Evening star. [volume] (Washington, D.C.) 1854-1972, 1906-03-09
-INSURANCEMENH HEARD
IMPORTANT GATHERING AT Al
BANY TO DISCUSS A NEW LAW,

ALBANY, N. Y. March 0.--Probably never
before has a more remarkable gathering OF
life insurance men been assembled under
single roof than that which met today
in the state capitol in connection with the
hearing Of pending amendments to the In
surance law. The hearing on the bills was
had before the joint special legislative in
vestigating committee. which drew upon tt
self last fall universal attention by Its ex-
posures of many Of the conditions surround
Ing the business of life insurance as carried
on in this state
Today's hearing was the first public op-
portunity of the insurance companies to ex-
press themselves upon the provisions of the
ten bills presented by the committee to the
legislature as the result Of its investigation,
and the great and small companies concen-
trated powerful personnel upon the occa-
sion.
Arrangements had been made for very
large attendance, and yesterday 1t became
evident that the great crowd OF insurance
men coming In on every train would tax to
the utmost the capacity OF the big assembly
chamber. Last night the corridors OF the
hotels suggested the night before a great
political convention.
Many radical changes in the state insur-
ance law and kindred statutes are proposed
in the ten bills under consideration. A
iesSuIIiC VI lucSo m6dSuIcS HAS pcch Cal lieu
heretofore in these dispatches.
Assembly Room Crowded.
Long before the time set for the hearing
the assembly chamber was crowded to the
point of discomfort. Former Lieut.. Gov.
Timothy L. Woodruff. president of the
Provident Savings Life. acted as master
of ceremonies and introduced the speakers.
Mr.. Woodruff outlined the program, and
said that former Judge William B. Horn
blower Of the New York Life Insurance
Company would sum up for the insurance
companies.
He introduced President Paul Morton of
the Equitable Life Assurance Society as
the first speaker. MIR. Morton presented
communication in which he began by ad-
hitting that serious evils had crept into
the insurance business and by assuring the
committee that he was in accord with Its
general purposes. He said. however, that
# these bills were enacted without change
it would seriously injure the insurance In
terests Of the state. mot only viii the In
surance companies be unable to conduct
their business in such manner as to pro-
duce fair returns to their policyholders. and
meet the requirements Of the people OF the
state for new insurance. but the conserva-
tive insurance companies Of other states
will be forced to discontinue business in
this state.
I'm short the result of the legislation
which you have recommended will be the
reverse of the result you are seeking to
accomplish"
Mr.. Morton referred to the suggestion that
the bills, even IL imperfect, could be amend
ed at the next session of the legislature,
but pointed out that the investigation had
commanded such widespread confidence
that the example of New York would quite
surely be followed by other states, and
that, therefore, the laws enacted at this
session should be as nearly perfect as pos
sible.
Mr. Morton then took up the changes in
the bills he would suggest, In brief, he be-
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surance companies should be allowed the
same latitude in the matter of investments
as heretofore.
Mr.. Morton submitted schedules showing
the present investments which would come
within the proposed prohibition, considered
under three heads, namely. collateral trust
bonds, railroad stocks and stocks In banks
and trust companies He believed that only
in particular instances should collateral
trust bonds be criticised as unsafe invest
ments. To force the marketing Of all, he
commended would work great damage; that
while insurance companies ought not to be
allowed to continue control of banks and
trust companies, to force them to relin-
quish at once would place them at the
mercy of the narrow market for these secu-
rifles.
He recommended, with reference to exist
Ing investments, that life insurance COM
panies be permitted to retain their present
Investments in collateral trust bonds and in
railroad stocks, and also their present In
vestments In banks and trust companies
provided that in no case shall an insurance
company hold over 20 per cent of the stock
of bank or trust company.
AS for future investments, Mr.. Morton
suggested that they be permitted in collat-
eral trust bonds of companies operating
railroads, possibly restricted to those which
have not defauited for ten years in interest
payments; In preferred or guaranteed
stocks of railroad companies which for five
years have paid per cent, and In no case
more than per cent of the issue He OBJ
net bod IN mr. sod ctc do
policies
Mountaineering Policies.
The large mutual companies should be
permitted to issue non-participating poll
cies. He accepted the proposed limitation
upon new business. but he maintained that
the companies should be permitted to make
good annual losses by termination The law
should fix a minimum, not a maximum con-
tingency reserve percentage. There should
be some limit upon expenses. but the pro-
posed limitation would not allow for in
evitable uncertainties, and 1t was sure to
''paralyze' the insurance business. Insur-
ance companies should be permitted to par
ticipate in syndicate holding securities legal
for insurance investments: otherwise 1t
must pay more for them than parties to
the SyndicateS
He questioned the justice of the proposed
prohibition of directors not directly MEM
beers of financial committees from partici-
patton in syndicates selling securities to
their companies. Such a prohibition he
said. would cost the companies the services
of some Of the most valuable men,
Alexander e. Orr, successor of the late
John A. Mccall as president OF the New
York Life. followed Mr. Morton. He said
that the enactment OF the bills as they
now stand would cut In half the business
OF his company. especially as they would
take effect Immediately. without giving the
companies chance to conform gradually
to the law. He declared that the effects
of the legislation would be felt throughout
the country, and that the responsibility