Evening journal. [volume] (Wilmington, Del.) 1888-1932, 1892-02-04

rpAoA Securpu Tor US large amount OF deslr-
able business. The men whom he insured
were among the wealthiest and most iniu-
entail in The cities where he worked. 1t came
to my knowledge, however, after a time, that
his business methods weresobjectionable and
for that reason, IN zthe year 1889, his agency
terminated.sh Mr.. Dinkelspeil's contract
comes under the general illustration cited
above. except that he was b personal solicit
tor only and many notifications were made
TO enable him to handle the peculiar class of
business which she wrote Advances were
made for the same purpose IL Is probable
however, that while there Is to-day on our
books large volt me Of business of the best
quality, written by Mr.. Dipkelspiel a reason.
able renewal interest will not finally liquidate
the advances made and that this business
will ultimately cost US more than il should.
For any error In Judgment In employing this
man, as well as for any ultimate loss, / do not
desire TO escape from any proper response
MIR. LOomls T. white.
The superintendent Of InJurance discusses
at some length the relations which have
existed for about sixteen years bet geen the
New York Life Insurance Company and Mr..
Loomis L, White, a member Of its Board Of
Trustees and of its finance committee, and
two questions are raised. First, as to
whether or not a firm, member Of which
was member Of the cOmpany's Board Of
Trustees and Of its finance committee, could
act for It as brokers without having the
opinions Of such trustee as to the value of
securities colored by the pro 1able commission
which this firm would receive on such trans
actions; second, whether or not the company
had the right to purchase securities through
such firm Of brokers. The first question
may be briefly disposed Of without discussion
by : simple statement OF ths. results. In the
years covered by Mr.. Whites connection with
the New York Life Insurance Company,
about 1855 000,000 Of securities have been pur
I chased by the company's finance committee
the firm Of which Mr. White is a member,
Messrs. LOOMS l. White 4 Co., and on the
| 30th Of June last the superintendent, after
Yaluing these securities at q time OF depres-
sion found them worth 70 the company so ne
| thing more than $1,000, coo above the cost value
/ at which they are carried on the company =
boo Such a result is the best answer TO all
/ questions as to the wisdom Of the finance
committees action, and in SO far as Mr..
Whites action influenced 1t Is an evidence
/ OF the value to the company OF this connec-
/ tion. The second question is one on which
opinions Of counsel differ.
] have reviewed now with you the graver
criticisms OF the Superintendent's report. /
shall stop here. | realize that there are other
criticisms which / have not referred to, and
DO not deem it necessary to do so. have
| tried to present to you fairly the facts con.
corning those of most Importance and ] be-
| lieve l have shown you that while there
have been errors in the management of this
company, there has been no betrayal of
! trust.
A full criticism Of errors with an equally
/
communication, would have been only fair
/ to you and perfectly satisfac DRY to me, how.
ever severe those criticisms might have
been; but tho Superintendent OF Insurance,
who was invited to examine the condition OF
| this company, while properly criticising
whatever he deemed criticisable, omitted to
/ state the o her side of the case, and in addt-
| ton unfortunately so stated his criticisms as
/ to make Ii proha Dls that you may have mis-
understood and overrated thsir Importance.
Some Mistakes Inevitable
| desire to reiterate my disclaimer of in
| fallibility and repeat the message sent from
/ Europe last summer that in business of our
magnitude mistakes are inevitable and we
compare favorably with others; but my in
/ tegrity Of purpose cannot be shaken. General
net results are the touchstonss In every bust
ness. We need not go far to find confirIna-
lions Of this. Errors have been made per
haps in the management Of every com.
| pany doing business, but as there are some
of common notoriety / may refer to them
| without seeming to attack the com
| panies themselves. In addition l will say
| that to the best Of my knowledge and belize
| al tof these cases sre natural experiences, in
cident to the fact that no enc Is infallible
| The Connecticut Mutual lost outright $4,000
| through the defalc ton Of its fina cial cor
| respondent at Indianapolis In 1883. TIL,
| Mutual Benefit Life Insurance Company, q
Newark, n. j., company eminently con
| sentative IN all things. lost about the saml
amount on Elizabeth, N. j., bonds II is
| well known fact that the Equitabl4 Life As
| surance Society marked on in 1889 and les
i almr st Sl0O0,O0G on real estate, and that i
carries nearly S2,0O0O00 In its published
statement Of Rssests and surplus al
''c0mmuted commissions" agency ba
lances,n etc, which Is practically another
form Of expressing what the Superintendent
calls q debit in the case Of u. @
| Nanuxem * Co In the report of the depart
ment examination Of the Mutual Life lnsur
Ance Company made in 1888, IL WAS state,
| that $3.50, 70l.43 had been charged of to prof
and loss on account Of its office buildings
After naming these cast land others Nigh
be referred TOT we have simply recited lis
! of average errors, which in proportion to tn
interests at stake. represent less loss than tn
experience of any business OF which ] hav
! kno wledge and with which the Management
OF the New York Life Insurance Compan,
| invites comparison
Preferred In one Of the opening paragraph
Of this letter to the new and and larger re
sponsioilities which have been met to the hes
of our ability within ten,years- Among thes
! has been the growth of certain evil practice
! in che conduct OF the business of life insur
| ance. Several suggestions for their remed,
| have been offered, but for their complete re
/, fern II does not seem to me that any ade
, ! quate remedy has yet been named Tn
| worst practices the most demOrali1ing ant
In every wav the most re prehepsible, are ia
giving of rebates to insurers. and the more o
! less constant attempts of companies to entc
into their own service the agents Of competi
tors. This is natural result OF nerce com
: petition, and in my judgment should b
! speedily eliminated.
Z A Remedy Suggested.
And it seems to me that the one and all
sufficient remedy would be (and ] d-sire I
go on record as indorsing that plan) to limi
by statute the amount OF Insurance that
: company shall place upon its books Tina
amount having been reached, the incentiv
I Of that company for obtaining new bushes
i is entirely taken away and it Is PRACTICAL