The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1903-05-20
DAVIS REPLIES.
President Kansas Mutual Life
Makes Statement.
Says Report Trustees Compiled
In Part
BY UNFRIENDLY HELP,
Amateurs and Those Unfamiliar
With Insurance.
Yet Finds Company Solvent and
With Surplus.
Answers Charge NepOtism and
Excessive Expenses"

President Davis of the Kansas Mutual
Life Insurance company this afternoon
issued a statement in reply to various
reflections on his management referred
to in the recent report Of the trustees of
the company.
He says that the report was compiled
in part by amateurs. by unfriendly help
and that some of the errors in it are
natural because the compilers were not
familiar with the insurance business.
He says that had the persons VINO
harassed the company with litigation
not demanded by policy holders, used
their influence to assist in upbuilding
the Company. the present condition Of
the company would not exist, and that
notWiths tanding inferences to the con-
trary, the trustees were obliged to find
the company solvent and with a sur
plus. Mr.. Davis says:
To the Editor of the State Journal:
The report of the trustees of the Kan
SaS Mutual Life Insurance company
just made public is gotten up in such a
peculiar way that a brief review of it
seems to be proper and Justihable l
therefore request the courtesy of space
for that purpose.
Instead of making a straightforward
statement of the company's business, as
required by order of the court, the trus-
tees have gone further, and by a Ia
bored effort of mixing and juggling OF
figures, they have undertaken, as the
pO4lllClduS WOulQ say. TO fIldkS out a
case against the other side.
It will be observed that a special
effort is made to show that a large
amount of money has been paid to the
officers of the company and to members
of their families But it will be no.
tlced that no charge is made that any
one of them was inefficient or did not
earn the money received for services
Replying to the charge of family
affairs. we find many we'll established
precedents. BY referring to many of
the banks of this state and other large
nnanelal corporations throughout the
country. we and sons and other rela-
tives filling responsible positions with
credit to themselves and employers. II
one Of the large, popular and well
managed eastern old-fine companies. a
son of the president occupies the posi-
ton OF secretary with the company.
Two brothers and two sons of the vice
president hold lucrative official positions.
Many other similar cases might be cited.
Sufflce 1t to say that I have ne apol-
ogy to offer for my two sons having
been employed by the Kansas Mutual
Life; A. l. commencing over Is years
ago at salary of $55 per month. which
was gradually increased after several
years efficient work to 800 and to S125. the
latter part of 1902 Byron H took a DO
Sltlon With the company about Is years
ago at $50 per month. His salary was
also gradually increased to $780, and a
L
add that his work for the last seven
years pertained largely to inspection of
real estate loans Several hundred thou
sand dollars have been invested on his
report and advice. and not single dol
lar of loss has ever occurred on any of
the company's invested funds There
has no complaint been made and can
not honestly that these young men
were not capable, nor that they did not
earn every dollar of money received.
a n off 7-a,.4
much larger salary to do similar work
for an investment company, but out of
loyalty to his father and the Kansas
Mutual Life declined the proposition.
In the earlier years of the company,
r. T. Herrjck was selected by ex-Gov-
ernor Morrill, as the company's attorney.
Some years thereafter he married my
daughter, which the board of directors
did not consider as impaiTing his use
fulness to the company or justifying his
withdrawal from his official position.
He started at S400 per annum; was
gradually increased to six. then nine,
and several years later to twelve hun
dred dollars, with extra pay and ex
pense when in the employ of the COM
pany out of the city.
Quite a per cent. Of the amount Of
the report of the trustees showed he re-
ceived during the year 1902 was earned
prior to that date. but number of the
cases had not been closed and the money
paid to Herrick until the year 1902. As
an evidence that Mr.. Her-ick was nor
overpaid by the directors of the Kansas
Mutual Life, less than year ago he
was offered by another old-lne cOnnpa ny
a salary of 5000 a year, with the as
surance that 1t would be gradually in
creased to $4,000. This he declined.
having decided to open an Office of his
own in Kansas City Mo.
As to my salary, the report shows that
for twenty-One years service, SS7, ,22S. 35
was received In this aggregate is in
cluded $3.433.31 expense account incurred
during the entire period of nv conn5c-
ton with the company, an itemized
statement of each expense account be
inc on file It is not to be assumed
that the president while away from
home in the interest of the company
should bear his own expense
During the earlier years of the com
pany, when my salary and that of my
associates was very meagre, by an
agreement with the board of directors
we were to receive additional remun-
GRAFTON later on, which was paid in &C
cord with said agreement. Deducting
the expense account from the total
amount received by me. makes the
average salary for twenty-one years q
/ little over $500 per annunn- The pres
idents of several Of the smaller life in
surance companies receive from five.
ten to fifteen thousand dollars per an
mum; and of the next larger or middle
grade of companies twenty twenty
] i've ~ AAAt4 AHO4SdA4 ApA11AS RE4 dA4
mum; and of the larger and older com
panies fifty. seventy-f7ve to one nun
dred thousand dollars.
I have no fear of comparison and do
not know of an executive officer Of any
/ company who has rendered similar SER
/ vice for p years at so small an income.
may be pardoned for stating that men
capable of organizing, building and
managing a life insurance company or
other large financial companies are not