The Yakima herald. [volume] (North Yakima, W.T. [Wash.]) 1889-1914, 1905-07-26
Will Investigate
new YORK LEGISLATURE TO LOOK
into LIFE INSURANCE.
Special Joint Committee OF House
end Senate With Ample Powers
win Conduct lnqulry-flesss0e
on the Subject bv Governor
Hl0nlnS.


b legislative investigation Of life
Insurance a. carried On in the state
both by New York state corporations
and those in other states doing business
In this state.
This investigation will be made BY
q special joint committee with ample
powers, OF which the chairman will be
Senator william Armstrong, of Roches-
ter, Republican. The other senators
on the committee will be william G..
Tully, Of Corning, Republican, and
Daniel ]. Riordsn, of New York city,
Democrat. Senators Armstrong and
Tully are lawyers; Riordan 10 q real
estate and insurance agent. The two
Republicans were selected BY Governor
Higgins and Senator Raines, Republi.
can leader in the senate. The assem-.
bly, members Of the committee will be
named by Speaker Nixon within the
next day or two.
Chairman Armstrong said that while
the actual hearing by the committee
would probably not begin for some
time, tho preliminary preparations
would be Get in motion a. soon as pos
sible and the organization Of the com.
mittee would take place as soon as the
assembly members had been appointed.
Higgins Sends fjesss0e.
The institution Of the committee fol.
lowed hard upon a message of Gov.
Higgins to the Legislature, which came
40 q surprise. The message was re.
ceived in the senate after the conclu.
sion Of the Hooker case, and was not
read until late in the afternoon session.
In the course Of his message, Gov.
Higgins said:
"The unfortunate scandals already
made public by the internal dissensiona
of the Equitable Life Assurance Soci.
ETY. and by the comprehensive investi-
cations of its affairs by the superin.
tendent Of insurance have not without
justification aroused feeling Of in.
tense alarm in the breasts Of thousands
Of our citizens, who have invested
their money in policies Of life insur.
ance, and Of the thousands Of nor. resi-
dents who have been taught to respect
the New York companies as safe and
secure.
Though the business Of life insur.
ance. as at present conducted. is sub.
jected to state supervision and regula.
ton, it 10 evident that earnings which
should be credited to the policy hold.
ers may be diverted to other purposes,
that expenses Of operation may 90 OK.
travagant and wasteful; that unwise
investments may be legally made, and
that trustees may deal indirectly with
the trust funds for their personal ad.
vantage. That such condition of
affairs can exist casts discredit upon
the state. It is apparent that our in
suranoe law 10 in some particulars in.
adequate and that the management Of
the funds Of these great companies ID
not sufficiently safegusrded.
Duty OF State.
"The state owes a duty to policy
holders and beneficiaries beyond that
Of comparing assets or liabilities and
permitting the companies to justify
their existence by their exhibition OF
satisfactory balance sheet and the
prompt payment Of losses. Investments
must be restricted, salaries must be
limited to the amounts bearing q clos.
or relation to the commercial values of
the services rendered, trustees must be
held to strict accounta bility and the
policy holders must be given q more
effective share in the government Of
the companies. 1t may we'll be that
the harsh and arbitrary remedy Of dis.
solution and receivership should be
made not only q penalty for insolvency
but also summary check upon a col.
vent company, when it becomes ire.
deemably the plaything of lawlesa
greed. The state cannot permit the
subjects Of its supervision TO exist al
licensed prodigals of other peoples
money without becoming an accom-.
plice to the offense.
"We cannot judge all life insurance
companies by the sins Of one. A re.
vision of our insurance law 10 neces.
sary, but it should be made after care
full study and investigation"
DANIEL SCOTT LAMONT
EXPIRES SUDDENLY