The Detroit times. [volume] (Detroit, Mich.) 1903-1920, 1908-03-27

reserve Their reliability. therefore.
depends upon the payment by their
members OF whatever assessments are
necessary to enable them TO pay their
lpsses or expenses. These assessments
may be increased. either IN number, or
amount. whenever the society deems
The officers OF the National Protec-
tive Legion have frankly admitted TO
me and TO other insurance department.
IS called 'dividends. (Which were in no
sense dividends. inssmueh as they did
not represent the increment OF invested
fnndsl from earnings but that they
were enabled TO make such payments
TO holders Of maturing coupons only by
using for that purpose contributions OF
new members whose coupons were 10
mature In the future.
Barred From Some States.
Commissioner Barry also is quoted
as saying that the present assets OF
the company are but small proper
tion OF what has been paid In by the
present membership. He added that
the states OF Ohio. Wisconsin. Virginia
and Minnesota have either refused
this society admittance, or declined to
renew certificates OF authority previ-
ously issued. Illinois has directed the
society to cease writing class B con-
igan took the lead In refusing TO re-
new the society's certificate of author.
ity ON the ground that the business
represented By class b contracts
which constituted the bulk OF the So
ciety's business--was not permitted by
the maternal beneficiary law OF the
state. The law was amended aud IL
resumed the writing.
Otto Kelsey. superintendent OF In.
surance for New York state. says the
association has no deposit with his
department. that ii has no standard
OF solvency and that the contract Is
sued by IL does not guarantee the
payment OF stated sum at the end
of 1ve-year period. or any definite
period or membership.
Supt. Kelsey furnishes the report
on the financial standing OF the legion,
given at the head of this article, as
It was flied in the Bfape of state
1907, and further says:
The National Protective legion 10
operating as an assessment fraternai
beneficiary order, subject 20 the pro-
visions OF the insurance law. IL Is one
Of three organizations which acquired
members at the end OF a fve-year con-
tinuous period OF membership. This
right to pay what Is generally known
and understood TO be endowment bene-
fits was incorporated In the fraternal
law at the time OF the codification OF
the Insurance laws OF 1902. 1892. The
department was opposed 10 this pro
vision OF the law and the amendment
OF 1903. chapter 49, eliminating from
Article VII, the right 10 incorporate
further orders OF this character. was
passed upon its Recommendation
For your information. | wish to state
that this department has continually
criticised the faulty and imperfect plan
which was in vogue relative to the pay
ment OF certain lump sums OF money
at the end OF hye-year period Of
membership regardle$ OF an exact
mathematical calculation as 10 earn
lngs, sccumulations, lapses.. etc. and
has advised the public generally and
the management OF the association that,
In the opinion OF the department, the
would be more than apt 10 meet with
1 financial disaster"
This has resulted. together with other
its convention held in September, 1901.
an amendment to the byIaWs which
| becafne effective Jan. I last. whereby
been changed. SO that after ,ie'e eSeous
tive board meets In January In each
year. and after an accurate audit has
there there shall be apportioned ~" 70 hold, hold.
ers OF certificates In Cqass ri issued
llhve years previous thereto, such
amounts by way OF dividends as are oh
lteined by mathematical calculations to
be due members holding such certIfi-
Gates to be arrived at by the determine
ton OF excess Accommodations arising
1 from certificates upon which payment
a. 10 be made.
supt. Kelsey adds that he believes
this plan will work for more stability.
From several different sources.
t?mong them being M. o. Rowland.
deputy Insurance commissioner OF
michigan. II is ascertained that by
THE calculation called for by the
1smended bylaws OF the order for the
determination OF 1908 dividends. pay
Imenfs can be made 10 the holders of
maturing coupons In 1905 10 the
lpmount OF sf1s.5s on each certificate.
such certificates hitherto paid sZ51---