Evening star. [volume] (Washington, D.C.) 1854-1972, 1906-04-18
1t Will Be in the Department of Com
MERGE.
DESIGNED TO PROTECT PUBLIC
Letter of Superintendent Drake Ex-
planning the Provisions of
the Bill

Ter Ames (MassD. 1t provides for the
establishment OF Insurance bureau in
the Department of Commerce and Labor
and for the appointment of a commits
sioner who shall have no official connec-
ton with any insurance company or who
shall not be interested In the business Of
any company except as policyholder
The commissioner is required at least once
in three years to examine all companies
doing business In the District of Column
bia. Forms prescribed for the issu-
ance of annual statements, and the COM
missioner is authorized to demand other
information from the companies IL he be-
lieves 1t is necessary.
If, upon examination the commissioner
Is of the opinion that any domestic in.
surance company is insolyent has
ceeded its powers is In any manner
transacting business contrary to the pro-
visions of this act the bill provides that
the commissioner shall lay the facts before
the Attorney General who may apply to
the Supreme Court Of the District for an
injunction restraining it's further business.
Under the same conditions he is authorized
to revoke the certificate of a foreign in
Surance company.
A minimum capital stock of $4,000 Is
proposed for accident companies; 100000
for plate glass and elevator insurance, and
100000 for all other companies. 1t limits
the investment of capital stock. Companies
stock plan.
Directors are made liable for any Illegal
investments and companies are not per
mitted to do both a participating and non
participating business
Under the requirements for organizations
of insurance corporations the capital stock
shall be paid in within twelve months after
the date of organization, but no policies
shall be issued until the capital stock has
been paid IN. The bill provides for the in
vestment of the capital of domestic COM
panies practically as is provided by. the
Ames bill
The bill contains a plan whereby all
policy holders shall be enabled to partici-
pate through proxies in the election of d.
rectors at the annual meetings. The sal
aries of all officers and agents over 1000 a
year must be authorized by vote of the
board of directors of the insurance cor
poration. Pensions cannot be voted to
members of the family of an officer after
his death. and disbursements Of over 500
require properly itemized vouchers.
The bill prohibits rebating of portions of
premiums, and discrimination between
classes of insured Standard forms of pol
icies are prescribed. A policy cannot be
forfeited after the payment Of two full an
nual premiums. No insurance company
which issues contract. the performance
of which is contingent upon the payment
of assessments made upon survivors. shall
do business within the District. 's--s~ ~
Provision Is also made for fire, marine,
casualty. title. fidelity and surety insur-
ance companies by the bill.
agents, are prohibited from making politi-
cal contributions.
In letter commenting on the bill Thos
E. Drake, superintendent of the depart
ment of insurance for the District of Co
lumbta. says that 1t makes very few
changes from the general and ordinary pro-
visions of law in force in the various
states.
The letter of Mr.. Drake addressed to the
President in reply to a request of the lat
ter asking that the salient features of the
Ames bill be stated, Is follows:
First. 1t will furnish the District Of
Columbia with clear. concise insurance
code (our present insurance laws are de-
fective and ambiguous, therefore exceed
ingy difficult to administer) based on eX-
perience Of some of the states Of more than
half century. The bill also contains fea-
lures that are devised after mature
thought and reasoning by some of the best
insurance experts and lawyers of the coun-
try that VIII be beneficial to poiicyholders
and the insurance public.
Second. 1t Will provide for a properly
equipped bureau of insurance which will
be able to make examination of all foreign
insurance companies that desire TO do BUSH
ness in the District of Columbia domestic
companies, too, when requested by any
insurance commissioner and the company
to be examined although il may not want
to qualify here.
Third. The result of this examination
of foreign and domestic companies will no
doubt be accepted in time by the various
state insurance companies. thereby saving
the cost to insurance companies of numer-
Gus examinations and the accounting also
to forty insurance departments
Fourth 1t will abolish taxation on in
surance premiums for revenue; also the
arbitrary advertising of the companies an
nual statements In newspapers and trade
journals, which advanced step should be
taken by the department at the seat of
our national government.
Code of Law Created.
Fifth. The bill creates a proper code of
law for the incorporation of insurance
companies within the District of Column
bia. 1t provides for the organia ton of
companies on the temporary stock plan.
and that life insurance companies issuing
participating policies shall not do business
on a non-participating plan. 1t limits the
investment of capital stock It provides
for the nomination and election of life
insurance officers by mall proxy, in per-
son or by representatives, limits the life
of proxies and forbids their use in the
hands of officer agent of the com
pany.
ut provides for non-forfeiture of policies
after the payment of two full annual pre-
miums and the annual accounting and an
nuai distribution of dividends 1t also
provides the standard forms of policies
adopted by the New York legislative COM
mittee, which must be plainly printed on
dividend periods. and allow such other
forms as the insurance commissioner, after
full hearing, may prove.
Seventh 1t requires board OF direc-
tors to fix the salaries annually of all Of
ficers, trustees, directors and agents, whose
salaries exceed 5000 per annum and re-
quire itemized vouchers for all disburse-
ments over 500. 1t also provides for great
er publicity through the published annual
reports of the various insurance depart
ments and prohibits an insurance company
or it's agents from making political con-
tributions.
Triennial Examinations.
Eighth. 1t requires all companies doing
business In the District Of Columbia to be
examined every three years. or oftener If
deemed necessary by the commissioner. 1t
requires the reserve OF life Insurance COM
panies doing business in the District Of
Columbia to be calculated annually as of
the 31st day OF December, next preceding,
by the actuary of the department and per-
mits valuation of policies the first year on
the preliminary term plan. 1t forbids dis
elimination between insurance OF the same
class and equal expectation OF life and pro-
hfbits pensions.
Assessment Insurance.
Ninth. 1t prohibits insurance to be
transacted on the regular assessment plan
and also prohibits estimates to be used as
to the future course Of old line life insur-
auee and dividends that are likely to be