Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1905-07-21
Is Order from Gov. Hig.
gins Of New York.
See What Life Insurance Men
Are Doing In Our State.
An Equitable Loan Of $605,000 Cannot
Be Found on Books.

Albany, NJ Y, July 2O.-There will
be legislative investigation of the
| life insurance business as carried on
In this state. both by New York state
corporations and by those of other
states dong business within this state.
This investigation will be made by a
special joint committee with ample
powers, of which the chairman will be
Senator VIM. NJ. Armstrong Of Roches-
| ter. Republican. The other senators on
the committee will be Vim. j. Tulley of
Corning. Republican, and Daniel J.
Riordan of New York City, Democrat.
Senators Armstrong and Tully are
| lawyers; Senator Riordan is a real
| estate and insurance agent. The two
Republicans are said to have been Sc
lected by Gov. Higgins and Senator
Ra1nes, Republican leader in the Sem
ate. Senator Riordan by the Democratic
| senators.
| The hve Assembly members Of the
committee will be named by Speaker
Nixon within the next day or two.
| Chairman Armstrong said, tonight.
that while the actual hearings by the
committee would probably not begin
for some time the preliminary prepar-
atoms would be set in motion as soon
as possible, and the examination of
the committee will take place as soon
as the Assembly members had been
| appointed.
| The institution of the committee fol-
lowed hard upon a message of Gov.
Higgins to the Legislature, which came
| as complete SURPRISE. The message
was received In the Senate after the
| conclusion of the Hooker case, and was
| not read In the Assembly until late in
the afternoon session. Its effect may
be described as sensational. The Gov
errors message Is AS follows:
| State of New York Executive
| Chamber. Albany, July 20, 1905
ITO The Legislature:
Il was led to convene the Legisla-
ture in this extraordinary session by
reason of an extraordinary condition
existing at the close of the regular ses-
| sion. A justice of the supreme court
stood accused by the judiciary commit
tee OF the Assembly of unfitness to re-
main on the bench. No other provision
could be made for the speedy constitu-
tlonal determination of the question
whether cause existed for his removal
from Office. The right of the people to
an untainted judiciary and the right
OF the accused judge to be heard in
his defense alike imposed upon me the
imperative duty of summoning you to
dispose of the case.
After stating how and when an ex-
| traordinary session may be called the
letter says:
| ore subject in my judgment should
be submitted to you for your consid-
Grafton.
| Inc unfortunate scandals recently
mace public by the internal dissensions
III the Equitable Life Assurance Soci-
ely and by the comprehensive investi-
CATION OF its affairs by the superintend-
ent OF insurance have, not without lust
cause, aroused feeling of intense
alarm in the breasts of thousands of
our citizens who have invested their
money N policies of life insurance. and
OF the thousands of non-residents who
have been taught to respect the New
York companies as safe and secure
| While the business of life insurance. as
at present conducted. is subject to
state supervision and regulation for the
purpose of guaranteeing sovency and
1
OF the companies, it is evident that
evils and abuses may exist under our
law, that earnings which should be
credited to the policyholders may be
diverted to other purposes, that ex-
penses of operation may be extrava-
CANT and wasteful, that unwise invest
ments may be legally made and that
| trustees may deal Indirectly with the
Il flIn6C hat,
| age. That such a condition of affairs
can exist reflects discredit upon the
| state.
| Legislation is no panacea for the
Ills Of the body polite that rise from a
| d1sordered moral sense. The muItipli-
| cation OF penal statutes does not d.
| mlnish the spirit Of lawlessness, but
is rather symptom of growth. But it
| Is apparent that our insurance law is
In some particulars obsolete and made
quate and that the management of the
| IunoS or those great companies Is not
| sufficiently safe guarded.
| The state owes duty to policyhold-
ers and beneficiaries beyond that of
| comparing assets with liabilities and
permitting the companies to Justify
| their existence by the exhibition of a
| satisfactory balance sheet and the
prompt payment of losses. Investments
must he restricted, salaries must be
restricted, salaries must be limited to
| amounts bearing closer relation to the
commercial value of services rendered.
| trustees must be held to a stricter ac-
countability and the policyholders must
be given a more effective share in the
government of the companies. 1t may
we'll be that the harsh and arbitrary
remedy of dissolution and receivership
Should be made not only a penalty for
insolvency. but also a summary check
upon solvent company when it be-
comes irredeeemably the plaything of
| lawless greed. The state cannot permit
the subjects of it's supervision to exist
as licensed prodigals of other peoples
money without becoming an accomplish
| tao the offence.
I'VE cannot judge all life insurance
INV he