New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1877-01-30
TILE LEE INSURANcE TRANsFER.


the history of life insurance amalgamations
will prove to be the last. 1t certainly sur
passes all the rest in its striking characters
tics. The story can be briefly told The Con-
tinental Life Company was in trouble. Cast
ing about for relief, it caught an anchor IN
the net of the New-Jcrsey Mutual. Both com
panes had already been doing loose bust
ness. Each had absorbed by reinsurance
other concerns that had gone out OF business
and had in most instances left Dah
Odor as they sank out of sight. Some OF the
Continental's officers began to contemplate sink
ing their concern into the New-Jersey COM
pany. That they contemplated it with favor
is evident from the fact that they reinsured
large number of their risks there, and paid
to the Ncw-Jersey company for such relnsur-
ance more than 100000. But when 1t
was proposed to 60 over bodily, few
of the officers of the Continental objected.
Another process was devised suit
was brought by stakeholder against
the Continental, and its officers stood by IN an
attitude of surprise. When a receiver was APP
pointed he did not appear as the choice OF the
officers but they yielded an apparently re-
iuctant consent Then two of them became his
bogdsmen. And then everybody in life lnslr-
aucc business understood that all THIS was
another way of turning over the COntlnehtais
assets to the New jersey Mutual The latter
concern held out programme OF glowing adj
"yantages to the policy holders OF the broken
compapy. About thousand Of the mtortu-
mates are said to have awaited themselves OF
the ofl,r Others took different view OF the
in, In
modify the leccivership. Meanwhile the New
Jersey company was iioundeIing IN deep water
The Wholesale transfer of the Continentals
assets MIGHT still have kept the Ncw-Jersry
concern ahoat; but court decision In the
latter part of last week demolished that pro-
grdmme utterly.
At this point the New-Jersey Mutual made
its grand coup. It's accounts had shown dur
ing the State examination that it had run be-
hindhand at least 100000. There was no
hone that it could do business i'll any State
where the insurance department insists upon
soly ncv. So on Saturday it threw itself into
The National Capitol Company at Washing
ton. aAd was there taken in, risks
and all. This performance was somewhat
hasty. The New-Jersey company WAS still III
the hards of the State authorities. undergoing
examination. The Washington concern does
no business outside of the District and Is
practically unknown in New-Jersry. Secretary
OF State Kelsey proposes to ignore and step the
transfer. since he regards it az fraudulent.
our readers will form their own opinion on
this point
One feature is prominent in this whole bust
ness. The Continental officers did not propose
TO consult their policy-hOldcrs. The New
Jc.sey concern did not propose to consult
theirs. In the previous absOrptions OF other
concerns the policy holders were not COLI
suited. The officers Of the companies i'll ell
these cases handled the property as if
II were their Own. Exactly what rights
the policy holders have in their prop
ertv that is thus banded about, nobody
exactly knows. The charters OF insurance COM
pauies authorize them 10 reirsure risks. Nherc
the risk on a single life is large, company
does wisely in dividing it. Of course the pay
for il mast be divided with the risk. AS yet
there is no limit to the practice OF reinsurance
in this state; there Is some preventive law III
Connecticut. the Legislature there having been
aroused on the subject when the American
Nutual of New-i Haven reinsurcd Itself In that
same Washington company to which the New
Jersey concern has gone. Whether Ncw-Jersey
laws can stop the present transfer seems doubt
full. But there will be, We trust, no lack OF
effort on the part Of the State authorities.
We may also expect that this very strong
hint will be taken by the gentlemen at
Albany who are so anxious to legislate on life
insurance. As rule their Interference has
not usually been wise, but in this matter it
seems to he needed Otherwise some of the
companies that our State authorities are about
to examine will be suddenly taking their bag
gage 10 Washington.