Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1905-03-13
Attorney General Mullan De-
livers Adverse Opinion to Is
suance of Ante-dated Policy
OPEN TO SERIOUS OBJECTION
The Opinion Holds That the Character
of Such Contract Will Almost Ger
tainIy be Misrepresented by 'nsur-
ance solicitors-scheme of State
Life Insurance Company of Indiana.
To Times Republican.


Company of Indiana, i'll issuing scN
en- year ante dated $4,000 policy ior
81 600 was IAN attractive and allurihs
dope adopted by an insurance company
for the purpose of inducing persons "
+alea insurance under misrepresenta-
t;on as to the value of what they OBJ
tain"
The opnion. in effect, is not against
the theory of issuing ante-dated poii-
cies, but it is directed against thelr is-
| suance at an excessive cost TO the M
s,,red an excess of $24d.30 in the case
Of the $4,000 policy dated back seven
wears used by the attorney generai as
aM illustration.
The Iowa law prohibits the issuance
| OF a policy by an insurance company
from making or permitting any ois-
tinction or discrimination between per-
sons insured in the same class ana Oh
equal expectancy of life in the amount
OF payment Of premiums or rates
| charged or in dividends or other bene-
fits or in any other of the terms or con-
| ditions of the contract 1t makes.
| The question is as to whether a per-
son who takes policy on a twenty
year payment plan, dated back seven
years, is actually placed in the class OF
| those who took insurance in the COM
pany seven years previously, charge
of $1,000 being made against the new
member. Does policy holder who
goes in in 1903 under these terms stand
on an equal footing with those who
went in in 1896?
Opinion Of Attorney.
The attorney general says he does
not. In this respect his opinion fol-
lows:
1.-THE plan on which the policy under
consideration is proposed to be issued
is that it shall be ante dated seven
years, that lien of $1,000 upon a $780,
900 policy shall be charged against the
policy and that the insured shall pay
interest upon such lien. it being claim
policy placed the insured upon an
equality with policies issued seven
years prior thereto.
"The charging of the lien of $1,000
against the policy in the manner pro-
posed by the company is a discrimi-
nation against the person who takes
the policy in the year 1903, as the lien
Iso charged is $244.30 in excess of the
amount which the entrant should be
/. required to pay to place him upon an
equality with the class who took in
surance seven years prior thereto, at
the age of 20 years. By this method
the company receives $244.3O in excess
of the sum which it is entitled to re-
ceive for the insurance written, and
it is enabled to take out Of the cash
premium paid and the increase Of the
reserve by interest that sum and apply
it to whatever purpose 1T may desire.
1.-THE person to whom the policy is
issued receives no advantage whatever
in consenting to have it ante-dated in
the manner proposed, and the issu-
ance of such a policy is open to the
most serious objection that it is all
most certain that the character Of the
contract will be misrepresented by ir-
surance solicitors, and that it will be
issued under a misunderstanding or
the part of the person who accepts it,
as to it's character and value.
An Attractive Dodge.
at appears to be an attractive and
alluring dodge adopted by an insur-
ance company for the purpose of I'm
ducing persons to take insurance I'M
der misrepresentation as to the value
of what they obtain. 1t Is possible
that the officers and managers of the
company adopted this manner of OBJ
tanning insurance in good faith and
. without any intention of misrepresent-
ing the value of the policy. which they
issue under the plan proposed, but in
placing this policy upon the market
by means of insurance solicitors, who
are employed by the company for the
purpose of inducing persons to accept
!, it. under the plan adopted n1isrepre-
sensations on the part of such solicit
tors, and misunderstanding on the
part of the persons who are induced
to accept the policy, are certain to
follow it's use. While the insurance
company may not be chargeable with
wilful fraud or misrepresentation !
am unable to see how it is possible for
it's officers and managers to adopt a
policy of this character and employ
solicitors to sell it to persons wishing
insurance under the i.lan adopted
without knowing that the persons who
are induced to accept the policy will
take it under misrepresentation as
to the character and value Of the con-
tract which they obtain from the COM
pany.
1.-The issuance of the policy in the
manner proposed, and the charging OF
lien against it in the sum of $l,600
or the requiring of the payment of that
sum in cash by the person who accepts
|, the policy, is clearly vi olation of the
section of the statute referred to, as
it is discrimination between persons
insured of the same class in the a
mount or payment of preminm or rates
charged for life policies.
"1n my opinion, the policy submitted,
and the method of issuing the same
adopted by the State Life n,urance
Company of Indiana, should be prohib
tied by the insurance department OF
the auditors office and the insurance
company should be required to take
up and cancel all of the policies OF the
character named which have been is
! sued upon the plan outlined herein,
and to return the persons to whom
such policies were issued, the full a
mount of the premium paid by them
thereon"
NO HELP FROM THE FATHER.