The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1901-07-14
No MISTAKE MADE
ACTION OF ENDOWMENT RANK IN
DoRsED BY AUDITOR HART.
Pythians Seized the Right Horn of "a
Dilemma When They Kept Away
from a Receivership.
FRATERNAL INSURANCE THEORY
PRESENT TABLE OF RATES WILL
WORK OUT ALL RIGHT.
Course Pursued by the Rank Should
Have Been Taken Two Years
Ago. the Auditor Says.
STATEMENT MADE BY HINSEY
CHANCELLOR FETHERS AND OTHERS
CHARGED WITH ANIMUS.
Long Explanation of Financial Trans
actions-Head of the knights of
Khorassan Forced to Resign.
1.-The Endowment Rank, Knights OF
Pythias, had the usual two horns to its
Course Pursued by the Rank Should
Have Been Taken Two Years
Ago. the Auditor Says.
STATEMENT MADE BY HINSEY
CHANCELLOR FETHERS AND OTHERS
CHARGED WITH ANIMUS.
Long Explanation of Financial Trans
actions-Head of the knights of
khorassan Forced to Resign.

Pythias had the usual two horns to its
dilemma" said State Auditor Hart last
night. lone horn was to raise the amount
of it's deficit by an additional assessment,
while the other was to go into the hands
o. a receiver. Because Of the affiliation of
the Endowment Rank with the general or
der of Knights of Pythias a receivership
would mean taking control by the courts OF
all the affairs and property of the Knights
of Pythias throughout the United States.
THE Supreme Lodge has acted in very
sensible and honorable manner to its MEM
bership in concluding TO raise the rates in
accordance with the table of the Fraternal
Congress. which is an association of the
better fraternal companies of the country.
BY this the affairs of the Endow-
ment Rank will in a few months be in
splendid shape so that its delinquent death
losses will be paid and the mortality of
the future provided against.
Two years ago. when the fraternal in
surance law of Indiana went into effect.
accepted the financial statement of the En-
dowment Rank, but felt considerable hesi-
fancy about it. / only concluded to accept
the statement when 1 was assured of the
responsibility of the entire order for the
financial affairs of the insurance depart
ment. This year when the financial state
ment was presented there had been some
material betterment in that the order
showed an increase of 5000 members and
was In no worse financial condition than
II was two years ago, but i refused TO issue
a license TO the rank. i consented, how
ever that 1t might transact business in
Indiana until after the examination of its
aHalrs was completed by the insurance de-
partments of Illinois and Connecticut and
the report Of that examination was acted
upon by the Supreme Lodge.
STRICT BUSINESS METHODS.
Il think that under the management of
Mr.. Neal, Of Lebanon, the new president
of the board of control of the Endowment
Rank, strict business methods will prevail
and there will be no investments in the
shape of second mortgages and / am quite
sure no personal pull on the purse-strings
OF the rank will be tolerated"
Auditor Hart expressed amazement at
the looseness of business methods that
characterized the management of the En-
dowment Rank before the recent investiga-
tion Why any board of directors should
nave permitted such an investment as was
made in the Lexington HOTEL he said.
and in half a dozen otner items that went
10 make up the ranks so-called assets is
more tnan any sane person can under
stand This all grew out of too much one
man power and superabundance of
hypocritical brotherhood"
1.-THE truth is" continued the state audi
tor, with gathering emphasis. there are
scattered over the country a number of
masters In grips, rituals, passwords and
brotherly ethics for the purpose of organiz-
ing fraternal insurance schemes and so
long as they have control and can get on
the salary list everything is 10 them at
least, prosperous. 1t is not & question of
rates that will perpetuate the company and
protect the members, but 1t is altogether a
matter as 10 the collection of an expense
fund that will provide for their recon-
pense
The fraternal insurance companies gen
orally, however, have come to a recognition
OF the inexorable truth that death natures
certificates in a fraternal company lust
the same it does in any other insurance
company, and. unless rates bear some re-
lation TO the mortality, it is only a question
or very brief experience until disaster is
written across their horoscopes.
And so the older companies that began
on light mortality cost have, in many in
stances, increased their rates, and a num-
Der OF others are contemplating such a
change. AT the last session of the Indiana
Legislature the minimum rate law, a crea-
ture OF the wisdom of the National Frater-
nal Congress. was Incorporated into our
statutes, so that hereafter no fraternal in
surance company can come into Indiana un-
less an amount equal TO these rates at
least is charged against the mortality cost
20 the membership.
FRATERNAL INSURANCE.
THE decision of the Supreme Lodge at
Chicago this week 10 raise the rates Of in
surance in the Endowment Rank was an
action that should have been taken two
years ago, and the experience OF the future
will demonstrate that any fraternal order
that does not charge these rates, based up
on experience. is flying in the face of seri-
Gus trouble.
The theory of fraternal insurance is
that il cannot be conducted at a profit and
il is due the fraternity that whenever any
one connected with the executive features
OF a fraternal insurance society is manipu-
lating its finances for personal gain, either
in salary perquisites, he shall be at once
dismissed and, If criminally responsible
cashiered. The Endowment Rank cannot
do anything more wholesome for the fra
ternal interests of the country, TO say moth
ing OF the question of justice TO the MEM
bership of its organization, than TO go to
the very bottom Of the peculations which
have brought this great deficit. and see TO
for what is evidently a great crime"
The state auditor still has confidence in
the Endowment Rank. despite the dis
closures in the report OF the investigating
committee presented to the Supreme Lodge
at Chicago last week. Il believe now, as |
always have believed" he said. that a
policy in this Endowment Rank will never
be diShonored. because back OF every GER
tifcate is the Endorsement of the great
der OF Knights OF Pythias throughout the
United States. and it's resources are abun-
dantly able 10 make up this deficiency, and
| believe the members will cheerfully re-
spond To the plan proposed by the Supreme
Lodge at its Chicago session. Whenever
this is done. the order will be licensed In
Indiana, and until il IS done IL Will be per-
mitted TO transact business In this State
by sufferance, or, in other words. so long