The Minneapolis journal. [volume] (Minneapolis, Minn.) 1888-1939, 1905-12-05
SEEKS TO CORRECT
INSURANCE EVILS
President Would Have Congress
Take Up Matter Of Federal
Supervision.

49, -g ~ : & 4 +
The great insurance companies afford
striking examples Of corporations whose
business has extended so far beyond
the jurisdiction of the states which
created them as to preclude strict en-
forcement of supervision and regulation
by the parent states. In my last an
nual message [ recommended that the
congress carefully consider whether the
power OF the bureau of corporations
cannot constitutionally be extended to
cover interstate transactions in insur-
ance. &
Recent events have emphasized the
Importance Of an early and exhaus-
tive consideration of this question, to
see whether it is not possible to fur
nish better safeguards than the several
states have been able to furnish against
has been. exposed. It has been only
too clearly shown that certain of the
men at the head Of these large corpo-
ratlons take but small note Of the eth
zeal distinction between honesty and
dishonesty; they draw the line only
thus side IT what may be called law
honesty, the kind Of honesty necessary
IN order TO- avoid falling into the
complete remedy for this condition
must be found in an aroused public
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 spirit which condemns
all dishonesty, whether in rich man or
IN poor man; whether it takes the shape
OF bribery or of blackmail. But much
only drastic but practical. There is
need Of far stricter and more uniform
regulation Of the vast insurance inter
ests Of this country. The United States
should IN this respect follow the policy
OF other nations. by providing adequate
national supervision of commercial in
terests which are clearly national in
character. My predecessors have re-
peatedly recognized that foreign bust
ness OF these companies is an important
tons. During the administrations Of
Presidents Cleveland, Harrison and Nc
hln!ey the state department exercised
its influence, thru diplomatic channels.
to prevent unjust discrimination by for
(e1gn countries against American insur-
ance companies. These negotiations
| illustrated the propriety of the congress
recognizing the national character Of
insurance, tor in the absence Of federal
only give expression to the wishes Of
the authorities of the several states.
whose policy was Ineffective thru want
of uniformity.
I repeat my previous recommendation
that the congress should also consider
whether the federal government has any
power or owes any duty with respect to
oomestlc transactions in insurance Of
an Interstate character That state su-
pervision has proved Inadequate ia pen.
orally conceded. The burden upon in
surance companies, and therefore their
pollcyholders, of conflicting regulations
OF many states, is unquestioned. while
but little effective check is imposed
upon any able and inscriptions man
who desires to exploit the company in
| his own interest at the expense Of the
Pol1cyholders and OF the public. The
1nabll1ty OF a state to regulate effective
ly insurance corporations created nnder
the laws Of other states and transacting
the larger part of their business else.
where is also clear. AS a remedy for
this evil Of conflicting, ineffective. and
yet bu1rdensome regulations there has
peen Tor many years widespread de-
mand for federal supervision. The con
gress has already recognized that inter
for federal legislation, for in creating
the bureau Of corporations it authorized
It to publish and supply useful informa-
ton concerning interstate corporations.
snr n91ndi 9,g corporations PC engaged in IL
compilation Of statistics be the limit Of
the federal power, it is wholly ineffect-
i've TO regulate this form Of commercial
intercourse between the states, and as
the insurance business has outgrown in
magnitude the possibility Of adequate
| state supervision, the congress should
| carefully consider whether further leg
islation can be had. What is said above
! applies with equal force to fraternal
and benevolent organizations which con-
tract for life insurance. -