives insured IN me
Otner tEu companies. TINS lrIt very poor Glass % 4'N
in ire latter, ana entirely changed the bt,ts t'i "hth
tne pory-nu!,i were admitted INTO tnc NorIh America
and Guardian IL mere scd tie average OF esI'o.V"
mortality OF those 1.e' az fearful ra'c fit pre-
TuIns had been paid iong on the basis OF class 81
lives averaging ccr ln Duration Ilr cii'c N'etteu
al the ivo5 wnose average would De io...3,,, AMI
North America, That tn ayerage OF the rem nnE
probably 10 rejected AID this represented tir
relative increase ~ m)fIa! III ie i''U.u ~ com
The Disappointed a'PlrihS MeIp i''''9 IC' ' ~ -
in few Instances, where person Mas 80 D!"N on tt
he con!d get in 10 other company ~ Wolff sometimes
continue pdj ing premium. i1i'r III ~ 49, MI
Tu" UitLe-, known r. FuD.r lJr about year ana
il half, AMI Nd heard nom Charles T. G..al, MANAGER
that hc rfcthcd n cO'"hi'S''", 49, - .'l,y,'
receipts the Universal, oter ana apoF, lis siay
intI, 80 ~ r ,II.t al line, conn l. tnc wines
presented "a copy of the instruction, received by L."
,2sns, .'r,rU 20 IA is inI c'prncd mi the STAT
ncn,s Inae ia regard to the limit Of payment on the
policies. ana the hair winch Lio agents receive" %"
The Iusf1cfi1ns were on The paper OF the Uivefss
Life and signed ny onarIto T. PUNtli Hll
rral Manager ana Samuel l. Knight. SuPcrinscnd NJ
HOW POLICY-HOLDEES WERE sWISDLED.
Arson d. Ioy real estate merchant at No 2i5 Broad
WAY to- tics that a one time general agent OF
the North An, ca aud familiar with the methods
resoricd by acting IN the interest III tha com
many and of the Universal lie procured 5000 NE
n,cv for Herman Neugcr ui YOnkcrs, and TIL after II
bod run or six years, agents had cud ayOrcd To pT
ct,c Tor sJbD Within year, Dlr hrhscr, Just I.co'
crin from am attack ol paralysis. visited the North
America Office 10 pay his premiam ana was then
informed that the COMPANY ni' i"'.'u uni ~ , n'u
d.ius 50, aud paid the premium. II Ire