The Providence news. (Providence [R.I.]) 1891-1906, 1906-02-22
INSURANCE REPORT
SCORES MANAGEMENT !
Continued from page One.


and for such other purposes as are au-
thorized 10 be connected Herewith In the
case OF stock corporations. PROVIDED AT
least Ave hundred persons have subscrib-
ed 10 become members therein in the ag-
gregate amount OF at least 100000 10 be
insured upon their lives and shall have
each paid I'm one full annual premium In
cash upon the insurance subscribed for
and provided further that II shall make
the same deposits with the superintend-
ent OF insurance, that are required OF
stock corporations formed for similar pur-
poses.
NO MORE ASSESSMENT COMPANIES.
Section 200. permitting the incorporation
OF companies upon the cooperative or as
sessment plan. should be amended SO as
10 not permit such companies 10 be in
corporated I'm the future, and foreign com
panies Of this sort not already transacting
business In this state should not be per-
mitted 10 enter the state.
Concerning the socalled mutual com
panies. the committee says:
Notwithstanding their theoretical rights,
policyholders have had little or no voice
In the management. Entrenched behind
proxies easily collected by subservient
agents and running for long periods. un..
less expressly revoked. the officers OF
these companies have occupied unassail-
able positions and have been able 10 exer-
else despotic power.
SOURCE OF EVIL
Ownership OF the entire stock of an
unmixed stock corporation scarcely could
give a tenure more secure. The most
fertile source OF evils In administration
has been irresponsibility OF officers
power. However much this may be ex-
pected in the case OF absolute stock con-
troll In that OF mutual company. II pro-
ceeds from a hagrant disregard Of the
law OF its being. While II would be
painly unwise that the. management OF
life insurance company should be rendered
unstable or that It's personnel shoYld be
frequently changed 1t is of the first inn
portance that officers should realize their
direct responsibility TO those whom they
represent and should reply for their con-
tinuance I'm office upon proved efficiency
and not upon practical inability or the
policyholders 10 depose them:
With these objects I'm view the following
plan Is recommended:
PLAN RECOMMENDED.
At least five months prior to each cleo
ton lists OF policyholders having at least
5000 OF Insurance in force properly clas-
sifed by states and countries, giving
names and addresses, but not the 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 inspection OF policyhoders within
each state and foreign country should be
filed at the general agencies of the com.
pany in such jurisdiction. Voting should
be limited to those who have been insured
at least one year before the election and
whose policies are still In force when the
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 su-
perintendent of insurance at least four
months before the election. together with
a 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
10 make and file with the superintendent
independent nominations, together with
names Of persons who Will receive proxies
90 vote for the candidate at least three
months before the election. The cor
poration should be required at least two
months prior 20 the election TO mail to
each policyholder notice OF the election.
together with a suitable ballot contain
Ing the names OF all the candidates whose
nominations have been duly filed with
properly addressed envelope enclosed for
the return Of the ballot.
The periods above mentioned have been
fixed in order 10 give opportunity to
reach distant policyholders. Votes should
be limited to the nominated candidates
and suitable provisions should be made
FOR new nominations and the casting of
votes under proxies, in case OF the death
or incapacity of any person nominated.
Provision should also be made for the
proper custody of ballots received by mail
and dislnterested persons should be APP
pointed to act as inspectors OF election"
STOCK COMPANIES.
AS to stock companies. the committee
recommends naturalization.
on the subject OF the investment OF
life insurance companies the company
after declaring against "syndicates,"
recommends that the law be amended so
as TO provide:
/. That no investment in the stock OF
any corporation shall be permitted except
in public stocks OF municipal corporations
2 That investments In bonds secured
TO the extent OF more than one-third OF
tho value OF the entire security therefor
by tho hypotheticauon Of corporate stocks
shall be prohibited.
& That no loans shall be made upon
stocks and bonds which are not the sub
ject OF purchase under the above pro-
visions.
T. That every company now owning
stocks or bonds OF the prohibited classes
shall be required 10 dispose of the same
within five years from Dec 81, 1906, and
each year prior thereto shall make n re-
duction OF the amount OF such invest
ments TO an extent approved by the su-
perintendent Of insurance.
8. The statute also should prohibit all
purchase and sale on joint account, and
the making OF any agreement providing
that the company SHALL withhold from
sale for any time. or subject 10 the dis
cretion OF others any securities which q
may own or acquire.
g. II should also he provided that no
officer or director should be pecuniary In
any purchase, sale or loan made by the
corporations, excepting In case OF loan
upon his policy.
The committee recommenos limiting the
emount of new business which each OF the
larger companies make take 90 $50 200. 900
a year and that no company doing busl-
ness in the state. except the industrial
companies, shall issue policies In excess
OF certain prescribed limits
POLITICAL CONTRIBUTIONS.
Contributions by insurance corpora tions
for political purposes should be strictly
forbidden. Neither executive officers
nor directors should Re allowed 10 use
the moneys paid for purposes OF insur-
ance I'm support OF political candfdat es