Morning journal and courier., 1883-03-08
The Htna Life.

The Proposition to IncrenSe the Capital
 StOck-What Old InRuranee Man
 Thinks About It-AdtitfOnal Strength
 and Security to be Gained by 1t.
 One of the matters before the Legislature which is now bsing somewhat vigorously discussed is the bill authorizing the Htna Life Insurance company of Hartford to in crease it's capital stock from time to time to an amount not exceeding $2,o0O, 900 as fast as it's surplus earnings in the stock depart ment will warrant.
 Mir. John G. North, of. this city, has had an experience in insurance matters which gives his opinions concerning the questions involved in the bill unusual interest and i'm portance. Mir. North believes that the in crease of capital proposed by the bill would tend to strengthen the company and give additional security to policy holders. Said he: ''The surplus in every stock insur ance company belongs to the stockholders by the charter which created the company, and dishonest men might wind up compa- ny at will and pocket every dollar of surplus; but the moment that that surplus becomes incorporated as part of the capital stock it is holden invariably as a protection to policy holders and it would be 8 criminal and State prison otfense for the stockholders to touch it.' Further MT. North explained the risk attending every business enterprise, of which life insurance like fire insurance is one. Men put in their capital at the hazard of losing it by unfortunate events in the progress of the business, and when success attends them they are entitled to the benefits derived and whatever surplus earnings may be de- rived as business increases and additional lia- bilities are incurred the stockholders are in every case permitted to capitalize surplus and thus strengthen their enterprise and make their security stronger. No one will claim said Mir. North, that the Sargent con- cern of New Haven, for example, should not have the benefits of it's increase of busi- ness from it's small beginnings to extend it's sales by the addition of accumulated earnings. All great enterprises are built up by this source of strength-capitaizati of profits fairly and honorably earned by success full business management. The Htna Life started, he said, with small cap- ital of $150, GOO. It has prospered. It was stock company exclusively, as 1t is to day in that original and separate department of it's business. It was about 1860 that it or ganized participating or mutual depart ment, which is wholly separate from the stock department. That was at time when even some fire companies practically adopted plan of participation by agreeing with the insured that there should bs rebates of pre- miums if the success of the business war ranted 1t.
 Another important phase of the matter is the bearing which the capitalization of the surplus as proposed would have upon the taxable interests of the State. This surplus, as surplus, is non-taxable. Converted into stock it must pay both local and State taxes, and when the whole amount of increase to &, ,0OO, 900 is reached by gradual accumula- tions-for it must take a series of years to cover the maximum amount-the company will contribute in taxes about $4O,O0O more than it now pays, which is an important item of revenue. The Htna company has paid into the State treasury in the last ten years, from 1873 to the present time, the enormous sum of about $s5O,O0O. If the capital stock had been $2, 900, 900 the amount paid in tax es would have been million and 8 quarter of dollars.