The sun. [volume] (New York [N.Y.]) 1833-1916, 1910-10-10
INSURANCE PROMOTION co.
DEP iRTHENT REFLECTS ON
THE UNITED or ARIZONA.
says mat the Cost Of selling the Com.
pany's stock HAS Been 81 ~ for
ENrry ~ share and That Of - S8,O OO
Taken On SIS. 900 In aash Remain

tn. New York Insurance Department
has given ont a Statement regarding a
recent examination INTO the AFFAIRS Of
IA. United Insurance Company Of Ar
yona aud its proposed subsidiary. the
United Fir" Insurance Company " New
York The former company has Offices
az lU William street. III" latter com
pany was Incorporated under the New
York law m November. 1899. with a Capi-
tai stock 81 S2,O UDu. hut non" of the cApi-
tai has been pa'd IN and no steps have
l.s'n taken looking 10 the lightning of
business
Tn" United Insurance Company OF
Arizona ~" statement describes a. "a
promotion company organized under
the laws 81 Arizona IN December. IgiS
with capital stucA 90 IN ,Jn uID shares
Of par value Of 81 each The statement
SAYS that although iuO 40 shares Of thus
wis subscribed for hy one q l. Van
lAuiugham and his a~sociat--. no shares
have b..,.n issued IN the allotment Inc
drntaliy tn" statement mentions that
the company home stat. of Arizona
II not mentioned ~ lt- seal. stock ceTtItl-
Gates or literature. the words New York
Chicago being used instead and that
only i've of the seven directors ar" stock
holders
Van l.aningham, the report saws has
achieved considerable nu'orIrty 80 pro
moter - other companies. including 'he
stat" Agency Company "a connection
with tn" Indiana Life Insurance Company.
the l.if" Underwriters Agency Company
IN Colorado. the Great Western Life In
ruranCs Company Of Kansas CITY and
III" Consolidated Casualty Company Of
West Virginia. with headquarters ia
chicago. The two agency companies
went into TeCeiverships. MANY Of Van
lanlnghams assoClate- ia the United
Insurance Company II Arizona. the re-
port saws. had been associated with him
before
Van Ianngh1m Withdrew from the
Eureka Company On November I. 1919.
and its management devoiy"d upon
Ferris T.. shaw. now 10 acting president
Paul =. knowles and Stewart Gootrell
The books Of the company show that
Van laning CHAM was paid more than
SIS no al the time 81 his retirement
about half ~ II being in certificates ~
stock ~ the company ~ the present
mana cement the report says II would
appear that the present mana cement
really had IN mind the ultimate formation
~ an insurance company. which would
he mana grd by the present Officers ~
the United and that they the present
managers are not merely promoters
tn" Sales ~ stock wsrs made through
agents az "A commission of IS per cent
4 system 81 advances increased the out
lay. The promoters used the unit
plan u placing rh"lr stock. selling To- a
physician. a lawyer, banker and an
insurance agent IA each considerable .
city or town with 'he understanding
that each would he the sol,. repressnta-
NV" IA the community II one II the ma
suranCe companies Ia bs fnrmsd a life .
insurance company a lire Insurance. COM
pany. marine insurance company and a
casualty insurance company. IN" present
mana cement. according to the statement
paid for their small holdings ~ stock IN
notes. which are sti!l Outstanding
The Insurance Department examiners
found that the cost Of selling the com
panys stock has teen 2G2 per cent or
s. - for each 81 share sold The total
rec-i pts from stock safes. including Sas ~
IA notes still on hand the report gives ~
round figures kSt5 ussD. actual cash
received. sl76.IDO with disbursements.
tlSs.O1D bringing the present cash asset.
down 20 tisUB
Mr. shaw and Mr. GoodrelI. the acting
president and secretary Of the company
Issued yesterday a statement Answering
that gwen out by III. Insurance Depart
ment, m which they say that the Si5D1
paid to Van lanlngham on ms with
drawal from the company was IA return
for cash advanced and was legally due
HIN. The stock salesman feature which
the examiners CrItlCIS. has built up tn.
present officers say. an agency organiza
ton OF approximately ~ agencies IN .,
forty-two States. all ready to sell ins,Ir-
anCe as soon ~ IN" orRanization - Nom-
pl"ted BESIDES over 200 bankers m
the several States IA" reply says. are in
terestsd as stockholders and ar. ready
10 cooperate 4 conservative estimate
u TIA" cost II securing these agencies
the reply says, would he at least sy1.OsU
and should hs charged To underwriting
EXPENSE aud not 10 organization cost
| he expense ~ publicity also has entered
tn Il -
the officers statement says
The reply adds That after an examination
VI the company AFFAIRS extending over
i've weeks -th" Superintendent ~ lnsur-
ance ~ unable To point TO the issuance 81
a -iuRl. share 81 WdteT.d bonus or pro-
notion stock, or ~ one dollar OF graft or
nIsappilCdtIou 81 funds