The Dickinson press., 1902-05-10
1t will come. not as a compromise, but
as a reward for honesty. industy and
efficient service.
0nce Assia q Fsrmers' Mstssi lnssrsace
Company Disappears, After Do
iNQ Coosjdorabjo DAMAGE.

Company Disappears, After Do
Ing Considerable Dsmses.
A gentleman we'll posted in mutual in
surance makes the following comments:
North Dakota seems to be the hot bed
for fake mutual insurance companies.
Several of them have been organized by
professional grafters. They have flour
ished for n or two years. az hest suited
their purpose, and quit with a good sum
of the farmers money in their pockets.
Among these was the western Mu.
tual Fire Insurance Co." Of F'essenden,
organized in 1907. which did a flourish
ing business in 1850. when it was placed
in the hands of a receiver by the district \
court. The receiver in this case being
unable to make collections with which /
to pay the claims. finally sold all the as
sets, at auction. There was about $780,
600 in claims against the company,
mostly farmers who had losses. After
the expense Of the receiver this wreck
will paw about three cents on the dollar.
The Red River Valley Mutual
Hail Insurance Co.. organized at Wahpe-
ton in 1897 by A. NJ. Glider. did an ex-
tensive business in 1893, writing five year
policies to the amount, in premium notes,
OF $4,000. In 1890 this was also placed
in the hands of a receiver with claims
held bv farmers for losses sustained to
the mount of about $4,000. The mem.
bers refused,t ITO pay the assessments with
the result that the assets we're sold bv
order of the court and the receiver after
paying the expenses of closing the bust.
ness, and paying costs and attorneys fees
in a lot of litigation. was only able to pay
about 8 cents on the dollar to farmers
having claims for losses.
Probably the most gigantic of all the
fakes was the State Mutual Ins. Co., or
gained also by A. NJ. Glider, at Hankin-
son in 1900 and which in the season of
1901 took more than $4,000 of premium
notes. The state was canvassed from
one end to the other by experienced in
surance sharks" This concern sus-
tanned losses by hail during the season
of about $4,000. They collected on
their premium notes before December T.,
1901, about $4,000 in cash; of this
amount about $4,000 was paid to policy
holders having claims against the COM
pany for ~.losses, and the balance was
taken by the grafters to pay expenses,
salaries, commissions to agents, and
other incidental expenses peculiar to this
business. And all that was left with
which to pay the balance of the claims
held by farmers for losses sustained by
hail, was a lot of worthless assessment
notes, that in most cases are uncollect-
able, and which will likely pay from 3 to
5 cents on the dollar. This is certainly
a cheerful prospect for farmers who have
lost all their crops by hail and were de-
pending on their insurance in this COM
pany to provide them with funds. BY
the time this has gone through the courts
and the expenses are paid, and they have
waited a year or two, creditors may re-
ceive from : to'5 cents on their claims as
in the other companies of this nature.
In the mean time the men who did the
business, after getting all that was in it,
depart to seek pastures new and a fresh
crop of suckers. Thus verifying the doc
trine of p. T. Barnum.
1t would seem that there is something
wrong with the laws of this state res ulat-
ing concerns of this nature. 1t, appears
that there are no restrictions as to the
amount of money that the g~rafters can
take for expenses. The bars are down
and they are invited to help themselves,
and when they have taken all they want,
they invite the farmers to help them.
selves to what is left. All that is neces-
sary under the statute is that they incor-
porate and have the required number of
directors-and anybody a be a direc-
tor; there are no qualifications, financial
or otherwise; they do not have to be
worth one cent. There is no provision
for %anyone's undertaking, or being re-
sponsible for, the faithful performance
of the company's duties.
There are certainly some changes that
could be made that would stop these
mushroom companies that rise up and
flourish for a day and disappear. Would
it not be we'll to require men applying
for a charter to do an insurance business
in the state to file with the commissioner
Of insurance a good and sufficient bond
to the amount Of at least $4,000; and
this bond would be liable for any mis-
conduct in the management of the COM
pany. And also to limit the expense Of
management; to fix the commission that
could be paid to agents, the salary of
officers, and to specify for just what pur-
poses the funds could be used to require
that the board of directors and everyone
connected with il: should be men of in
tegrity. And making it the duty of the
commissioner of insurance to investigate
carefully the character of all parties con.
nected with a company that applies for
a license to do business in the state.
There are also a few changes that could
be made regulating the manner of clos
ing up the concerns that become defunct
at a less expense, increasing the power
of the commissioner Of insurance to
prosecute for any violation of the insur-
ance laws.
Weather Report of April.
Maximum temperature Is degrees on
| 27th.