Vernon County censor. [volume] (Viroqua, Wis.) 1865-1955, 1906-12-26
Socialists Favor 1t.

Socialists Favor 1t.
The minority report signed by Sem
ator Jacob Rummel of Milwaukee,
socialist, differs with the conclusions
of the other two senators and urges
that a commission be appointed to
draft bills providing for the establish
ment of a life insurance department
by the state. 1t outlines the ineffici-
ency of insurance under present condi-
tons and recites the experiences of
New Zealand, Germany, Austria,
Frar ce and other countries and of
Florida in this country as regards
state. insurance The establishment
of insurance by the state would re-
suit in the payment of reasonable sal
aries, the report states, economical
administrations, liberal policies and
absolute security o. the policy hold
ers.
Persistent Agent Necessary.
The majority of the committee
claimed that the amount of business
done by state insurance departments
is unsatisfactory as compared with
that done by private stock or mutual
companies on account of the woaful
lack of interest on the part of r5e
ordinary mortal to secure Insurance
until implore5 to do So by a persist
ent agent, and that. therefore the lib
eral or stock company is a very pc
tent factor in the success of such in
stitutions II the bills recommended
by the insurance Investigating com.
mittee are enacted into law, the re-
port states, there will be no need for
state insurance as the evils of the
present system wul be remedied.
The majority report in part is as
follows.
Your committee offers herewith a
brief statement or arguments for and
against state and governmental insur-
ance, and attached hereto is a sup
Elemental statement describing the
different forms of government tnsur-
ance which have been adopted in
other countries. Life insurance in
its simplest form contempb.tes guar
anteed payments of specific amounts
to the beneficiaries, made possible BY
premium s1Tings contributed by all
the insured within the class.
Under the law of averages the re-
serve required in the insurance bust
ness is mathematically certain. To
this reserve is added by private com.
panies, upon their participating poll
cies, an expense loading amounting to
from 20 per cent to 40 per cent Of the
face of the premium. The smaller
expense loading of from 5 per cent to
20 per cent is added by the comuanies
to non-participating policies for the
same purpose after deducting the
expense of management and an arbi.
trary amount set aside for unassigned
surplus, the remainder of the loading.
together with interest earnings and
mortuary savings, is distributed back
TO participating policy holders or to
stockholders in the form of dividends
From this brief statement OF insur-
ance methods it is apparent that safe
and economical management in secur-
ing business, investing funds, and in
the general conduct of its affairs. are
important factors in the life Insurance
business.
1T has been urged by the advo-
Gates of state insurance that under
appropriate legislation, comforting the
power upon the insurance depart
fent of the state, that department
shall be authorized to issue policies
of life insurance upon such terms as
will mature the policies under the
terms of the contract, and will further
enable the state to enter into active
competition with private companies in
the life insurance business. The fur
Their claim is made that under state
insurance:
list. Every policy would be guar
teed by the state.
"2d. The reserve funds will be in
vested within the state, a.. thereby
mutually benefit the state and policy
holders
sd. Premiums will be less than
those now demanded by private com.
panies
"4th. Greatly reduced expenses in
salaries and management will result
18th. Dividends will be reduced al
nually upon an equitable basis.
18th. All benefits win be distributed
among the policy holders.
nth. Insurance policies will have a
loan value after the first year.
18th. No lapses nor forfeitures viii
occur.
18th. Automatic extension viii be
granted upon failure to pay premi-
ums.
10th. No large initial cost will b.
incurred for agents.
"11th. Policies once issued will be
free from unjust restrictions.
"12. A maximum benefit viii re
suit at minimum cost.
Opponents OF state insurance pre-
sent the claims in opposition:
"1st. That for rhe state to under
take insurance would be the highest
form Of paternalisni. and that it should
refuse to enter into competition with
a business now regulated by private