The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1905-04-06
CHEAPER INSURANCE A NECES-
SITY.

In former times it was rare thing
for man in ordinary circumstances
to insure his life. Then compare
lively few men worked on salaries.
The bulk of men lived on farms, put
their earnings in land and improve
ments, and did not feel the need OF
regularly putting away certain -stip-
ulated sums as savings in banks or
as protection to their families in life
insurance.
Conditions have changed in many
ways. A considerable portion of the
States population is employed by
railroads, factories and in great en-
men and skilled mechanics has in
creased; and this increase in salaried
men has caused more insurance pol
icies to be carried. Moreover farmers
have found it prudent to insure and
men of property have invested in in
surance policies, so that it is rather
rare thing to find man with mod
crate income who does not carry some
life insurance. AS to those who in
sure as an investment, the State
should not do anything. But as to
those who take out a policy of $1,000
or $4,000 for the protection of their
families, the State ought to add such
insurance as function of govern
ment. North Carolina is the State
that ought to make that new depar
~, 10
will be taken by every State in the
Union. One of the most successful
business men in Western North Caro-
lima, referring to the recent sugges-
ton in the News and Observer, in
private letter, said:
II am very much interested in your
idea of State insurance and 1 want you
To Keep hammering at it until we get
it at cost, to every man that wants it,
and all need it, 1t is the thing that
would put North Carolina ahead of
all the States and its citizens on a
safe and sound basis. Life insurance
is now only given by safe companies
at cxtortionate rates DIS shown by their
immense surplus and so-called divi-
dends. Educate the people and keep
it before them till all are familiar,
the machinery necessary to give all
her citizens the benefits of insurance
at living and not dead rates.
One of the most successful insur
ance men in Piedmont North Caro-
lima, referring in a private letter to
an editorial in Tuesdays News and
Observer on the danger of the i'm
mense surplus, which the great insur-
ance companies are piling up, said:
81 read your editorial today on the
subject An Immense Surplus Dam
GER with much interest, and beg to-
congratulate you on your treatment OF
tht subject. Your editorial some days
ago on State Insurance was, in my
opinion, along the wrong lines and Il
had thought of sending you a COM
munication on the subject. but your
editorial of today covers the points
that [ had thought to emphasize as
being most important viz: that the
cost of insurance was too high be-
cause of the failure to distribute the
unnecessary surplus. In the latter
portion of your article, you state that
if the policy holder finds it necessary
to withdraw, he gets so meaSly' a
sum that he must keep on paying, ETC.,
etc. In the Equitable and the other
QeIeGFGQ QlN1uSnQ companies, 1t 10
even worse than you picture, because
if the policy holder finds it necessary
to withdraw, before the distribution
period is completed, he gets nothing
for his share of the immense surplus
of course he gets a surrender value
for his policy in paid up insurance,
or its equivalent, but that comes from
the reserve and not from the sur
plus.
The recent exposures in New York,
involving in a sense the directors of
three great life insurance companies,
is proof positive that insurance rates
are too high. The policy holder in
the Equitable and other companies will
not lose anything by the extravagant
management, but there will be some
falling off in the hitherto
big increase in the con-
stantly piling up of an unneces-
sary surplus The exposures are sure
to result in more careful management.
Policy holders should demand a divis-
ion of all the surplus except the sums
necessary to mature the policies and
secure a reduction of the premium
iGte III the toChSApiC AASAA viii
not quit paying their premiums and
lose confidence in strong insurance
companies because of these disclos-
ures. Most insurance companies are
managed honestly, though there is in
most of them too much extravaganza
in expenditures. Likewise nearly all
are straining to pile up big surplus
beyond the needs to mature policies.