The Providence news. (Providence [R.I.]) 1891-1906, 1905-07-20

Ssusss-e-es, :-:-.. f:s.%-.s:-.o:
In calling the attention OF the legisla-
lure to the insurance matter the governor
says
'"The unfortunate scandals recently
made public by the internal dissensions in
ahe Equitable Assurance society and by
the comprehensive investigation OF It's
Affairs by the superintendent OF insur-
ance have not. without Just cause,
aroused a feeling Of intense alarm I'm the
breasts OF the thousands OF our citizens
who have invested their money in policies
OF life Insurance and OF the thousands of
non-residents who have been taught 70
respect the New York companies, as SAFE
and secure.
while the business OF life insurance as
at present conducted Is subject 10 state
supervision and regulation, for the pur-
pose OF guaranteeing solvency and the
lfulfllment of contracts on the part OF the
companies, Il is evident that evils and
abuses may exist under our law that
earnings which should be credited 10 the
policy holders. may be diverted Ia other
purposes: that expenses OF operation may
ne extravagant and wasteful; that unwise
investments may be legally made, and
that trustees may deal indirectly with
the trust funds for their personal ad-
Vantage That such n condition of affairs
can exist reflects discredit upon the state.
Legislation Is no panacea for the Ills
OF the body polite that rise from dis
ordered moral sense The multiplied
ricn Of penal statutes does not diminish
the spirit OF lawlessness. but Is rather
a symptom OF it's growth. But IL is ap-
parent that our insurance law IS In some
particulars. obsolescent and inadequate
a. or IA ~
these great companies is not sufficiently
Bafeguarded
THE STATES DUTY.
"The state owes duty to policyholders
and bcn6aciaries beyond that OF compar-
ing assets with liabilities and permitting
she companies 10 Justify their existence
BY the exhibition Of satisfactory balance
sheet and the prompt payment Of losses.
Investments must be restricted. sal
aries must be limited 20 amounts bear
ing closer relation 10 the commercial
value OF tie services rendered, trustees
must be held 20 a stricter accountability
and the polcyholders must be given n
more effective share in the government
of the companies. II may well pe nat
tho harsh and ai'itrary remedy OF d'sso-
hutton and receivership should be made
not only penalty for insolvency but also
q summary check upon solvent company
when IL becomes irredeemably the play
thing OF lawless greed. The state cannot
permit the subjects OF its supervision to
exist as licensed prodlgals OF other peo-
Piles money without becoming an accom-
plice to the offence.
REVISION NECESSARY.
"Na cannot Judge all life insurance
companies by the sins OF one. We should
mot destroy the edihce 10 rid ourselves OF
lthe verrnin that infect st. nor should We
xii the patient 10 stop the progress OF
The disease A revision of our insurance
laws is necessary but IL should be MADE
with oalmness, deliberation and intelll-
gence and after careful study and invesu'
CATION"
Speaking OF superintendent's investlga'
tion OF the Equitable the governor says
that within the scope OF his authority
and iiftfit~ Of time the eglPeF4atens
dent has performed his duty with Impair
tia thoroughness. Although he has In
formed me that, by reason Of the statu'
tIry limitations upon his inquisitoral pow
ees and by reason OF the magnitude OF the
task imposed upon him, he would welcome
the aid OF legislative investigating com
rlittee have been of the opinion that he
with his stan Of experts and with the au-
thority vested In him 90 conduct investi-
cations at the expense OF the companies
examined was well qualified 10 collect Al
necessary evidence upon which 10 base
new legislation and that no other investi'
cation outside the courts of justice was
necessary or desirable. pending the in
vestigation now being conducted by him.
'It r.. however. of the highest import
ence that a revision Of the insurance law
should be enacted as promptly as is con-
sistent with a thorough knowledge OF the
subject II Is proper and necessary that
the legislature should determine for itself
how the information upon which 20 base
such a revision may best be obtained. II
in its judgment an Investigation conduct.
cd by it's own members and calculated a.
produce the most satisfactory results
such an investigation cannot too speedily
be begun.
A SPECIAL COMMITTEE.
In order that you may be free 90 con
rfder and act upon the subject at this ses
sion Therefore. pursuant 90 the constitu
ton 40 hereby recommend for your con
sideration the question of the appoint
ment Of n Joint committee ~ the senat,
and assembly with the usual powers o.
such committees 20 Investigate. after you
adjournment the operations of life insur
ance companies doing business In th'
state, for the purpose of preparing an,
recommending 10 the next regular ses
sion Of the legislature such proposed
legislation as may be adequate and prop
er 20 restore public confidence and q
compel life insurance companies 10 con
duct a safe. honest and proper businesi
for the beneht of their policy holders
RESOLUTION INTRODUCED
Senator Adam Strong Immediately In.
troduced a concurrent resolution provid-
Ing for the appointment of 2 special joint
committee consisting OF three senators