The Fargo forum and daily republican. [volume] (Fargo, N.D.) 1894-1957, 1910-04-28
need OF CURLING
The FRATERNALS
PRESIDENT OF INSURANCE COM.
MlssIoNERS' ASSOCIATION
ISSUES STATEMENT RE-
GARDING PROPOSED
STATE REGuLA-
TON. "a

TON.
Chicago, April 28.-The momentous
conference called by Pres, John A.
/ Hartigan of Minnesota of the National
Association of Insurance Commission
ers to consider the state legislation
i proposed by a committee of the assoc
citation has brought together not only
insurance commissioners Of most of
the states but representatives of nearly
all the fraternal insurance societies
of the United States, societies with
over 9,000.0O0,OOO of outstanding GER
tiffcates. Regulation of the fraternals
first proposed by the National Fra
ternal congress which has sought to
get all fraternal insurance put upon
a sound basis by adequate rates. has
been impending for several years.
How the insurance commissioners will
propose to do 1t will be vital to some
5000, 900 members of fraternsl societies
throughout the country.
Concerning his attitude on this sub
ject President Hartigan issued the
following statement which indicates
the views of insurance officials toward
regulations:
| ne buSlL6SS NFdIlbdCI6u DIV these
societies has reached enormous pro-
portions, and the necessity for care
full supervision Is generally admitted
For instance, in my own state at the
end of 1908 the fraternaIs had in force
certificates to the amount of $304,S14,-
600, while the total insurance carried
by the old line or legal reserve COM
panies amounted to $207,767, 900.
i cit Is evident, therefore, that a
large proportion of our people are de-
pending upon fraternal societies for
their protection. In some states these
societies are not under the jurisdiction
of the insurance department, and
many people have been defrauded by
the operations of illegitimate concerns
masquerading under the name of fra
ternal societies.
1.-THE real fraternals have accom-
plished great good in educating the
people to the need Of insurance and in
reducing the expense of carrying this
protection. The membership in these
societies is solicited by the existing
members and the expense of securing
new business is consequently elimin-
mated. other societies secure their
business through the efforts of paid
agents, exactly the same as do the
old line insurance companies. There
is, therefore, no saving on this account
and as the death losses will be the
same in every society, If the same care
is used in selecting risks, these fra
ternals have nothing to offer from the
point of economy.
"The rates charged by many are in
adequate to furnish whole life pro-
lection and the members must look
forward to an increase in these rates
1.-THE investment of the funds of
these societies should be limited by
law to securities of unquestioned
value and the securities representing
the reserve funds should be deposited
with the state.
"It is claimed by some that these
societies. being purely mutual associa-
tons. should not be subject to legis-
Iative restrictions but this same ar
gument would apply to any mutual in
surance company, and the necessity
for legislative control and department
al supervision has been fully estab-
lished. Some societies have always
opposed governmental control of any
kind, but this opposition is now con-
fined to a few societies. The real fra
ternals recognize the necessity of this
control and welcome it as an aid to
their efforts
cit is impossible, in many states, to
pass law that is opposed by the fra
ternal societies, but 1t is the duty of
the commissioners to recommend
proper legislation and to advise the
members of these socie' .es of the ex-
act conditions surrounding their pro-
lection"
(Signed.) John Hartigan
On the matter of state regulation
the fraternal societies split into two
factions two years ago, a majority OF
the societies having favored a uniform
bill drafted by them which, however,
all the insurance commissioners did
not endorse. 1t was foreseen by the
leaders in the fraternal insurance field
that the situation demanded official
attention to prevent disasters to So
cieties which refused to re-rate upon
an adequate basis. They have, there
fore, urged action, and this forsighted-
ness holds promise of great moment.
Because of 1t the situation differs from
that of the national building and loan
association before state supervision in
rottenness of many and precipitated
a crash because the fraternal congress
has declared openly that the advanc-
ing age OF members of ''cheap rate"
societies compels a radical change of
rates to make them meet their obliga-
tons. A. L. Hereford of Springfield
ILL.,, when president of the National
F'raternal congress, in his report said:
ION Dec 81 1906, there were $40 fra
ternal beneficiary societies in the
United States and seventeen in Cam
i ada, which number Is rapidly increas-
ing. These societies range from the
highest degree of responsibility to the
worst kind of fakes. They had nearly
/ 5000, 900 certificates in force, with In
demnity amounting to almost $9,O00,-
600. 900 and their receipts in that year
amounted to more than $4,000, 900.
This vast army of 100000 trusting,
confiding members is marching to old
age and to certain death: the SO, :
600 900 of obligations are rapidly
reaching maturity. The societies that
are operating on inadequate rates of
assessment cannot possibly meet their
obligations, If they continue upon their
present basis, and as a consequence
the time is not far distant when these
societies must go out of existence and
their members be deprived OF promised
protection, and the fraternal benefic-
larry system condemned as the building