The Birmingham age-herald., 1903-06-19
COMMISSIONER
 MAKES REPORT
Document Contains Interesting
 Insurance Data for 1902
RECEIPTS SHOW INCREASE
State Insurance Commissioner Makes Important Recommendations for changl- Laws Govern
 ing Companies.

Montgomery, June 1s.-(special)- 1.-The printed report of the state insurance com missioner has been received in the office of the secretary of state and is ready for distribution. This Is the annual report made to the governor and covers the year ending December S1, 1902. The report Is an interesting document, containing abstracts of the statements of all insur- ance companies reporting to the depart ment, showing receipts and disbursements for the year. The receipts of the depart ment are shown to have been S6e,Ss2 an increase of nearly 65 per cent in five years. when the insurance business was trans ferxed from the office of the auditor to the secretary of state.
 Heflin Compliments McDavld.
 MT. Hehin compliments very highly Deputy Commissioner Ned R. McDavid for the healthy condition of affairs. and makes some interesting recommendations to the governor for changes in the insur- ance laws. One of the most important of these is for a statute to prevent un- authorized companies doing business In the state. Tbe commissioner says:
 "In my opinion the state Is deprived or considerable revenue by permitting un- authorized insurance companies to trans act business in Alabama. This law re- ouires that the assured must pay to the insurance department 1 per cent tax on the amount of premium paid the unau- thorized company, but since the creation of the department in 1897, only cents has been received; though am satisfied thou sands of dollars are due from this source. There Is no penalty provided Tor non compliance. It occurs to me that It IS unjust to the reputable companies that enter Alabama and comply fully with all laws and pay all taxes imposed, to let wild cat insurance companies operate in the state, complying with no laws and paying no tax
 Another important recommendation Tor change in the laws relates to the prac- tice of municipalities levying license taxes on companies complying with the state laws Regarding this the commissioner says:
 System Not the Best.
 1T am impressed with the fact that the system of taxation of insurance com panies in the cities and towns of this state is not the best The state charges every company $101 license. and per cent.
 
 on the gross amount of its premimum re- ceipts, besides exacting license Of SS.5O for each of it's agents. These charges are very reasonable and proper, bpt the state permits its municipalities to unrestrained- ly tax the companies. and many of them | appear to abuse the privilege. These H. | censes are levied regardless of the amount of business a company may do in the municipality, and thus tends to create a trust in favor of the companies already | established in the State, and, therefore. discourages competing companies from en- tering, for usually a number of years are required for a company to organize a | large and profitable business in local l ity IT in lieu of a license the state law required the municipalities to levy tax on the gross premiums, not exceeding a l certain per cent, the companies with large premium receipts would be forced to carry their pro rata of the burden, the companies with small business theirs, and the new companies would be encouraged | to enter competition"