The San Francisco call. [volume] (San Francisco [Calif.]) 1895-1913, 1895-07-03

III the superior court. ne commissioner
gave it as his belief that the laws are too
lax on this subject and should be amended
so that any impairment of the capital stock
would render a company insolvent.
The Mutual Relief Association of Peta-
luna, which has been doing business as an
assessment association for many years
without reporting to the Insurance Com
missioner, has received a severe criticism.
The association has been sued by the
Commissioner who received the following
letter from its secretary:
MUTUAL RELIEF ASSOCIATION OF PETALUMA.
PETALUMA, Cal, May %, 1893.
Dear. Sir: Our present membership, l am
sorry TO say, Is only about 500. OF course TINS
is great decrease, but it seems impossible to
AVOID II In any way, and If 1t continues we
Will IN time be compelled to divide up our
spoils, when the few remaining ones will reap
the benefits. Respectfully,
n. DINw1DDIE, Secretary.
On this communication the following
romment is made in the report:
The idea OF secretary speaking of the accu-
mutations OF the honest and conhdlng policy
holders as "spo1ls," apparently gioatlng over
the prospect that the few remaining members
will be benefited by the wreck OF the assoeia-
ton!
Highway robbers around their campfire in
the mountains gloating over the results OF
their depredations which probably caused the
sacrifice of many lives, never spoke more I'M
feeling1y or defantly OF their "spolls' than
whose object is "tO secure to the families or
friends OF deceased members such pecuniary
aid as shall shield them against the ills attend
ing those who are left unprotected, ana at the
same time avoid such expenses as would i'm
poverish its members or place the society be-
yond the reach OF those needing its aid, and
also to afford safe and economical deposit for
those wishing TO accumulate sum for future
use for themselves or families"
This is an exceedingly good place to deposit
hard-eaTned wages 'foT future use"
~
| the precaution to assess all real estate rep
resented in the assets of home insurance
companies.
The law requiring all statements, ETC., of
companies to be made in gold coin of the
United States had never been enforced un-
til recently. The report continues on this
question:
Consequently the annual statements of the
| companies were made either in the money of
| the country where organized or in Mexican
money. The annual tabulated report there
fore, lacked uniformity, the statements were
sons, and when in Mexican coin were grossly
misleading, so much so that one company was
compelled to withdraw from the state when
the report was made in United States coin.
With regard to cost of life insurance, the
| Commissioner states that it is the almost
universal mistake of assessment aSsocia-
tons to promise more than they can
perform, that is TO offer too much for the
change made.
The tendency IN the larger companies is to
high-priced lines and large policies and the
Interest Of the small policy-holder and the old
time life policy has been sacrificed IN the mad
rush tor supremacy on the lines now in vogue.
The dividends of the regular lines have de-
creased, while the expenses of the company
have increased, and all to meet the demand
made necessary by the fashionable form OF
policy and the ambitions of the men who own
or manage the large corporations.
The annual statements OF tWenty-eight OF the
leading life assurance companies show that
during the past year they increased their assets
over $4,000 900, their net surplus nearly
{25) 900 600, their income SIT, 600 600, while
they decreased their dividends several hun
bred thousand dollars. The expenses have in
! creased on the average about 20 per cent in the
last twenty years, and i'll some OF the COM
panies have more than doubled. This great
increase is especially notable in The companies
whose chief aim has been volume, thus show
ing conclusively that the interest OF the old
and constant policy-holde- is sacrificed for new
business.
The three "giants," as they are called have
now ST., 600 900 surplus. This enormous sum
is rapidly increasing, and is drawn from the
hank accounts and incomes of the average
citizen, and beyond 81 reasonable sum to meet
any excessive death losses, caused by an cpl
demic, is not necessary. and in fact Is detri-
ment to the people at large and e source OF
danger TO the State and Nation, owing TO the
rapaciJy of Legislators and public officials and
the infamed ambitions Of those who control
it. This surplus is popularity supposed to make
q policy-holder's contract secure, but if the
theory OF life insurance Is true, every policy
is absolutely secured by the reserve, and if
company were to cease writing new business it
could meet every obligation without requiring
dollar OF its surplus.
The general public is interested in competi-
ton along safe lines, and to secure this meas
ures should be taken By the Legislature that
| would insure the safety and prosperity of all
companies but which would at the same time
secure the people against the evil effects OF an
improper use OF their own money.
The Insurance Commissioner, after max
ing careful examination of the law. feels
convinced that Lloyds are entitled to ad-
mission upon complying with the statutes.
The subject of legislation is reviewed at
considerable length. The bills introduced
in the last Legislature are stamped as
'.cinch bills, pure and simple" ana the re-
port continues further on as follows:
sincerely believe and advocate reasonable
deposit from all foreign companies doing bust
ness in this State for the protection and con-
venience OF judgment creditors as well es to
prevent unjust adjustment OF losses through
fear OF expensive litigation in foreign eoun-
try, but that one American company should
have $50 900 OF its policy-holders' money
in foreign countries is. TO my mind, danger
ous condition OF affairs. The argument that
the liabilities in those countries exceed the de-
posts and investments, does not remove the
objections, for the liabilities of life company
are so easily shifted in case of trouble between
countries that the deposlim1ght easily become
q contraband of war. l think the subject de-
serves the serious consideration of ali inter
ested.
Attention is called to the "many hum
bugs and frauds masquerading as frater-
nal societies" in the following language:
II they were not supported almost entirely
b. the poorer class OF people it would call for
less indignation, but where the burden falls il
is hardest to be borne, and they upon whom il
falls have right 10 expect protection from
such evils.
California has many organizations of this
character whose history in this State began
and ended with the filing of incorporation pa
pors bur which, through the glamor of her fair
name and the freedom from investigation
which great distances give, are doing u thriv
ing business in other States.
The report concludes with a financial
statement of the Insurance Commission
er's office, which shows receipts from taxes
and fees, SO, 934 Is; expenditures, $3.50 70; |
balance on hand, SIC, 1873 81.
HERMANN WANTS DAMAGES.
II sa TsIyt