New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1906-02-23

At the very beginning of its report the COM
mission advises the abolishing OF assessment or
cooperative companies. and advises that mutual
life insurance companies without capital stock
be formed. On these subjects the report says:
Under existing law a mutual life insurance cor
poration without capital stock cannot be organized
save for the purpose Of transactins business upon
so-calIed Stipulated premium plan or as fra
ternal society. In other words, Article II of the
insurance law. under which life insurance corpora
tons transact business upon the ordinary level
stock Prior TO 1S4s the business of insurance had
under special acts
We have in this State. exclusive of assessment
companies created by special act, mutual life in
ArticIe Tf tbEoe sGoJecI 10 the provisions OF
poTeuons either formed under the present insur-
eTal provision or plan for the organization OF
mutual level premium companies
II would appear to be anomaly in the law that
mIe insurance cooperation may be formed upon
operative assessment concern without ade6uste
reserves, while mutual company is not permit ed
serve through proper valuation OF its risks may
Without going far as to prohibit the further
organization OF stock corporations. it would seem
20 De wise not 10 prohibit. but rather to encour-
Jun legai reserve basis, provided suitable guaran-
the enterprise. VI
MUTUAL COMPANIES WITHOUT CAPITAL
STOCK
Inc committee therefore recommends that Ar.toIa
A OF lhe insurance law be amended as To mar
mn the formation hereunder OF mutual cornora
Hos without capital stock transact the business
ne Insurance ana for such other purposes as are
auuloilZeu 10 be connected therewtf in the $50 -
,oeA corporations; provided that at least five hun
oieu persons nave subscribed in writing tn become
members therein In the aggregate amonr, ~ nS
80, sLVV1vO 10 be insured upon their lives and
olaLi nave each paid In full annual premium jn
NgSa upon the insurance subscribed for and nro-
IuTIher, that II shall make the me dendstts
win the superintendent of Insurance thar sre re-
Sa.Ieu OF STOCK corporations formed for simiiar
~ poses- A company thus organized will nrrvi5a
az ue security that is afforded on the Formation
oL STOCK corporation and a much sreater oss,Sr
ance or success through the member,bin ntth
which II begins business "''h
/ Section 200, permitting the incorporation q,
companies upon the CO. operative or assessment
P'an' should be amended SO as not to permit such
companies to be incorporated in the future. and
I0re'sn companies of this sort not sIreadv
"anssefins business in this State should not b.
permitted to enter the State
100, LOG frequently they invite disaster by Offering
lsuIahce below its actual cost and jnAict dis
ppSll.sneht ana serious loss upon those nho have
l--NSu ih an attractive scheme cheaD insur-
DrbIh az arc unable 10 pay the readjusted rates
"a ei'e course or time must inevitably be de-
=, While on account of the serfous inturv which
LtnSLeDy might be inflicted upon Innocent policy
me committee is not prepared TO recon-
memo that existing domestic assessment or co
operative corporations should be prohfbited from
continuing their business. and that foreign COM
panles heretofore admitted to transact busjness
Althin the STATE upon this basis should be debarred
IasfsirauA Sst NE committee u decidedly " the