Burlington weekly free press. [volume] (Burlington, Vt.) 1866-1928, 1905-08-10
INSURANCE PROBES
New York Legislative Committee
Not to Investigate Any ons
Company Alone.

TO search OOt incompetent M000Ges
ment, but IL TO study the whole
0uestion From Different
Points Of View.
New York State, through the recently
appointed legislative committee, Is to in
vestigatc Immediately not any one life
insurance corporation or make any in.
QUESTION to search out incompetent or
illegal management, but Ii to study the
whole question from its economic, its So
cial and its trusteeship character, of the
business of insuring life in return for a
yearly premium, says the New York cor
respondent of the Philadelphia Press.
Many of the features Of life insurance of
to-day are absolutely of modern develop
ment. When Theodore Roosevelt was
governor of New York the Legislature,
feeling around vaguely, exploring tenta-
lively, undertook to perfect State legisla-
ton respecting life insurance corpora
tions. That body made a sad mess of 1t
and would have caused Generalization
but for the action Of Roosevelt himself.
The Legislature believed that 1t had a
curc-all In a proposed bill written by some
superficial, inexperienced person in which
was set forth a prohibition operative
against all life insurance corporations.
forbidding them to accept any new BUSH
ness after a certain maximum amount
had been obtained. 1t was like saying
that II any life insurance corporation had
written policies aggregating q hundred
millions or a thousand millions, then 1t
must write no more new policies until
through death or through the lapsing of
old policies the aggregate amount of In
surance had fallen below this maximum
figure.
CALLED IN EXPERTS.
Governor Roosevelt called into consuita.
ton some of the really great experts, the
highest authorities in the philosophy and
practice Of life insurance. The governor
knew intuitively that something Of error
was in that proposed measure. but being
inexperienced in these matters he could
not Immediately put his finger upon that
error. Among those he summoned was
George w. Perkins, a master of the
science upon its practical and upon it's
theoretical side and master, too, of the
history of the stupendous development of
life insurance in the United States.
Mr.. Perkins instantly pointed out to the
governor. not merely the clumsy feature
of this proposed statute, but the harm
that was in it. 1t would have at once
checked, if not destroyed, the organiza-
ton of every important life insurance
company chartered by the State Of New
York. and organization is the vital feature
Of life insurance.
Governor Roosevelt did not fail to sce
the force of Mr.. Perkins's reasoning and
he Informed the leaders of the I.egisla
ture that II that bill were passed he
would veto it. not merely because it
would be ineffective. but because it would
completely demoralize life insurance BUSH
ness.
OUR OBSOLETE LAWS.
At that time Mr.. Perkins said to Gov
ernor Roosevelt that the laws of New
York State respecting the regulation and
operation of life insurance corporations
were obsolete. term recently used by
Governor Higgins when explaining to the
public the reasons that induced him tn
recommend the Legislature to appoint a
special committee to make inquiry into
the whole subject.
One Of the first steps that this inyesti-
eating committee should take ia the an.
pointment Of a subcommittee or tho
designation Of some competent person or
persons acting as sort of commission
who should he required to study the in
surance laws Of Great Britain and of
Europe with intent to discover whether
~. ~
tions. there are regulations which might
DE ADOPTED TO the advantage of the insur-
ance corporations chartered by New York
State.
Germany. especially, has made a most
thorough. exhaustive study of life in
surahce IN its relation to the State, to
the community and to the individual
That had been made plain to some OF
the leading insurance managers of New
York within the past eight or ten years
A few years ago Germany sent a COM
mittee or commission OF highly qualified
experts to make examination, not merely
into the condition, but into the methods
and personnel Of one OF the three great
life insurance corporations OF the world
namely. the New York Life. That ex-
animation was a condition pre-requsite to
the continuation of the permission grant,
ed by Germany that this corporation do
business in the German empire.
1t is safe to say that no committee OF
Congress. no legislative committee, no
regularly authorized officer Of the federal
or State government ever made so minute
an examination as this German COM
mission did into the affairs of that cor
poration. The manner in which it did
its work was of itself sufficient proof of
the thorough understanding which in
Germany prevails in government circles
as to the relation of the life insura nee
business to the State and to the COM
munity. AS this commission made no re-
port that compelled this great American
corporation to withdraw from Germany.
1t has been reasonably assumed that 1t
has conducted its business in accordance
with the economic standard esta blished
by the German government.
AN INTERNATIONAL BUSINESS,
While New York State has chartered
many life insurance corporations and
has given charters to three. whose aggre.
gate assets are $l,25O. 100000. representing
considerably In excess of three thousand
millions OF insurance policies, the State
il responsible to the world for the sound
ness, economy and honesty of the meth
dds adopted by these corporations IN
managing their business. They. next to