New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1905-09-07
TIE INSURANCE PROBE.

- .-onoa Investigation is ausplclouslS -
NOT sensationally begun. Inc Cum -,
vota3 its initial session yesterday W 'no
30 foundations The officers OF Jill & eA.
nanies were on the stand to tell OIL tne .as
zation Of their institutions, WIN p"i
erence to the methods by WHICH poAe' ., .or,-
nor+sc,nete in the control Of the mutual -
pontas Mr. Hughes examined the WITNESSES
- .,,o San,a husiuesslike directness ana ciea.
,ass which was so effective In the gas lh'ee'
cation avoiding all claptrap, but enecu'ei' s'~
ting at the significant facts. ,,,,,+,,ar
Ie ,,-os made nerfectly evident that the mutuai
character of the leading companies is an u'tei
farce. so far as any real parucipa'ion y. ~
noIicvholders In their conduct IS concet ne'
Year after year the only proxies Voteo arc
,azp held by the officers, and the votes III person
~ oo.t nv officers. No effort even Is mace
IN secure proxies from the general Douy "a
oo1,oybolders but each year, in one company,
sn,a1I fraction of them only receive an ln'l'"
ton 70 participate few thousand clrculat'
era sent ont at random, though 1t might easily
no IN selected favorites, and the adnlhlsu a'ioA
REFLECTS itself merely matter or lorm-
An Interesting question was raised as 10 tne
possibility Of organizing an opposiuoh ilo>
ment. Mr. Hughes asked a representative VI
the Mutual Life Insurance Company II pm
holder would be allowed to look at the hst o.
hia fouoxy noucvholders with the view of COM
rnunfcating with them concerning an election
The official declined to commit himsel1 one way
or the other on that point Obviously, IL ILLS
Is not allowed. the officers are the sole avenue
of communication, and any attempt 10 eecui
nroxfes in opposition to the powers that De
would be hopeless. On the other hanu' liie
opening of lists of policyhoders might ohec
rivals chance to undermine compan! pusf
ness 1t is much the same question as that pre-
lorr or ak
GERS be allowed to conduct affairs in secret anu
deny stockholders information necessary 10
their protection. or shall the door be opened
to attacks on the interests Of all the Stockholm
ers with the aid of inside information ABOUT
cornoration's business? The problem of secur-
ing real naturalization without sacrifice or ao-
mtnistrative efficiency and continuity OF man
agement is most difficult Participation OF
policyholders which Is matter Of course a
ratification of the regular ticket amounts TO
little or nothing It's only possible usefulness is
as a potential weapon in case of great scandal
and need of ousting bad management
significant feature of the proceedings was
the opening address of Mr.. McKeen, reviewing
| nreyious legislative investigations of insurance
and pointing out that in 1877 the late Henry b.
Hyde had testified that the Equitable surplus
was not being accumulated for the benefit of
the stockholders but was for the policyholders,
only what was represented by the payment OF
the per cent annual dividend. Undoubtedly
the stock control of such a company has a
larger legitimate value, Quite aside from any
question of milking it by subsidiary companies
or using its funds for speculative purposes such
control carries a power and consequence which
many honest men might consider worth large
sum Of money. Even financially, the chance to
be president or president even at what
would be thought moderate salary, is worth
more than the capitalization of the income of a
majority Of the stock. Nevertheless, the stock
can have no such extraVagant value for legitl-
| mate purposes has in later years been put
upon IT, and Henry B. Hyde's statement is an
| impressive commentary on the conception OF
| life insuran, alone which could give rise to
such estimates and offers. 1t is also valuable
| bit Of evidence bearing on the recent claim up
held in court that the surplus, long held out
officially to the pocyholders as their property,
| belongs to somebody else
The first days work Of the Armstrong COM
| mittee was certainly good one.