Northern Wisconsin advertiser. [volume] (Wabeno, Wis.) 1898-1925, 1903-08-06

commissioner will be carried through
the courts and fought bitterly to the
end.
! Statute Provides for Division.
I The decision of Commissioner Host
reviews the Wisconsin insurance legis-
lation in point from 1870 to the present
time. The section on which the deci-
sion is based, section 1852, statutes OF
1898, is as follows:
Every life insurance corporation
doing business in this state upon the
| principle of mutual insurance, or the
members of which are entitled to share
in the surplus funds thereof, may make
distribution of such surplus as they
may have accumulated annually, or
once in two, three, four or five years
as the directors may from time to time
determine. In determining the amount
OF the surplus to be distributed there
shall be reserved an amount not less
than tie aggregate net value of all the
outstanding policies,' said value to be
computed by the American experience
table OF mortality with interest not ex-
ceeding four and one-half per cent"
Commissioners Decision.
In his decision Commission Host
says:
Il am of the opinion that it was the
intention of the legislature that said
section 1852 be mandatory, and that
in its enactment the legislature had
| in
ing proper protection to policy holders.
To construe said section 1852 as per-
mlssive, would make it of no effect and
nullify its every purpose. The law pro-
vides that the directors can determine
whether such distribution be made
once in two, three, four or five year
periods instead of annual, and speci-
fically provides what funds shall be re-
served, in determining the amount of
surplus to be distributed If permits
slve, there is no sense in giving to the
directors the option of selecting either
a two, three, four or five year period,
instead of annual, nor was it necessary
to determine the amount of surplus to
be distributed by requiring the reser-
Walton of certain funds necessary for
the solvency of the company. Such a
law mandatory in it's character, was
necessary for the protection of the
equities of the members who compose
these mutual corporations. Such cor
porations are the creatures of the
state, which has the right to prescribe
the conditions under which they can
transact business and can only exer-
else their functions within the limits of
the states permission; and when the
state says to those mutual life insur-
ance corporations you may distribute
your profits annually or once in two,
three, four or five years as your board
of directors may determine and then
defines in fact what constitutes the
surplus to be distributed, it is my opin-
ion that the state has issued a direct
mandate, leaving discretion only as to
the period which may be selected with
in the maximum of five years.
Charter Also Favorable.
The decision quotes also the charter
of the company, which provides for the
division of the surplus with the policy
holders, as partners in the compan.
The decision concludes:
"In view of the foregoing facts, it is
my decision, that the word may as
used in section 1862, Wisconsin stat
utes of 1898, means must and that
said section is mandatory, and that the
provisions of said section must be
complied with by every mutual life in
surance company transacting business
in Wisconsin; and it further appearing
that said Equitable Life Assurance So
ciety of the United States has not COM
piled with said section 1852 so con-
strued;
81 further decide, That the Equitable
Life Assurance Society of the United
States, of New York, has violated said
section 1852, as charged in the COM
plant of the plaintiff, by not comply
ing with the provisions of said section.
Therefore, hereby notify the Equit-
able Life Assurance Society of the
United States that, if statement sign
ed by the proper officers of the com
pany, that there will be compliance
with section 1852 as herein decided be
not fled with this department within
the period of 30 days from the date
hereof, the license of the company to
transact business in this state, will be
revoked at the expiration of that time"
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