The Minneapolis journal. [volume] (Minneapolis, Minn.) 1888-1939, 1905-03-11
WHAT OTHER PEOPLE THINK
some Insurance Problems.

Some Insurance Problems.
To the Editor Of The Journal.
have read with great deal Of interest
your editorial in ThelJyo urnAl OIL
Wednesday evening, Feb. o., under head
ing Of wisconsin Equitable Case, - also
articles of different dates upon the fees
collected and pocketed by. an ex-insurance
commissioner Of Minnesota, amounting to
over 100000, which was SO much taken
from the policy holders; and also COM
| ments as to laws relative to the governing
of insurance companies doing business in
| the state. 49, b, 80.
| I notice you state that nearly all the
! trading in the peoples insurance money
! In Wall. street has been done thru the.
manipulation of the sundistrtb surplus
and that while the policyholde r Is walt
ing for his tontine period to arrive, the,
officers of the companies have sport with
his money. - s
| If this be true, why is It not also true
that they have sport with the reserve as
well as with the surplus? take issue
with you in regard to Mr.. Beardsley's
showing in the Era, or take Issue with
Mr.. Beardsley. He undertakes to show,
| or convey the idea to the reader that the
! dividends of the three large New York
companies have decreased /. enormously
| since 1878, when all Of them were issuing
annual dividend policies only It is true.
1
have decreased since 1873, so have the
earnings Of all insurance companies de-
! creased since then; owing to "a nucn low
err rate of interest realized now as COM
pared with that period and a larger ex-
pense ratio to procure new business now;
and also owing to the" fact that policies
now have liberal cash and loan values and
automatic paid-up or extended insurance
options, and consequently the companies
do not make as much from lapses now as
| in former years. Attention Is not drawn
| to the fact that interest rates realized
now by the investor outside Of insurance
are not much more than half what could
be realized twenty to. twenty-five years
ago. Why not give the insurance companies
the benefit of decrease as well as other
forms Of investments?
About twenty five years ago two Of the
companies referred to began issuing ton
| tine or deferred dividend policies and the
other company referred to began Issuing
deferred dividend policies in 1885. and
most of the business issued since that
time has been on the tWenty-year plan,
consequently the dividends paid have been
small in comparison to the premiums re-
ceived; but the surplus has been greatly
increased and; will be paid in larger
amounts annually from now on, to policy
holders maturing their policies. have
seen dividend results at the end Of TWEEN
ty years which were over 80 per cent Of
the premiums paid I have two twenty
payment life policies on which I do not
draw any dividends until policies have
been In force twenty. years, and prefer
to have the surplus increase so that my
! policies will draw their proportion Of the
earnings rather than have the earnings
paid out annually on policies that it does
not belong to; simply to make a larger
ratio for the company as to premiums re-
fceived. (. !. e., IT,. ..-
Vo11 io tho If do
plorable failure Of these large concerns
to make a reasonable showing. 1 think
if you or Mr.. Beardsley or any other man
who will take time and pains to- get all
the facts and present them in a fair man
ner. showing all payments to policy-hold-
ers, plus all r. accommodations for policy
holders, you will confer g. benefit upon the
public generally and especially upon poll
cy-holders in all companies, who become
} dissatisfied because of such criticism
where only a part Of the facts are re-
vealed: =, 49,. - Is
Il believe another great injustice is
, done by the state. to policy-holders in
both life and fire insurance companies, by
: Imposing a 2 per cent annual tax on all
premiums paid in. the state. This in
I creases the cost Of insurance to the indi-
vidual and by so doing discourages many
, from taking on insurance protection,
(which they and their families need 49,
| 1 nOLlceu IN laSl nlgnt GU II a mat
, a bill was presented yesterday ! in the
d. house to increase the annual tax on fire
, insurance premiums to per cent per an
n num- This seems to me very unjust, as
the people who carry fire insurance will
, have to pay this increase. > /
+ The old saying that "the farmer pays
! the freight" Is true, and it Is true that
the policy holders pay the taxes. It is
;, also a special tax upon thrift, as the
= man who carries Insurance protection
: lessons the probability of the state hav-
o Fling to provide for him in his old days, and
!; for his family in event Of his decease be-
Z !, fore he has provided sufficiently for
> them. w. e. Robinson.
+ Minneapolis, Mimi, March 3, 1906,