The Morris County chronicle. [volume] (Morristown, N.J.) 1877-1915, 1905-07-25
STATE AFTER EQUITABLE
New York to Investigate All Life In.
surance Companies.
LEGISLATURE NAMES COMMITTEE

Governor Higgins Sends u Special Mes
sage and Senate and Assembly Join in
Resolution 10 Make an Inquiry Into
Lie Insurance. Methods and Draft New
Legislation.
Albany, N. Governor Higgins by
message to the Legislature caused
the appointment of joint committee
Of both houses which win at once be-
gin thorough investigation into the
Equitable Life Assurance scandal. as
well as into the business methods Of
the other life insurance companies,
misuse and mismanagement ef the
funds Of the policy holders.
Senators Armstrong. FULLY aud Rior
dan have been appointed to the joint
committee from the upper house.
The sum of $4,000 was appropriated
for the use Of the committee in con
Quoting its Investigations.
The joint committee is Instructed to
prepare and recommend to the next
Legislature. which meets i'll January,
such proposed legislation as may be
adequate and proper to restore public
confidence and to compel life insur-
ance companies to conduct a safe hon
est and open business for the benefit
OF their policy holders
Those who have been contending that
savings banks safeguards be thrown
around investments by insurance COM
panies Of money belonging to the pol
Icy holders are pleased exceedingly by
that portion Of the Governors message
which refers to remedial legislation
needed He says investments must be
restricted salaries must be kept within
the limit Of the commercial value of
the services performed policy holders
must be vested with greater power in.
the government or the companies and
trustees must be held TO strict account
ability.
The State cannot permit the sub
jects of its supervision to exist as IL
censed prodigais of other peoples
money without becoming an accom-
plice to the offense" said the Governor.
I'VE cannot Judge all life insurance
companies by the sins of one. We
should not destroy the edifce to rid our
selves of the yermin that infest ii, nor
should we kill the patient to stop the
progress Of the disease. A revision Of
our insurance law is necessary, but it
should be made with calmness, DELHI
GRAFTON and intelligence and after care
full investigation"
ii is admitted the task put upon the
special committee is one of great mag
nitude Doing business in New York
State at this time are forty-two old
line or level premium life insurance
companies. Fifteen work under New
York charters. 1t is intimated the
committee scarcely will attempt to in
vestigate more than these New York
companies, which include the Eguit-
able, the Mutual Life and the New
York Life. Six of these fifteen home
companies within a few months have
been criticised for their methods of
doing business.
The gross assets of these fifteen COM
panies are s., 4SG, ass, 1864; liabilities,
81 ,256, S97, ITO %: surplus and special
funds. $128, 723 ,662 II; income in 1904,
S344, 465, 2S4.64 1t is asserted that even
to investigate thoroughly the fifteen
home companies, TO say nothing Of
those chartered outside the State,
would require more time than inter-
venes between now and the next SEES
sion of the Legislature Several
months would be required for single
big company like the Equitable.
The preamble of the Armstrong reso-
luton declared that the Equitable stu
alton had disclosed that the present in
surance laws We're inadequate to safe-
guard the policy holders. and that re-
vision Of the insurance laws should be
undertaken 1t was asserted that the
lnquisitorial powers OF the Superlnten-
dent of Insurance We're limited, and
that a legislative investigation was
needed to guide the Legislature in for
mulating new legislation. The resolu-
ton proper provided:
THAT joint committee he appoint
ed, which, after the adjournment Of
the extraordinary session, shall pro-
coed to examine into the affairs of life
insurance companies with reference to
investments. the relations of officers TO
sIch investments, the relations OF conf
panies to subsidiary corporations, the
government and control, the contractu-
al relations of said companies to their
policy holders. the cost Of life insur-
ance, the expenses of companies and
any other phases of the life insurance
business deemed by the committee 10
be proper, for the purpose Of drafting
and reporting to the next session OF the
Legislature revision of the laws
The only debate upon the resolution
was upon the amountiof the appropria-
ton. The original amonnt was SO
300. The Finance Committee increased
it to $4,000.