The Saint Paul globe., 1905-01-25
O'BRI[N REFUSES
FORTUNE IN FEES
Insurance Commissioners Turns
Money Over to the
State


as d. O'Brien has refused to accept the
fees of his Office which in the past have
amounted to over $4,000 a year. Mr..
O'Brien has Informed Gov johnson
that he does not believe the law which
allows the commissioner salary and
clerk hire contemplated his taking fees.
He is of the opinion that the fees be-
long to- the state and will turn them
into the state treasury Last year the
attorney general ruled that the fees in
question belonged to the insurance
commissioner, but the incumbent takes
issue with the decision. Since taking
the office Mr.. O'Brien has refused fees
to the amount of S1,50o.
The actuary fees received by Mime
sofa insurance commissioners in past
years have been the envy of other state
officials. The law provides that life in
surance companies shall submit to
valuation of their insurance in force
in the state at the option of the insur-
ance commissioner. The maximum
compensation provided by the law is
cent for each $1,000 in force, but
provision permits the insurance COM
missioner to accept the certificate of
the commissioners of other states in
lieu OF frequent examinations of the
same company. The examination is to
determine the liabilities of the compa-
nies by showing the valuation of their
outstanding policies. The Minnesota
law makes no provision for compensat-
ing actuaries, and they have been in the
past employed by the commissioner to
make examinations and are popularity
supposed to receive the fees for exam
ination.
Took the Difference
1t has been said that the commits
sioner fixed the compensation of the
actuaries, and that the difference be-
tween the amount provided for exam
ination by the statute and the sum
paid the actuary has been regarded as
the legitimate emolument of the state
insurance commissioners office.
Last spring an Eastern insurance
paper started war on Insurance Com
missioner Dearth, claiming that he was
receiving immense sums from the eX-
aminations, and the result was that
Gov. Van~Sant demanded an account
ing from his insurance commissioner
for the four years of his incumbency.
Mr.. Dearth submitted statement
showing that he had received in the
four years of his term $63,073.09 in
actuary fees. OF the big amount all
but $1,5S5.09 was obtained from the
cording to the statement rendered by
the commissioner to the governor. July
8 Attorney General Donahower, in re-
sponse to a request from the commits
Sioner, gave an opinion, in which he
held that the actuary fees properly be-
longed to the insurance commissioner
and did not have to be converted into
the state treasury. Both Gov. Van
SAINT and Gov. Johnson, in their an
nual messages, advised that the fees
of the state insurance commissioners
office be turned in to the state.
Commissioner O'Brien has inter
preted the provision of the law relat-
ing to his salary, that it shall be in
full for his services, to be an effective
bar to his participation in any fees in
connection with his Office. 1t is said
that there are no accounts in the in
surance commissioners Office to prove
or disprove the correctness of the
statement that the actuary fees for
four years amounted to $63,073.O9, and
there are rumors in legislative circles
that the actual amounts received were
much larger than the sum reported.
State to Receive Fees
A bill introduced by w. B. Anderson, of
Winona, in the house yesterday is aimed
to put all the fees of the insurance com
missioner's office into the state treasury.
L
mittee on Insurance., makes no reference
to the salary of the insurance commits
sioner. and unless it is increased by sub
seauent legislation it will remain at $1,000
a year The assistants salary is $1,S00.
On the request of Commissioner O'Brien,
Deputy D. C. Lightbourn has corresponded
with the insurance departments of fourteen
states and finds that eight of the states
pursue the policy of actuary fees being
paid to the actuary, or to his employer,
the insurance commissioner. The states
which have this plan in effect are: Illf-
nois Indiana, Maine, Michigan, Missouri,
New Hampshire, PENNSYLVANIA and Wis
consin. Five other states heard from,
Iowa, Massachusetts,, New York, Ohio and
Connecticut have laws conTerting actuary
fees into the state treasury, but make lib
era1 provisions for the employment of
competent insurance experts in this work.
The salary of the insurance commissioner
of New York is $500 and he has several
deputies who are paid $4,000 year.
States in which the fee system has been
abolished pay insurance commissioners
relatively higher salarids than in those
where the plan of actuaries' fees is fol-
lowed.
The committee on public expenditures
of the house was yesterday authorized to
employ an expert accountant to make
thorough examination of the state Of
fees, and it is said that the office OF the
insurance commissioner will receive an
overhaulng. 1t will be developed, it is
said, in this examination the amount of
fees that have been paid by insurance
companies for making the valuations, for
abstracts and for other services. 1t is
expected to secure a comprehensive re-
port of insurance department conditions
for submission to the legislature, and as
a result of the examination it is probable
Il
an increase in the salaries of the COM
missioner and his assistant and for addi-
tional help in the office Chairman p E.
Bowling, of the committee, is already
convinced that since Commissioner
O'Brien refuses to accept any fees he is
entitled to more salary than the 81, 500
now allowed his office.
81 shall introduce bill in the house
placing the salary of the insurance COM
missioner at So 5000,' Mr.. Bowling said
yesterday, "and his assistant at SO, 900.
shall also ask for an additional clerk who
shall be competent to act as actuary in
making valuations of companies. So far
as am able to learn. Mr.. O. Brien is MAX
ing a fine commissioner and the state
cannot expect to secure the services of
such man for only $1,000 year. It
would be improper for me to anticipate
the action of our committee on public
accounts. but I expect the committee will
give the insurance department a searching
investigation. The committee has the
right to call witnesses and administer
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