Omaha daily bee., 1905-08-08
CONGRESS OVER INSURANCE
Government Control Of Business Advocated
by American Bar Committee.
CHAIRMAN BRECKENRIDGE DRAWS REPORT
Minority Statement VIII BE Presented
but Majority is Expected TO Have
weight with Next
Congress.

First-Legislation/ by congress providing
for the supervision Of insurance
second-1'he repeal Of all valued policy
laws.
Third--A uniform fire policy, the term of
which shall be specifically defined.
Fourth-The repeal Of all retaliatory tax
Fifth-Stricter Incorporation laws in the
several states as they anect the creation
OF insurance companies and a, federal stat
ute prohibiting the use of the mails to all
persons, associations or corporations trans
acting the business Of insurance in disrc-
gard of state or federal regulations,
These are the five recommendations that
will be made to the annual convention Of
the American Bar association at Narragan-
sett Pier August 23-4-5, by its committee,
on insurance. Ralph w. Breckenridge Of
Omaha is chairman Of this important COM
mittee and as such has drawn up the re-
port
1t is expected that action on this report
by the bar association will have a de-
cided effect on the action TO be taken later
by the congress. A great many Of the
members OF congress are alSp members OF
the American Bar association, and natur-
ally they will be interested in any recon-
mendation to which the association may
give its Endorsement.
The committee is composed of Ralph
w. Breckenridge Omaha. chairman; Bur
ton Smith, Atlanta, Ca; r. A Mereur,
Towanda, Pa. w. A. Hemenway Of Bos-
ton. who is to deliver the annual address
to the bar association this year, and w.
r. Vance of Virginia.
Minority Report by Vance.
Mr.. Vance is expected to OFFER a minority
report in which he will disagree with the
committee, not on the general findings, but
on the proposition that there is no consti-
tutional obstacle existing to the inaugura-
ton of federal supervision Of the insur-
ance business. Mr.. Vance believes 1t
would require an amendment TO the ma
tional constitution to permit of the gov
ernment taking over control of the busi-
ness.
The report at the outset makes note of
the fact that the amount of insurance of
all kinds in force in the United States
approximates S5OOOO,O0O,Oo0 and that the ag-
gregate assets of the companies approxi-
mates S3,OOOOO 900. The American people
pay annually for insurance of all kinds.
| 81. 900 100000 in round figures and they re-
ceived back in the year ending December
| 81. 1904, 100000 This is exclusive Of fra
| ternal beneficiary associations and local
mutual fire insurance companies.
Roosevelt Favors Plan.
ITeSluenI lNOOStNtell - NubNth 40 nav MS
said to the committee that he is very much
in favor Of federal supervision of insur-
ance, and his utterance on the subject in
! his message to congress of December g.
| 1904. is quoted at length
OF the sentiment of the insurance COM
panies themselves with regard TO the
widest publicity for their affairs, the re-
| port says:
| Publicity as related to corporations that
| have or seek either public franchises or
| public favor means more than a newspa-
| OF assets and liabilitiese. 1t means that
! each company must show to that depart
vested with power in that regard, what II
| is doing with the money IL receives; that
nomicaiIy, no Tr and that its business is oper-
| ated upon a plan which experience mas
| shown will enable 1t to afrord the protec-
| tion 1t offers to its poltcyholders
After an introduction to the subject Of
federal supervision and the question Of It's
desirability, the report says:
| The officials of the leading companies
| life, fire and accident-recognize the steady
| growth of the sentiment In favor OF ma
tional supervision, and they generally favor
| II II thereby the fOrty-nine state depart
ments to which they now must make re-
| turns will be superseded. The Leading
! state insurance commissioners are also In
| favor of federal supervision.
| No one has offered any substantial reason
| against federal supervision and II Is advo-
Gated by the president Of the United States.
| many state Insurance commissioners, IA
| vored by leading insurance officials and
| numerous able insurance journals. Besides
these. the general press Is in favor of any
| movement in the direction of greater cor
porate publicity and the patrons OF i1srr,
OF the business, as the national banks are
supervised.
state Plan il Denounced.
The receipt by state insurance depart
ments of several millions yearly In excess
of what supervision costs is denounced as
| iniquitous and the report says the expense
! Of federal supervision would not be over
! 10 per cent of what state supervision now
costs thus lifting IAN unnecessary burden
from all who seek to provide for their fam
lilies and to avert disaster from fire through
| insurance"
Discussing the matter OF taxation. the re-
| port says certain states tax foreign COM
panies higher than they do their own COM
panies The states using the retallatory tax
alton system are alluded to having for
| gotten that this is a union OF states" Such
| laws are denounced in their spirit hos
! tile to the federal compact, and increase
the cost OF insurance ia the retaliatoTy
state"
Federal supervision is held as a remedy
| for this vexed problem OF taxntlon, and,
! besides IT is set forth would require a
strict accounting of the uses made of the
immense sums accumulated through the
prudence, sacrifice and thrift of millions
OF policyholders and will prevent improvi-
dent and improper investments and ex-
traVagant management
Assuming that federal supervision is con-
stitutional, practicable and desirable, says
the report, the plan by which it can best
be accomplished must necessarily be left
| to congress. on the matter Of planted
eral franchises or national reincorporation
the committee refuses TO express an opin-
ion.
| Interstate or NOtG
he question OF whether or not insurance
is interstate business is gone into at length
and a long line of decisions are quoted
touching the point. he report says:
1T does not follow because a thing Is
new that It may not be covered by the
constitution, for Marshall characterized
the constitution as intended 70 endure for
ages to come and consequently to be
adapted 10 the various crises of human
affairs " 1t Is set out that but for insur-
ance commerce as we know It, credit as
II is. civilization as We live IL, would not
have been possible"
Numerous decisions and opinions Of pub