Evening star. [volume] (Washington, D.C.) 1854-1972, 1907-03-07
METHODS TO Be Open
"YeIIoW Dog" in Insurance
Matters Past and Over.
APPEAL FOR FAIRNESS NOW
Policy Of Frankness Rather Than Sub
terranean Procedures.
AN APPEAL TO THE STATES
They Will Be Asked to Remove In
vest4ent Restrictions and
Tax Burdens.
APPEAL FOR FAIRNESS NOW
AN APPEAL TO THE STATES

NEW YORK March 7-Robert Lynn Cox,
secretary and attorney for the newly form
ed Association Of Life Insurance Presi-
dents, started yesterday on a trip to the
capitals of several states to appear before
the insurance committees Of their legisla-
lures In connection with pending legislation.
Mr.. Cox will visit, among other states. Mis-
souri,, Arkansas, Texas and Tennessee. He
Is a former member Of the New York as
sen1bly and was in the Armstrong commit
tee which investigated insurance conditions
In this state a year ago.
Just as the brief submitted to the asso-
citation by ex-President Cleveland on Tues
day concerning one bill In particular that
is pending in several states was the first
step in the campaign Of education that the
organization is undertaking to carry on re-
garding life insurance legislation, SO Mr..
Cox's trip is the first concrete attempt to
present it's views to the legislators them
selves. The results are awaited with q
good deal of interest by the insurance men
who were responsible for forming the assoc
citation.
To Work in the Open.
The primary reason for this Is that the
association, according to its announced pur-
pose will endeavor in future to bring mat
tiers of legislation affecting life insurance
out in the open and substitute complete
publicity for the subterranean methods by
which such things were handled In the days
of Andrew Hamilton and Andrew c. Fields.
Under the new plan Of procedure 1t Is left
to the policyholders Of the states them
selves to enforce the enactment of their
conclusions upon the legislators as the re-
suit of such information as they may be
able to obtain. If the system succeeds. 1t
will mean of course, complete revolution
in legislative methods, which might reason
ably be expected to be followed by other
large corporate interests besides the life
insurance companies. If 1t fails, the COM
panieS will face still another problem.
Mr.. Cox's present trip relates to seVeral
measures pending in each of the leglsia-
lures that he will visit. One of these is the
bill requiring that 20 per cent of the re-
serves maintained against the policies writ
ten by outside insurance companies IN any
given state shall be invested in the securl-
ties of that state. 1t was on TINS Dill tnat
Mr. Clevelands opinion was submitted, IN
which the eX-President and present counsel
for the association held that insurance
companies should not properly be required
to conform to such measure, and ad-
vanced among other arguments the one
that comfy between states ought to bring
about the acceptance of the reserve stand
ards and requirements of the state OF IN
corporation by other states in which us
companies did business
An Unnecessary Burden.
The same argument will be used against
another bill pending in several legislatures
which seeks to require the insurance COM
NAMES of other states to maintain speci-
fled deposits in the states in question. In
favor of this bill has been urged the fact
that the governments of France and oher
European countries have required that for
eign companies should maintain certain de-
posits there, but Mr.. Cox will contend that
the situation between nations is not the
same as that between states, and that 1t
would put the insurance companies to need
less expense as we'll as inconvenience TO
require special deposits with the insurance
departments of outside states without pro-
ducing any additional element OF safety TO
life insurance funds.
Against both bills there will be used the
argument that while the first considera-
ton of life insurance investment is safety,
the second is to earn as great return as
possible for the policyholders, and that any
hampering of the companies properly TO IN
vest their funds in the best market avail
able at any and all times is detriment
to the policyholders themselves.
A member of the executive committee of
the Association of Life Insurance Presidents
said yesterday that neither Mr. Cox nor
the association in general would oppose any
of the statutes proposed in other states
which are based upon the Armstrong COM
mittees legislation here. The position of
the association, said this authority, will be
that while some of the individual companies
in the associations membership have found
objections against some of the Armstrong
committeeS acts, the association as an or
ganiZation proposes to see that the laws get
fair trial wherever hey may be enacted.
If, after trial. tangible faults appear which
l,, tod hno III c "a
cia ton will proceed openly for their amend
ment.
Heavy Tax Burden.
1t was learned yesterday that one matter
which the association will take up at an
early date is that of insurance taxes. The
companies have complained bitterly of the
increases in taxation under which they have
been placed by the different states from year
to year. They now have a concrete state
ment of their situation in figures compiled
by President ]. NJ Taylor of the Connect
cut Mutual Life Insurance Company. Mr.
Taylor found that the forty-one insurance
companies making reports to the state de-
partment of New York in 1903 paid in that
year $50, al, 7O1 in dividends to policyholders
and paid $9,212, 334 in taxes to the various
states where they did business, or 2577 per
cent of their total dividend payments.
Deducting the amount paid in taxes on
real estate, there remained $1,2O2, 217 of in
surance taxes alone. 1t appears also that
the profits of the Ohio state insurance de-
partment for last year We're in excess of
$500, 900 and that those of the New York
state department exceeded 500, 900, which
fact moved State Superintendent Otto KEEL
sey in his annual report to suggest that
the charges against the companies should
be abated in some way, even If the entire
scheme of insurance taxation were not re-
vsed. The contention of the Association of
Life Insurance Presidents will be that tax
on insurance companies is a tax on thrift,
and that in the last analysis it is the policy
holders in the state imposing the tax who
have to bear its burdens.