Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1904-08-29
COMPLIMENT !:
IOWA : METHODS
Iowa and Not Minnesota Makes
Insurance Business Reason
ably Safe For Investors
COVERS VALUE OF CERTIFICATES
Matter Comes Up in Report Made on
Affairs of the Northwestern Nation
al Life Insurance company-Deposit
in State Capital of About s1,7oo,ooo
Showing of Recent Examinations.
Special to rimes-Republlcan.

Special to mes-Republlcan.
Des Moines, Aug. 29.--It was high
compliment paid by the insurance de-
partment of Minnesota to the insurance
department. of Iowa in the report made
on the affairs of the Northwestern Ma
tional Life Insurance COMPANY. and
u is all the more significant because in
this compliment is virtually a reflection
on the insurance laws or system of
Minnesota. Commissioner Dearth oe
minnesota, after pointing out that the
company was virtually buncoed in its
purchase of the Northwestern Life
and Savings Company. of this city in
that it paid a price far above the worth
or that which was got. declares that
the persons who took out certificates in
THIS investment company when it was
located in Des Moines are safe. be-
cause of the fact that the state OF Iowa
holds securities to cover the reserve
value of all these certificates. That
this is true of Iowa and not OF any
other state places Iowa virtually in the
position Of guaranteeing the safety of
a company now located in another state
and guaranteeing It for all the business
done In every state or in other words
that Iowa and not Minnesota has made
this business reasonably safe for the
investors in certain kinds of certificates
issued And the reason for this lies in
the fact that when the Life and Trust
Company was sold out and Iowa pro-
meters got 100000 for that which cost
them virtually nothing but little
scherning, the present state auditor of
Iowa, b. f. Carroll insisted on a con-
tract with the Minnesota company,
which will continue indefinitely the op-
Grafton of the business under the re-
strictions and safeguards OF Iowa laws.
The Minnesota company would prob
ably have carted off the million or more
of notes and mortgages locked up in the
state auditors office, but for this forc-
ed contract under which the securities
remain here. 1t might as we'll be adj
mitted now that it was very doubt
ful II the Iowa officials had the right
to insist on such contract-but they
did 1t. More recent legislation suggest
ed by Auditor Carroll and Gov. Cum
Minis had made it impossible for such a
dilemma to come again. Previously un-
der another state auditor a similar
transaction in the sale of an Iowa in
surance company had resulted in with
drawal of all securities and thus men
who had invested under the guarantees
of Iowa law found themselves unpro-
tected. Auditor Carroll was determin-
ed that nothing OF this sort should hap
pen again. And thanks to his vigilance,
rather than to the laws of Iowa or
those of Minnesota. or the care of 9TH
er insurance departments, the certtf-
cate holders of the company are as
sured at least return Of their invest
ments at the end of their certificate
terms OF course. the state does not
guarantee any profits. more especially
the enormous profits promised. but does
hold securities to cover value of certi-
ficates.
It was under this contract that the
state retained the securities previously
deposited, and has since required the
company to add to the deposits as the
certificate holders have paid in larger
sums. After the examination was be-
gun of the Minnesota company by Ac-
tuary John NJ Emery, for the Iowa de-
partment, working In conjunction with
Actuary S. H. Wolfe for the Minnesota
department it was soon found that
the amounts paid in on the various
certificates was much larger than had |
been reported, and the company was
required to deposit with the Iowa state
auditor between 100000 and 100000
more to cover these greater payments
than reported. Now the company has
on deposit in the state capitol a total |
of about 81 700, 900, which indicates the |
amount of money invested in this way |
in the so called gold bond certificates"
by the people of Iowa.
That part of the report Of Commits |
sioner Dearth of Minnesota, bearing on
the transactions under the Iowa con- |
tract and which shows the value to
some 90. 600 certificate holders of having
a competent and honest state auditor
in charge of affairs follows:
"In the matter of management ex-
penses there certainly appears to be
occasion for radical retrenchment 1t
is clearly evident as result OF this ex-
animation that the expense involved,
affecting the reinsurance of business
from other companies has been ex-
cessive as compared with the net vol
ume of desirable business secured and
retained for any considerable number
of wears in force thru the payment OF
adequate premium rates
"The most notable or important
business transacted Is that
OF the Northwestern Life and Saving,
Of Des Moines Iowa, effected during
the year 1903. While a large volume
Of desirable invested securities were
acquired. still in view Of the fact that
every dollar Of same absolutely belongs
to and must be paid finally to the re-
spective persistent policy holders OF the
reinsured company, 1t would appear