The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1905-09-26
THE STAUNTON COMPANIES
COMPARISON DOES GREAT
INJUSTICE.

by men in whom the business worm
has confidence: 2. They are organized
upon the sound principles found by
experience to be safe and rellaD!c:
3. They have sufficient capital AMI
reserve and other assets to guaran-
tee the payment of their liabilities.
AS to life insurance companies
some people have been afraid they
would share the fate of the several
companies organized at Staunton, Va,
which failed after short career.
They forget that the Staunton COM
panies were wholly or in part assess
ment companies. There has not been
an insurance company in Staunton
that did not do business on some
form of assessment insurance The
history of nearly all assessment com
panies is that when the members be-
gin to grow old, it is difficult to get
younger men to join, assessments
have to be raised on all the old MEM
bers and they sooner CIR later, If
MES were sure to fail. The Royal Ar
canum found it necessary to increase
the assessments on old members.
That is almost the invariable rule,
and because of it they all have in
them the seeds of death.
But it would be as fair to COM
pare the strongest banks at Charlotte
and at Raleigh to the wildcat banks
of Mississippi in the fortles as TO
compare either of the North Carroll
ma Companies having deposits with
the state Insurance Commissioners 10
the stanton companies. Such refer
ences are calculated to do great IN
Jury to the companies that are organ
lied upon the same sound principles
as the Union Central, the Penn Mutt
al the Aetna and other companies
that have grown from small begin
nings to strong and great companies
If any North Carolina company -
oreanized upon an assessment plan,
or with capital too smafi or not pald
in. or lacks any essential prllicipie
of safety, it is fair to compare ti'@'
company with the Staunton colhpa-
MES. But it does grievous wrong "
.o,;d oomnanies to make such gem
eral comparison without naming th3
companies that are like the otauii'oi'
companies.
There is already abroad notloh
among some people who nave given
,;ttlo thought to the insurance ques-
ton that the bigger the company Tue
better the protection. Ihat holioii
has recently been exploded. Inc
strongest company is the company that
is honestly and properly manaseu'
has enough business not to make au-
ministration cost too much, ana 'ii"'
has sufficient reserve to meet It's ia
,i,;ties as they come due. That ON
Many NAV be a mutual company with
No capital. il may be stock com
Danv with only 100000 capital IKE
the Aetna, or larger capltal me
some of the other companies. me
all important thing is that it be man
aeed upon the sound principles APP
proyed by experience. Insurance Is
almost an exact SSAciiSN'
can tell almost to a man now many
men in a thousand insured VIII dle
In a given year, and wise insurance
men fix the rate to provide FOR the
naynlent of the policy when the IN
sured dies. They charge more Tor
insurance than II costs in ORDER 10
have more than is necessary. some
companies use that excess to pie up
A dangerous surplus, some spend d
norton of it in dinners to French am
bassadors, balls and wild cat schemes
but the best of them returnN 1t 10
policy-holders at stated ana Irequeh.
neriods as dividends. There IS not
one of the North Carolina companies
having capital and deposit with the
Insurance Commissioner. that is not
as safe as the Union Central. the Penn
Mutual, the Aetna or any other solla
old line company. They have as
much CAPITAL as the Aetna or the
Eol,itable. and though they may never
grow so great they will be just as
safe as the great companies Tor they
are conducted upon the principles tnaI
are sure to give sufficient assets to
meet all liabilities. The Commerclal
and Farmers Bank in Raleigh, has
capital of only 100000 and $7O0,O0O
deposits. but il is just as strong an III 7
stitution and is as we'll fixed to meet
its liabilities as the Morgan or Rookie
TELLER banks with their millions or
capital and millions of deposits. In
fact it Is safer because it is managed
directly by individuals known to the
community, while there is much or
the machine in the management OF
those giant institutions. That is true
of the other good banks in the State.
1t is equally true of those North Car
olina life insurance companies organ
lied by some of the best business men
in the State and conducted upon
sound business principles that have
brought success TO every great insur-
ance company in America.
OF course there are always some
people who do not believe in the ca
pacity of folks they know to do any