The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1905-11-14


concerned we have printed the news con-
cerning these investigations because our
readers had the right to know all the
facts oncumstant,atty, and It Is no Won
der that the people were startled and
OUTRAGED at the disclosure. But we have
been careful In our editorial comment to
Impress upon our readers that only Il
few OF the companies had been invests
10 be innocent until proven to be guilty,
and tlm II would be stupid to abandon
life insurance altogether because the OIL.
Gers of few great companies had been
untnithful.
But the Spectator is entirely too lenient
in Its criticism, Of the management OF
those companies which have been In
vcstigated. 1t asserts with n show of
satisfaction that mo criminal offonsc Ia
charged against any officer but Is an
officer of life insurance company free
from wrong doing simply because ho
manages to escape criminal prosecution?
The Spectator admits that there has been
extravaganza In the payment of excess
sive salaries and of the expenditure OF
money in unwarranted directions. 1t
might have added that one OF the COM
panies recently under investigation now
confesses that expenses have been re-
duced in the enormous sum of S6000O per
annunr. This means that the company
has been annually wasting or misappro-
prn,ing the funds of the policyholdcrs
in that amount, and that Is an extrava-
nance which at least approaches criminals
ity
The Spectator declares that there has
been no graft but it omits to state that
all sorts of syndicate operations were
carried on privately by the officers, using
tho funds of the pollcyholders for that
purpose and putting the profits into their
own rockets. If that Is not graft 1t Is the
next thing to 1t.
Finally the Spectator declares that
mo pollcyholder has been wronged to
any extent, for he has had and still en-
t5ys that which he paid for, insurance
upon his life, and there Is to his credit
in the hands of the company that In
sured him certain sum, the exact
amount OF which will be determined and
paid to him upon the maturity OF his
policy
That statement might be comforting
and satisfying, IL all Insurance were
mon participating" insurance, but EtlL the
Spectator overlooks that many policy
holders were Induced to pay higher pre-
mums for participating policies under
promise that the company was making
handsome profits and that each and every
&policyholder would set his share of the
dividends at the maturity of his policy.
In that view of the case, in view OF the
fact that one company has expended
unnecessarily 100000 a year, is no holder
of a participating policy wronged? Has
no injustice been done him when money
which should have gone to the credit OF
his nolicy has been misappropriated, or
unnecessarily expended by the manage
tmellt? The question answers itself
There is no justification that any de-
fender of tho managers Of these in
surance companies can make. They have
outrageousy abused their trust, and
whether criminal or not in the eyes of
the law, nevertheless defrauded the
policyholders.
Our remarks do not apply to any COM
pany except those which are guilty, and
our indictments not of all life insurance
companies and no argument against the
principle OF life Insurance. On the con-
trary these exposures and revelations
have brought about a reform in the man
asement Of insurance companies. and we
and we believe that life insurance to-day Is
safer than ever 1t was. But the pubic
should have learned by this tinre that
participating Insurance comes pretty high
and that dividends are not large as
promises