New-York tribune., 1906-05-07
INSURANCE CLEANED UP
LEGTSL4TURE'S BIG JOB.
Legislators BcEieue Symmetrical
Plan Has Been accomplished.
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administration which made Il possible ara a,ss
80 largely IN carrying Il the gratitude 10 s1
vast army of policyholders which the Armstrong,
committees legislation will safeguard Confronto1
with gigantic undertaking. the Armstrong corn
Tittee and its able counsel. after the unomentou~
disclosures OF the four months investigation
ed remedial measures which focused tho ewes %
the whole country and most OF the civilized zvnr1s
on the body Of which was to consider thorn
Their passage gives TO New York State what ss
believed 10 be the most perfect insurance code OF
any IN the country, not excepting the famous Mas
sachusetts laws The laws OF New York State in
future viii. it IS expected. the models for
other states.
Protection for the policyholder is the keynote Of
this legislation-p protection for the man whose
money invested In the company to furnish safety
FOR Lis wife and children rather than any method
Of increasing the company's prosperity. The fnan-
csl soundness OF the companies needed no atten-
ton from the Armstrong committee: the correc-
sion OF abuses from the unwarranted usurpine OF
mower by the officials. the Illegal building up OF
political machines within the companies and the as
suging Of more power and consideration TO the
policyhoders constituted the task OF the investi-
eating committee The series OF nine bills passed
by the Legislature accomplishes this In no uncer-
tain fashion.
Briefly told, the new laws assure the pocyhold-
ers Of due publicity in all the insurance companies
business give to them the franchises nominally
theirs before prevent the vicious system by which
the insurance companies money went 20 the up
building Of subsidiary companies, with the pa
tronage" Of Offices in those companies for the in
siders in the insurance companies arrangements.
forbid lobbying campaign contributions and false
and incomplete statements. and by regulation OF
expenses prevent exorbitant commissions TO agents
and salaries 10 officers Another important step is
the abolshng Of the purely assessment insurance
companies in this state and the preventing OF
foreign assessment companies from doing business
here. As the Armstrong committee presented them
IN their final form, the bills comprised a SYM
raetrfcal plan. which would have been weakened
greatly in efficiency by a change in any part.
PROGRESS SWIFT AND SURE.
Attempts on the part of insurance companies at
The public hearings. held in March, these bills
and Of various legislators during the consideration
q them. 10 change or defeat them, were not
wanting. stu, the progress OF the measures was
swift and sure. in the Assembly. danger threat
ened them al any time In the Senate. strong OBJ
Sections TO one two features crumbled away
until in the last two weeks Of the session came
the White amendment, striking at the root of the
entire reform scheme-the management OF the
companies by the policyholders their elected
representatives. II the amendment which was
passed under sudden. strong pressure. had pre-
vailed. Senator Armstrong declared that the main
feature Of the reforms would have been killed
That such disaster came was due 10 the de-
csve action Of Governor Higgins. who personally
labored to obtain a reconsideration OF the amend
nlent. and whose efforts resulted in Republican
caucus. which pledged those Senators 10 kill the
amendment and pass the bill the special COM
mttee desired II.
The bills were brought to Albany Washing
toms Birthday. after all night session. at which
Senator Armstrong and Charles z. Hughes and the
associate counsel had hastily completed the draft
ing OF the measures. They were introduced that
morning and referred to the Insurance Committee
of each house. Hearings were set down for the
second week in March At these hearings every
Insurance company doing business in this state
represented Delegations of officials actuaries and
agents swamped the Capitol, deluging she special
committee under food of objections which sim
nlered down 10 opposition to two three points.
These we're the fixing Of contingency reserve. the
limitation OF business, the forced disposal OF stock
holdings and the reduction in agents commissions.
II one Of these hearings that Andrew
Hamilton made his sensational denunciation Of the
trustees OF the New York Life declaring that they
and President Mccall knew Of every cent ever paid
10 him. and authorized the payment.
MALBT AND GRADY LED OPPONENTS
As a result Of these hearings the bills were
changed somewhat. chiefly as to the compensa ton
for agents. At various times during the considera-
ton OF the bills the committee made technical
changes and one two slight alterations in def
eTence 10 the arguments made by the opponents Of
the bills notably alteration as TO the contingency
reserve and an enlargement Of renewal oormis-
sions Chief among these opponents, from the Gay
of introduction. ranked Senator Grady, who was
frank in saving that he disbeeved the wisdom of
many Of the provisions, and Senator Malby, who
counselled conservative action
The first of the reform bills passed was the one
postponing the elections Of mutual insurance COM
panies until November Is. This was rushed through
that il might forestall the annual election Of The
New York Life. which would have been held in
prl This bill declared void all proxies collected
prior 10 September Is 1906 thus destroying all the
ammunition which Thomas ". Lawson had accu-
nustel in his warfare against the New York Life
Just before the close OF the session this bill was
rom and
the elections held December IS 1906. This action
vas taken because the officers of the large COM
panies had represented TO Governor Higgins that
they could comply with the requirements os
other bills relative to filing complete lists If policy
holders before elections
me measure prohibiting campaign contributions
~ any corporation save an organization formed for
political purposes result of the disclosures in
ihe investigation concerning the gifts Of the New
York IAfe and other companies I'm various cam
Taigns Little opposition was encountered and 1t
Iassed with colors flying. Senator McCarren made
one Of his few speeches in its favor.
Another drastic measure which was passed easily
was the one designed to keep out the lobbyists II
provided that corporations should file with the
Secretary State duly attested statements of all
expenses incurred in opposing or promoting legis-
laton. directly or indirectly. and that all persons
engaged n promoting or retardng legislation should
register with the Secretary of State. setting forth
the legislation 10 which they employed and
he fees received. Under the provisions Of this
bill many lobbyists have registered already. al
though some Of the men whose names were asso-
ciated with the OldtiTne lobby have registered,
notEIthsa nding they have eeH here often this
sion The measure was opposed by Senator Marks
On tho ground that Il prevented a lawyers TAX
ing legislative work . contingent fee He main
tanned also that II cid not include the lawyers who
Eor FFahifrsaT and Ob.