The Daily clarion. [volume] (Jackson, Miss.) 1866-1888, 1878-02-15
The Insurance laws.

which remain on our statute book
precisely as they were left by the Radi-
cal party which adopted them as a forced
loan on the companies that were doing
business in the State. As an example
of what the press is saying we have copi-
ed the following from the Aberdeen
Examiner, one of the ablest of our State
journals:
We heartily agree with the Jackson
CLARION in its condemnation of the present
insurance law which requires $4,000 de-
post from those companies doing business
in the State. 1t has resulted in driving out
many popular companies, and has kept
numbers of others from entering this field,
and the result is that there is less competing
for insurance business in our State than in
any other while the premiums we UNDER
stand are uniformly higher than elsewhere.
Before the passage Of this law. almost
every company of note In the United States
sought business in Mississippi. and insur-
ance companies, like all all other CORPORA
tions, were frequently forced to lower their
rates in order to obtain patrons, but after
the enactment of the deposit law" the
few companies that com piled with its de-
mands-and many of the strongest retired
united in every locality where they estab-
lished agencies, into corporations" rings"
that fixed uniform rates for every house,
and thus while the owner was left the
choice of cOlp any, he was given to under
stand that there was no hope of his obtain
ing less rates than those offered by the first
agent he applied to.
The Insurance Law as it appears in the
Code of 1857 was good enough for Missis-
sippians before the war and should be re-
enacted; there is neither sense or reason in
accepting the legislation, in this matter, of
a combination of carpet baggers and in
surance sharks, who together patched up
the present statute. Under the old law the
party. insuring knew what he was about,
for every agent was required to publish III
the county where he was domiclIed, a COM
plete statement of the condition OF his COM
pany every year, and the statements were
anxiously looked for by insurers, guiding
them in their transactions; and if the de
post law is not repealed it should at least
be so amended as to com pei these local ex-
hibts wherever an agency is established
In proof that the effect of the law has
been to diminish the number of compa-
MES doing business in the State and thus
to diminish the revenue from that source
and at the same time increase the burden
of policy holders, it is only necessary to
refer to the Reports of the Auditor of
Public Accounts from time to time. Thus
in this report for the years 1874.'75, that
officer said:
ga reference to Document RI will show
that the number of insurance com panieS do
ing business in the State in compliance
with the existing laws, is gradually decreds-
ing. The system of requiring deposits to be
made with the State Treasurer, seems to
solvent companies. privilege tax of
$1,000 is now required by law, to be paid by
each company doing business in the State.
The amount thus received is much less
than the interest now paid by the State on
the deposits made by the mpanies, and
the present system is a source of consider
able expense to the State, without any cor
responding benefits. The amount of the
deposit required in each case is but little
security to the policy holder against loss.
/, therefore, recommend that all insurance
companies, now having deposits, he author
lied and required to withdraw IL same, by
giving due notice thereof, and that hereat-
ter each company doing business in the
State be required to pay an increased priv
ilege tax for so doing, under such regula
tions as may be provided by law"
And in his report of the next year,
the Auditor reiterated what was above
said, as follows:
"On this subject | am still of the opinion
that our insurance laws, Instead of being an
advantage to our State, are directly the op-
posite. A change in my Judgment could be
made, that would be better tor all interest
ed"
Previous to the passage of the present
law by the Republican party, there were
thirty Insurance Companies doing busi-
ness in the State. Now the number has
continued to diminish until they are re-
duced more than one-half below that
figure. And the revenue derived from
that source has diminished proportion.
ately.
1t is said, however, that the financial
condition of the State will not admit OF
the immediate withdrawal of the deposits
on which the State is paying an interest
of six per cent. Then let the reform be
applied to the Life Companies the
deposit system be abandoned, and a
privilege tax of say two hundred dollars
be imposed upon every company that
chooses to establish agencies in the State.
The present law is prohibitory. The
Life Companies cannot afford to pay the
tax. All except two outside Compa-
mics have been driven from the State !;
and she is paying larger sum in inter