Omaha daily bee. (Omaha [Neb.]) 187?-1922, 1905-08-18
Breckenridge said in part:
Gets Public to Thinking

AAis ~ tI ASlll luBb Hdlu III part
Gets Public to Thinking.
Recent disclosures in connection with the
management of the Equitable and other
companies have set the public thinking and
talking about a new subject. and the gem
eral Ignorance about Insurance. which had
passed into proverh is being replaced by
knowledge, Indifference has given way to
a spirit of keen inquiry and public senti-
the condemnation and expulsion Of un-
SOUND and irresponsible companies, the
aooi i OF a system OF STATE SUPERVISION
OF insurance under which blackmatl has
| become science and high crime and dis
honesty flourish and grating without limit
has reduced the funds which men by toll
and sacrifice have saved to provide for their
wives and children and for themselves
when old age erects an impossible barrier
against the activities of life.
You doubtless are familiar with many
features of insurance supervision, mscalled,
that your companies are required every
year TO pay certain sums in fees and taxes;
nut on what q. p pre- ten SO vast sum of
money as S25OU,OOO should be annually
exacted by the states from the insurance
companies Of America or what possible
advantage the several states can confer
upon either companies or pOlicyholders in
| return for this enormous drain no one can
tell. The best and perhaps the only reason
| is that money in sight is easy to get at
| The ignorance at the bottom of all such
| legislative ralding is both astounding and
| intolerable, these burdens are laid upon the
| shoulders of the polcyholders and not on
| the corporations which transact the insur-
ance business: 4 aim recognition of this
! truth penetrates the legislative mind when
| through local influence or log-rolling laws
are enacted which discriminate in favor
| of local companies as against those of other
| states and countries.
Robbed Under Form of Law.
Moreover, as already shown, the states
| have long since departed from the policy
| of merely supervising insurance companies
| and exercising the function of sovereignty
| which requires from these companies a
| demonstration of solvency and sound bust
ness methods and many of them have be-
| come as remorseless in their exactions as
| highwaymen; but they have robbed the
people in the name and through the ma
| chinery Of law. So dense has been the
| public ignorance of the principles which
| underlie legitimate underwriting and so
| supine the public Indifference to the treat
ment accorded by state legislatures to the
| insurance companies that 1t has become the
! fashion to exact money from them as
| though 1t were a virtue instead of wrong,
as though II were good business and not
| folly, and l have seen the report Of the
| insurance commissioner of a nearby state
! TO the governor of that state which boasts
that more money was produced last year
| by his department than by any other branch
1 OF the state government
It is certain that when, the people who
! yearly pay $1,000 10000 for insurance find
! out that they are being plundered whether
through needless or excessive taxation or
by dishonest insurance officials who put
on the airs of a Roman governor and treat
the money of their policyholders like the
tribute paid to one, they will arise in their
wrath and might and put a stop to both
KINDS or plllage. II is nigh time to awake
! No legitimate business is so constantly as
sailed, so cruelty burdened, so little under
stood as yours, and you are not free from
blame for this condition of affairs. You are
to blame because you have permitted your
| companies to be robbed right and left, on
| the theory that YOU have not been in
| dividually prejudiced; because you have not
raised your voices in the states where you
| live against inCompetency or corruption in
| the insurance departments of your several
states; because you have been so com
! pletely immersed in COmmerCialism that
asks to be let alone at any price that you
have submitted to the domination OF cheap
politicians rather than to stand out boldly
In your several communities in fearless and
emphatic denunciatlon of the dishonor and
wrong done your business and, through the
| companies you represent the people you in
sure. You. the local fire insurance agents
Of the United States, have in your hands
the opportunity and the power to correct
these abuses. You can, through your con-
create such clamor for an economical and
efficient supervision of insurance as shall
surely bring II about.
state Supervision Ineffective.
The public has no confidence in state SUI
perViSiOn. The companies expect from the
insurance departments of the several states
only demands for money, and the state in.
surance commissioners, with some very
notable exceptions, seem to regard the com.
panies as sheep to be shorn and their pub
tic service performed when they make then
pay the last farthing. This Is not super.
vision; II gives no protection to the public
The state insurance departments are mere
collection agencies created and kept run,
ming to help some state officer pay off his
political debts. OF course the states can.
not be deprived Of the exclusive regulation
Z Of interstate business-that Is, bushes!
done by the companies within the state,
where they are created. But the time has
arrived for a change from state supervision
| of interstate insurance-that is, bushes!
done by the companies within the states
| where they are created-to supervision tina
aims at something higher and better thar
the collection Of tolls and license fees; tina
will require an accounting OF the uses mad,
| of the Immense sums accumulated through
the prudence sacrifice and thrift of mil
lions of policyholders; that will forestal
| improvident and improper investments ant
eXtravagant management; that will punisl
the fraud II does not prevent; that will re
duce the cost of insurance by cutting OF
many millions of dollars OF useless expendi
lures under the present system.