The state herald., 1908-10-23
How Insurance
=, Is Supervised
in Colorado
THE REPUBLICAN IDEA OF coRPo.
RATION REGULATION PUT
INTO PRACTICE.

amendments. At that time the pres
eht head of the Colorado insurance de-
partment. Mr. Il. Il. Rittenhouse, care.
fully compiled the laws, benefitting by
the experience of the various states in
the Union. and on July !, 1907, the new
model code passed by the legislature
was put into effect.
This law requires the commissioner
TO examine companies TO see that they
are obeying the law and that they are
solvent. 1t authorized him to publish
any information regarding insurance
companies which will be of benefit to
the public.
Insurance Laws Enforced.
The best laws are of no value unless
they are enforced. To enforce laws re.
stricting the privileges of corporations
naturally brings strong opposition from
them. In the enforcement of the insur-
ance laws the companies affected and
the insurance press have from time to
time severely criticised the Colorado
commissioner.
These laws, while entirely fair TO
the corporations were not made to
please them. but to protect the public:
and the Republican administration in
this important department has en-
lessly without regard to whether or not
the laws pleased those who had been
violating them.
An idea may be gained OF the extra.
ordinary efficiency and activity of the
insurance department and of the great
value and protection 1t has been to
the policyholders by noting the follow.
ing facts:
Splendid Record Of Supervision.
During the three years in which the
present commissioner has been In
charge OF the state insurance depart
ment. thirteen insurance companies
have had their licenses revoked or re.
fused. These companies ranged from
<the little assessment fire association
without a capital 10 the big Maryland
Casualty Company. with its millions.
These revocations were all made after
investigation OF the company's affairs.
which showed them either insolvent or
with an impaired capital. or guilty OF
violation of some other insurance law.
Twenty other companies, many OF
thom while under inquiry by the de-
partment, have. during the same per.
iod, ceased doing business or with.
drawn from the state because of i'm.
proper practices. insolvency or failure
TO comply with other laws. OF these
thirty.three companies which have left
the state "for cause as n result OF the
vigorous supervision by the Republi-
can administration, nine were small as.
sessment accident and fire companies
operating without n capital. and which.
with few exceptions. were operat.
ing In an irregular manner.
Irregular Assessment Companies Put
Out.
The agents OF these small companies
would 30 to the small country and
mountain towns OF the state and Sc
cure business largely by mlsrepresen.
tation from class OF people who were
poor and could little afford TO lose their
money. Such companies invariably re.
fused on one excuse or another. to pay
their claims. This class OF companies
has been entirely eliminated.
Seven OF these thirty.thrce compa.
niles were doing large business and
enjoyed n reputation for solycncy and
rcspcctnbility. but the vigilance OF the
Colorado department discovered the
fact that their capital was impaired.
Four companies which were found
with impaired capital. made good the
deficit and were permitted TO remain
In the state.
The following arc some Of the very
important achievements OF tho Colo
rado insurance department which have
attracted Wide attention and very
favorable comment:
Stock Schemes Eliminated.
Tho practice Of tncklng on 10 lie
contracts stock speculative schemes.
md special contracts" wherein fab
uloua dividends or profits were prom.
isod to induce people To tako insur.
anoc. was broken up by the Colorado
department after long fight one OF
the large companies of the East started
an agency OF this kind In Colorado. 10.
lccting prominent men aa directors.
Although operating under the old
defective laws. tho insurance depart
ment succeeded In breaking up the
scheme. and today life insurance Ia con.
ducted In Colorado on clean lcgitl.
mate basis. No falnc estimate or do.
ccption Ia permitted In inducing bust,