The Cairo bulletin., 1905-12-06
INSURANCE

/ ready authorized by existing law.
INSURANCE
The great insurance companies afford
striking examples of corporations,
whose business has extended SO far
| beyond the jurisdiction Of tie states
which created them as to preclude
strict enforcement of supervision and
regulation by the parent states In my
last annual message I recommended
that the congress carefully consider
whether the power of the bureau of
corporations cannot constitutionally be
extended to cover interstate tranSac-
tons in Insurance" Recent events
have emphasized tile Importance of IN
early and exhaustive consideration of
this question, to see whether 1t Is not
possible TO furnish better safeguards
than the several states have been able
to furnish against corruption OF the
fragrant kind which has been exposed.
II has been only too clearly shown
that certain OF the men Mt the head Of
these large corporations take but small
note Of tho ethical distinction between
honesty and dishonesty They draw
the line only this side Of what may be
called law honesty, the kind Of honesty
necessary in order to avoid falling into
the clutches OF the law OF course the
only complete remedy for this condi-
ton must be found in an aroused pub
lie conscience, a higher sense of ethical
conduct in the community at large and
especially among business men and In
the great profession OF the law. and in
the growth of n spirit which condemns
all dishonesty. whether in rich man or
in poor man, whether ii takes the shape
Of bribery or Of blackmail. But much
can be done by legislation which Is not
only drastic, but practical There is
need of far stricter and more uni
form regulation of the vast insurance
interests of this country The United
States should in this respect follow the
policy of other nations by providing
adequate national supervision Of com
mercia interests which are clearly ma
tional in character. My predecessors
have repeatedly recognized that the
foreign business Of these companies is
an important part OF our foreign com
mercaI relations During he admins
trallons of Presidents Cleveland, Har-
rison and Mckinley the state depart
ment exercised its influence through
diplomatic channels to I"event unjust
by foreign countries
against American insurance compa-
MES. These negotiations illustrated the
of the congress recognizing
the national character Of insurance, for
in the absence Of federal legislation the
state department could only give eX-
preston TO the wishes Of the authori-
ties Of the several states. whose policy
was ineffective through want of uni
formity.
State Supervision Inadequate.
! repeat my previous recommenda- /
ton that the congress should also con
slider whether the federal government
has a:y power or owes any duty with
respect 10 domestic transactions in in
surance Of an interstate character.
That state supervision has proved In
adequate is generally conceded. The
burden upon insurance companies. and /
therefore their policy holders, Of con
licting regulations Of many states IS 4
InqucstioneI. while but little effective /
heck is imposed upon any able and un ]
;crupulous man who desires to exploit /
he company in his own interest at the I
expense Of the policy holders and OF /
he public. The inability Of n state % I
'egulate effectively insurance corpora I
ions created under the laws Of other 4
states and transacting the larger part I
II their business elsewhere Is also .
lear. As remedy for this evil Of con.
iicting. ineffective and vc; burdensome I
regulations there has been FOR many
ears a widespread demand for federal .
The congress has already
eccgulzed that Interstate insurance \
nay be a proper subject for federal I
cCislation. for en- creating tho bureau
# corporations 70 authorized IL to pub
ish aud supply useful information con-
,ernlng interstate corporations. "in-
iudinS corporations engaged in insur-
nee" II is obvious that If the compl-
alton Of statistics be the limit of the
ederal power it is wholly Ineffective
D regulate this form Of commercial in
ercourse between the states. aud as
be insurance business has Outgrown
b me- Euitude thc possibility Of AIDE
uate state supervision the congress
hould carefully consider whether fur
her legislation can be had What Is
aid above applies with equal force 70
and benevolent organizations T
vhicl contract for life insurance.
RLVISi0N OF REVENUES +