The Minneapolis journal. [volume] (Minneapolis, Minn.) 1888-1939, 1904-04-09
Fraternal Insurance Laws.

Insurance Commissioner Dearth /
fraternal insurance societies in Min |
nesota. This is almost one in ten
of the entire population, and one in
three Of the adult male population
must be carrying fraternal insurance.
Fully one-third Of the families in the |
state are furnished protection by
these societies. Last year they paid
9S1, a large part of which went to
keep poor widows and orphans from
actual want. They are doing great
public work, and the public is inter-
ested in their continued welfare.
Leading men in the fraternal So
cieties are agitating for uniform laws
which will insure their stability and
permanence, and it is to be hoped that
their efforts will succeed. Experience
has shown that the old-fashioned
pass the hat plan" of insurance is
not a success. A company or society
that assesses only the Immediate
mortality of it's members will at
tract many by cheap insurance, but
as the members grow older the cost
will mount rapidly, and this increased
cost will brighten new members away,
burden.
The students of fraternal insurance
have learned from these lessons Of the
past, and have been working to get
| their associations on a reserve basis.
A table has been prepared by the Ma
tional Fraternal Congress, which is
based on the experience of the So
cieties, and provides for the average
death rate, so that an association can
start in at a definite rate Of assess
ment and maintain it for all time.
There have been hard contests in all
the societies, for the average member
who is not informed Is slow to under
stand the necessity of a higher rate,
and cltngs to the idea of keeping the
reserve in your pocket"
The logic of the situation has final
ly carried the day in the older So
cieties, which are adopting rates that
will guarantee reserves and the
permanency Of their organizations
These rates are not as high as those
Of the old line life insurance com
panies, for the reason that the ex.
pense of management is less
They are quite an advance, however
over the former rates.
II Now these companies are needing
laws to protect them in their stand
Many small organizations are still
running on the old plan, at a much
smaller present cost to their members
Their cheapness attracts members
and takes them away from the olde
societies with their scientific rates
Many such societies are ephemeral
organized by some Individual for hi
benefit and lasting until that benefi
ceases to accrue to him. The Mime
sofa law is little better than a blank
It Is only necessary for a society t
. secure fifty applications, and pay Al
l ing fees of $12, to become an author
lied fraternal insurance association
I There Is no requirement as to rate:
y and the company may run as long a
n have themselves.
L The officers Of the older fraterns
e societies, or rather the larger one.
e for none of them are very old, ar
now in favor of good state law o
e the subject, one that will require a
e assessment rate based on the Nations
: Fraternal Congress tables. A bill {
e that nature will probably be presente
n to the next legislature. It cannot b
o passed without the support Of the fra
e ternal societies, which are stron
= enough in their influence to defeat an
: measure they disapprove of. It doe
n seem that there should be more eff
J. cient state regulation of fraternal ii
a surance, for the benefit of the me
d who pay the premiums.
II The Journal hopes that tn
10 agitation in fraternal circles will bes
+ fruit in a law which will be fair an
a satisfactory to the societies, an
potent for their future welfare.