The San Juan islander. [volume] (Friday Harbor, Wash.) 1898-1914, 1905-07-29
Will INVESTIGATE
,cu YORK LEGISLATURE TO LOOK
vyTo life INSURANCE.
INlU liza
special joint Committee OF House
Senate with Ample Powers
u,,, Conduct Inqutry-neSSage
=, the Subject by Governor
HdninS.


legislative investigation Of life
% .once as carried on in the state
,L nv New York state corporations
OOsD those in other states doing business
in this state.
snecial Joint committee with ample
rors Of which the chairman will be
POno,or william Armstrong, of Roches-
y. Republican. The other senattv IL
'' 70 the committee will be William G.
~ y. W. of Corning, Republican, and
oan;al 7. Riordan, of New York city,
Damocrat. Senators Armstrong and
Tu1Iv are lawyers; Riordan is a real
.,.oto and insurance agent. The two
pannblicans were selected by Governor
niegins and Senator Raines, Republi-
oon leader in the senate. The assem-
blv members of the committee will be
named by Speaker Nixon within the
next day or two.
Chairman Armstrong said that while
tbe actual hearing by the committee
would probably not begin for some
time, the preliminary preparations
would be set in motion as soon as pos
sjble and the organization of the COM
mittee would take place as soon as the
assembly memb ers had been appointed,
Higgins Sends Message.
The institution of the committee fol-
lowed hard upon a message OF Gov,
Higgins to the legislature, which came
asa surprise. The message was re-
ceiyed in the senate after the conclu-
sion of the Hooker case, and was not
read until late in the afternoon session.
In the course of his message, Gov.
Higgins said:
1.-THE unfortunate scandals already
made public by the internal dissensions
of the Equitable Life Assurance Soci-
ETY. and by the comprehensive investi-
cations of its affairs by the superin.
tendent of insurance have not without
Justification aroused a feeling of in.
tense alarm in the breasts of thousands
of our citizens, who have invested
their money in policies Of life insur.
ance, and of the thousands of nen-resi-
dents who have been taught to respect
the New York companies as safe and
secure.
Though the business of life insur-
ance, as at present conducted, is sub
jected to state supervision and regula-
ton, it is evident that earnings which
should be credited to the policy hold
erS may be diverted to other purposes,
that expenses of operation may De ex-
travagsnt and wssteful; that unwise
Investments may be legally made, and
that trustees may deal indirectly with
the trust funds for their personal adj
vantage. That such. condition of
affairs can exist casts discredit upon
the state. 1t is apparent that our in
surance law is in some particulars in
adequate and that the management of
the funds of these great companies il
not sufficiently safeguarded.
Duty of State.
The state owes a duty to policy
holders and beneficiaries beyond that
Oh comparing assets or liabilities and
permitting the companies to justify
'nelr ezisttence by their exhibition Of
d satisfactory balance sheet and the
prompt payment of losses. Investments
must be restricted, salaries must be
united to the amounts bearing a clos
q relation to the commercial values Of
tns services rendered, trustees must be
ue,a to strict accountab ility and the
puilcy holders must be given q more
suectl7e share in the government Of
.ue companies. 1t may we'll be that
sue marsh and arbitrary remedy Of dis
sOlu1ion and receivership should be
s s not only a penalty for insolvency.
w. wv also a summary check upon a sol.
s ssn' company, when it becomes IRE
aeemaoly the plaything of lawless
Sou The state cannot permit the
l;a o!ects OF its supervision to exist as
mo prodigals of other people,
nH ouey without becoming an accom-.
pice to the offense,
oo. we cannot judge all life insurance
wiz upanies by the sins of one. A re-
sa 's.on OF our insurance law is neces-
IN, n.y. -. oot 1t should be made after care
study and Investigation"