The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1906-02-23

ture cannot undertake the manageYnenf
o. the business. In seeking to secure
economical administration it should not
overstep the line which divides suita-
lie state supervision from an utterly
inpracticable effort to prescribe de-
tails
The legislature should aim to per-
nit freedom of management subject to
general regulations and complete pub
licity. For example, it is deemed I'M
wise to limit salaries by statute. but
II should be provided that all salaries
of officers and the compensation of
any other person receiving over a GER
tain amount, say $1,000, in any year,
should be fixed by the board of dj-
rectors and not by any committee
thereof, or by any legislative officer
and should be reported in the annual
statement to the superintendent of in
surance.
The evidence, however, makes it
clear that the most wasteful expense
mess. Every company profeSSed to de-
plore this, pleading that competition
rendered it unavoidable.
By the Limitation of their new bus
mess the three great companies will
be able very largely to diminish their
agency expenses This will also re-
lieVe the smaller companies to
marked degree of competition to which
they have hitherto been subject. Some
limitation of the expense in getting
business is imperatively required; 9TH
eriwse there is little reason to doubt
that there will be a continuance Of
the present extravagant methods.
The committee does not recommend
that the rate of commissions be pre-
scribed by law. 1t is recommended
that commissions should be uniform,
that is to say, that while the rate may
vary according to the plan of insur-
ance. the compensation should not be
greater in amount for any $1,000 of in
surance at the same age, and should be
determined by the amount paid in the
case of an ordinary whole life policy.
Bonuses, prizes and rewards and other
special inducements based upon the
size of particular policies or upon the
aggregate Of insurance written should
be prohibited. All commissions should
be definitely agreed on in advance and
should be a fixed percentage of the
premium for each 81 900 of insurance.
It is also recommended that renewal
commissions should be limited to four
years and to a certain percentage, say
10 per cent of the first yearly commits
sions, so that the general restrictions
placed upon the first years expenses
should not be evaded. Loans and adj
VdncCS 10 agents SnOuu DS pIOhiOlOCu-
Valuation of Policies.
The committee recommends that the
law be so amended that minimum
standard for valuation of policies other
than industrial should be established;
and that preliminary terms in the val
uation of policies issued after 1906
should not be permitted. The super
intendent of insurance should be re
duired to fix a legal minimum stand
ard. Assessment and cooperative
ccmpanies should be compelled TO
maintain a reserve not only equal TO
the proceeds of one death or disability
assessment. but also at least equal to
the cost of insurance for two policies
in accordance with the expense table
of mortality until the next call Any
reserve provided for by the articles OF
association or by laws or by the con-
tracts with the members or any he
insurance company should be charged
az a liability in accordance herewith
Rebates.
The law as to rebates is sufficiently
stringent but as a further pTecautiCn II
is recommended that the penal code
should be amended so as to provide that
a person receiving a rebate should De
equally guilty with the one who gives It.
Surrender Values.
With regard to new policies, the pro-
visions of the statutes should be liberal
lied, and the insurance: in the absence