Omaha daily bee. (Omaha [Neb.]) 187?-1922, 1906-02-23

ministration has been irresponsibility Of
be expected ia the case OF absolute stock
control ia fact Of a mutual company IL
proceeds from a fragrant disregard of the
law OF its being. While IL would be plainly
unwise that the managc>'ent OF life in
surance company shoulu toe rendered unsta-
BILE or that It's personnel should be frequently
changed It IT. OF the FIRST Importance that
officers should realize that their direct re-
spOnsibility To those whom they represent
and should rely for the continuance in
Office upon proved efficiency and not upon
a practical inability OF the policyholders
TO depose them. With these objects In
view the following plan is recommended:
At least five months prior to each cleo
ton, lists of policyholders having at least
81. 600 of insurance in force. properly classi-
fled by states and country's. giving names
and addresses but not amount of insurance
should be filed with the superintendent
of insurance and similar lists should be
open to inspection at the home Office Of
the corporation. Lists also open to inspec-
ton OF policyhOlders within each state and
foreign country should be filed at the gen.
cral agencies of the company In such
Jurisdictions Voting should be limited to
year before the election and whose policies
are still in force when tho election is held
The board of trustees or directors should
annually nominate candidates to be voted
for at the next election and should file its
nominations with the superintendent OF
insurance at least four months before the
election together with Il designation of
persons to receive proxies to vote for such
candidates.
Independent Nominations.
1t should also be provided that any group
OF 100 members should be privileged to
make and file with the superintendent i'm
dependent nominat lions. together with
names of persons who will receive proxies
to vote for the candidates, at least three
months before the election. The corpora
ton should be required, at least two
months prior to the election, to mail to
together with a suitable ballot containing
the names of all the candidates whose
nominations have been duly filed with
properly addressed envelopes enclosed for
the return of the ballot. The periods
above mentioned have been fixed In order
| to give opportunity to every distant policy
holder. Votes should be limited to the
nominated candidates, and suitable pro-
visicns should be made for new nonna-
lions and the casting Of votes under
proxies i'm case of the death or incapacity
OF any person nominated. Provision should
also be made for the proper custody Ut
persons should be appointed to act as
inspectors Of election.
No confidence in stock Control
The committee in its remarks on stock
insurance companies. recites the purchase
of controlling interest in the Equitable
Assurance society by Thomas F. Ryan and
the placing of the voting power in the
hands of the trustees selected by him.
NO exception can be taken to the ability
the judgment and the character of those
who are acting as trustees of a majority
of the Equitable shares" says the COM
mittee but their appointment and their
efforts to ascertain the wishes of the policy
holders n guide to the selection of an
ultimate majority of the board affords a
most important exposition of the convic-
ton that stock control of large insurance
corporations, no longer commands conf
dence."
AmaOhO1pnt IN twisting lie
mended to confer on directors of stock
companies the power to grant policyhold-
ers the right to vote for directors. A fur
Their recommendation is made that oppor-
tunity should be afforded stock companies
to convert themselves into purely mutual
companies, but the committee does not be-
lieve that this conversion should be made
compulsory and suitable safeguards should
be provided so that no stakeholder shall
be deprived of his right of property with
out his consent.
As tn Investments.
On the subject of the investments of life
insurance companies the committee, after
declaring against "syndicates," recon-
n;ends that the law be amended so as to
provide:
First-That no investment In the stock
Of any corporation shall be permitted ex-
cept in public stocks of municipal corpora
second-That Investments in bonds So
cured to the extent of more than ono
third of the entire security therefor by
the hypothecation of corporate stocks shall
be prohibited.
Third-That no loans shall be made upon
stocks and bonds which are not the sub
ject of purchase under the above pro-
Fourth-rhat every company now owning
stocks or bonds OF the prohibited classes
shall be required to dispose of the same
W
end each year prior thereto shall make
reduction of the amount of such in
vestments to an extent approved by the
superintendent of insurance.
Fifth-The statute should forbid all syn
dictate participatons, transactions for pur-
chase and sale on join account, and the
making of any agreement providing that
the company shall withhold from sale Tor
any time or subject to the discretion Of
others any securities which it may own
or acquire.
sixth--It should also be provided that no
officer or director should be pecuniarily
interested either in as principal, co-prin-
cipal, agent or beneficiary in any purchase
sale or loan made by the corporation eX-
cept In the case OF loan upon his policy.
The committee recommends limiting the
amount of new business which each of the
larger insurance companies may take to
$3.50, 100000 a year and that no company
doing business in the state except the
Industrial companies, shall issue policies
in excess of certain prescribed limits.
The report continues:
Politics and Lobbying.
Contributions by insurance corporations
for political purposes should be strictly
forbidden. The committee recommends the
passage passage Of an a Haeq9iyocal and drastic
should 1t be expressly prohibited and
treated as a waste of corporate moneys,