The herald., 1898-03-22
OFFICE OF THE HERALD.
Los Angeles. March a.. 1895.
"Folly always deserves its misfortunes.'

IRONY Always uosotSoo A'S N'a'AoA N'a'AoA euAAoS'
The taneIe In the affairs of the Bankers
Alliance bids fair to become disastrous to
the policy-holders. Not only are their ex-
listing policies practically worthless, but
the holders OF them are liable to be as
sessed to pay up the claims that now ex-
1st against the association. The first Of
these assessments has already been de-
termined upon. and the notices will be sent
out to the policy-holders within two or
three days from this date The response
TO this assessment will settle the fate of
good many policies. The members who
do not walk up to the captains office and
SETTLE or who, In other words. do not pay
the assessment levied by the receiver, will,
of course, forfeit their rights to any bene-
tits under their policies, and everything
they may have paid in from the first win
be sacrificed. That Is one beauty of the
assessment scheme of insurance" The
pssured must pay up an amount that is de-
termined without his knowledge or con-
sent. and he has no means of knowing be-
xorehand how much that amount will be.
In this case only those members who re-
spond promptly to the receivers call will
be IN good standing, and the money they
pay IN Will be used to settle, In the best
manner possible, the outstanding claims.
The assessments will have to continue
3ust as long as the funds on hand are In
eunicient to pay maturing claims and
claims already matured. The unfortunate
policy-holder is in an unenviable dilemma.
II he refuses to pay tho calls, he neverthe-
less cannot get rid of his liability, II he
have any property subject to execution:
and by refusing he forfeits, as above
stated, whatever rights might be his. On
the other hand. by paying up he has no
assurance that when his own claim ma
lures money enough can be collected to
pay It,
According to the receivers report, made
9TH ult., the liabilities existing at that date
amounted to $13S, .63, nearly all of which
consisted OF claims under policies issued
BY the association. To pay this amount
there was $15,0sS.S3 cash scattered in vari-
Gus banks, after allowing $114092 due from
suspended banks; and there Is also $10,-
900 deposited in the hands OF the state
commissioner OF insurance. The office fur
niture, charged on the books at $2726 81. is
put IN the inventory at S400. This would
leave an apparent deficit of over $l13.0
to which would have to be added current
expense and the amount of any claims
that may mature further against the as
sociatton on account of death or accident
or course there Is q big lot Of bills re-
ceivabie, premium notes and other truck
that has heretofore figured in. the compa-
ny's statement to give 1t solvent aspect,
ana OF these items, figuring nearly hun
dred thousand dollars, the. receiver says
that from Information received from the
Officers of the Bankers Alliance 1t is prob
able that these accounts of sundry agents,
bills receivable, premium notes and re-
serve fund notes have no value"
Receiver Washburn has, however. added
10000 cash to the assets of the concern
by visiting Chicago and collecting the
amount from the Chicago Guaranty Fund
Lie society of that city. That company
had a1 n
the Bankers Alliance. under the terms of
which very favorable arrangement for the
local company seemed assured-on paper.
1t turned out that the Chicago Guaranty
was not acceptable to the policy-holders
OF the Bankers Alliance, and 1t also turned
out that there was second or secret con-
tract existing between the officers of the
two companies. 1t was the discovery of
this secret contract, and the pressure
brought to bear through the knowledge of
Its contents, that moved the Chicago Guar
anty Fund Life society to turn over and
pay to Receiver Washburn the neat little
sum of $4,000 in return for which he gave
them promise that he would not disclose
his knowledge or interfere with them in
any way in regard to their carrying out
the contract they had made.
Now, with regard to this contract and
to the one made later with the Mutual Re-
serve Fund Life association, few words
may suffice. A great deal more has been
said and printed upon this part of the SUBJ
5ect than is at all necessary. The policy
holders OF the Bankers Alliance are not a
flock of sheep that can be bartered or sold
by the receiver. Every one of them is
Tree to act as he pleases His standing in
his own tottering company has already
been explained above. If he still bankers
after assessment insurance, he will find
plenty of companies willing. and even anx-
m, tn lrn n tv.r {r Lyov~ r.
to accept the Chicago Guaranty's offer.
And the offer of the Mutual Reserve is not
tempting one. The concern is doing an
enormous business, at greatly increased
cost to the assured and 1t does not offer
any appreciable reduction from it's own
regular rates to the Alliance policy hold
ers, and, moreover, will charge them its
rates Tor their present age and require
them to pass another medical examination
The benefit that will inure to the Bankers
Alliance Will be that the Mutual Reserve
will pay to Receiver Washburn the regular
commission of 65 per cent of the first years
premium and a smaller commission on each
succeeding years business. These COM
missions will, of course, go to the general
fund, and will make assessments little
lighter.
But If the Bankers Alliance victims do
not want the Mutual Reserve peoples poll
cies they are under no obligation to take
them. They must look the situation in the
face and decide their course of action as
II they were insuring for the first time.
They have these advantages: they have
learned from experience that assessment
insurance is not as cheap as 1t looks and
that 1t lacks the desiderata of permanency
and solidity.
Sales by the San Francisco investment
board on Saturday were: Hutchinson
Plantation at 60%, Market Street railway at
b2h, San Francisco Gas and Electric at
30, and Vigoret Powder at 3B.
At the San Francisco stock and bond
exchange Edison Light 6's sold at H81,
Hawaiian Commercial at 3l% to 31T,
oceanic Steamship at 5S, Giant Con. Pow
der at ~ to 42A, and San Francisco Gas
and Electric at 90 to SsN.
o o o
The Boston Pneumatic Tube company
mas applied to the gas and electric light
commissioners for authority to issue new
stock 20 the extent of 900 for the ex-
tension tsa SIC OF the system. Present capital is
A rumor comes from Cincinnati that
deal Is being worked there for the cons6l
iuutton OF all the spirits manufacturing
companies independent Of the American
Spirits Manufacturing COMPANY. viii =
p: Greenhut at the head Of the new com.
btnation. &. 1--
o o
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