Audubon Republican. [volume] (Audubon, Iowa) 1894-1925, 1904-01-21

banks in which these funds are de-
posted shoHld not pay interest to
the State uron balances at the rate
which they customarily pay to other
depositors. Each bank gives bond
to indemnify the State against loss.
and there would be no additional risk
involved in requiring the payment of
interest. The State, under the pres
ent law, Is deprived of a revenue, of
from twenty to thirty thousand dol
lars per year from this source. which
ought to be used in the reduction OF
general taxation.
believe, therefore, that the law
should be amended so as to provide
for taking interest upon balances, II
such arrangement can be made. The
amendment should also provide that
the State shall pay the premium to
a surety company for the Treasurer
bond. The bond required OF him Is
too large for personal sureties. and
the premium to a surety company, IL
paid by him. would more than con-
sumo his entire salary.
insurance.
I call especial attention to that part
of the Auditors report relating to in
surance In the development Of the
State, the supervision of insurance
companies, which has been given to
the Auditor, has become the most
important work OF his office. The in
terests involved are not only large,
but they deeply concern a great num-
Der OF our people. I was formerly OF
the opinion that an independent in.
surance department should be Great
ed, but | have changed my mind, end
I now believe that the wiser course is
to leave the work where 1t Is, giving
to the Auditor authority to employ
a force sufficient to transact the bust
ness in an efficient way.
concur in the recommendation OF
the Auditor that he should have the
authority to employ at yearly sal
airy an examiner and actuary, with
such other clerical assistance as may
be necessary. II Is impossible to en-.
gage a competent man for the exam.
nation of an insurance com Dany for
the compensation now authorized:
and there Is no practicable provision
of law fer the employment OF an &C
tuary. The people ere vit"ly inter
ested IN knowing whether the insur-
ance companies with which they deal
ere solvent or insolvent. and when
the time comes for an examination,
it is Of no value unless made by an
upright, competent. and sktlful ex-
aminer and actuary.
| concur also in the recommenda-
tiOn that an effort be made to define
what a contract Of life insurance Is.
In these DAYS Life insurance takes on
so many phases. and the ingenuity
of managers is so great, that every
kind of indemnity and investment,
fair and unfair, honest and fraud
ulent. is offered to the people as life
Insurance. | believe that a statutory
definition can be devised, broad
enough to embrace every legitimate
contract and that would facilitate the
work of the Auditor ia excluding
contracts which are either fraudulent
or which belong to some other field OF
enterprise.
| concur most heartily in the recon-
TendatiOn relating to reinsurance or
consolidation. 1t is highly necessary
fer the protection of policy holders
that the State shall determine the
conditions under which one company
shall be absorbed by another.
Other recommendations made by
the Auditor, have not time to com
ment upon, but they merit careful!
consideration.
Upon my own behn!f | earnestly
urge upon you an amendment to the
law which shall provide that all fees
paid by insurance companies for ex
aminatiOns, or for other service rem
dered under the direction OF the
State, shall be paid into the State
treasury. and that whatever com
pensat:on is allowed to those who
perform the work, shall be paid BY
the State. AS the law now IS, the
insurance companies pay to the ex
aminers whatever sum may b.
charged for service and expense, ant
the examiners make no account Of /
whatsoever. This practice affords OF
portunities for wrongdoing that ar,
intClerabie in state which cherishe
a reputation for integrity and fai
dealing. Whatever the State doe
through any of its officers or agents
for which fee Is prescribed, Shout
be paid for by the person or corpora
ton from which the fee Is due, direc
ly to the State, and whatever tn
should be paid by the State, and tn
books of the State ought to sho
tae oxact transaction.
am led to comment upon this su
ject with unusual emphasis, large
on account of some matters whiC
occurred during the four years
which Frank f. Merriam was the A
ditor Of State. Toward the close
his last term it was charged by val
GUS foreign insurance companies tn
: he, together with his insurance exal
!, iner, Mr.. Max Beehler, had made,
= pretended to make large number
examinations which were without :,
l authority of the Executive Counc
t and for which fees and disbursement
3 were exacted grossly in excess of fl
compensation and reimbursement
1 the examinations made and expens
incurred. The records of the Exc
U tive Council did not disclose any
- thority for such examinations. VIII
4 Mr.. Merriam's attention was cal
to the matter, he said that the me
bers Of the Executive Council h
given him oral authority. and
recollection in this respect was vt
10 fed by letters from former membe
- AS Governor of the State then ma
"a an examination of his Office. for
t, purpose of ascertaining what &C
n panies had been examined and w
lie fees and disbursements had BE-
" charged. l at once discovered Il
e. the books of the Auditors Office
Y not show what examinations had bt
I'd made, or what had been charged