New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1910-10-10
Superintendent Asserts That go
Per Cent of Cash Taken In
Was Paid for Expenses.
ALL SURPLUS DISSIPAIED
Finds It's Business Confined TO
Selling Stock in Promotion
Company and Statesmen
Paid on Liberal Scale.
nv Telegraph 20 Tho tribune

s~onnany OF Arizona. with ITS prol'700
<,bsidiarv. the United Fire 1hS''i <ai''0
r-omuanv Of New York. is the hrs' COM
,-- 20 receive the fire of Superih-
+o,6a1. aotchkiss Of the state insurance
roo,,,,+v,ant 1lnder the amendment 10
no Insurance law that went into erect
I'll giving the Insurance Depart
mont che right to investigate coi
lions formed TO promote insurance ooiii-
panies. r
The United Insurance company
Arizona is the promotion company anu
has an office at No. 100 William street.
-. York The United Fire Insurance
,.,.,-,-,arz, Of New York is the only SUD-
.5is.,- ,-at organized. but according 10
rbe literature OF the promotion company
thora are 20 be three other subsidiaries
cssual,,. a marine and a life com
many Tho fire company WAS oTEan'zou
:, ,lo~c-,bo-. 1909. with an authorized
initial stock Of 500 600. but none Of the
.api,al has been paid in and it has not
-, an, stems toward beginning bust
ness
n, e,r,Ius and Little Capital
To ,,,.. present time the business has
,,re, confined to selling stock in the pro
r,,.son company. which seems. accord
ir 90 tho report Of the Insurance De
nzr+me-,,. 10 have been chiefly profltaol
"a the eslnenen and officers OF the com
rs1.--. az a. per cent Of the cash taken
IN VAS paid out in expenses. The Insult
snoe Department SAYS Of this
Tine above showing suggests grave
doubt a. 10 whether this company. even
et = considerable reduction from its pres
chi rate Of expenditure. viii ultimately
acquire sufficient funds ia permit II TO
finance life Insurance company, q hre
insurance company. marine insurance
company and casualty insurance COM
many. In fact. the cash received. name
IL SIG coo having been reduced by pro-
motion expenses 10 only $4,000 il ap-
y,os-s that this company has thus far
disyips4ed ali az its surplus and nearly
-v-o- thirds Of its cash capital ~ the
hearing on this report lis present man
s-ers admitted that unless it could IN
serest large capitalists and through them
sell large blocks Of stock its plan Was
failure and it must proceed to lqul-
date"
The figures given in the report for inc
business Of the company Up TO July l.
1910. show that the total receipts from
stock sales amounted TO $4,000 but as
this included about S6S.G00 in notes stiil
on hand the cash received for stock
amounted to $4,000. while the cash
disbursed for commissions. salaries and
exreuses amounted 70 S1jSec9, leaving
ZrG
Large Sums Paid Statesmen.
The expense sheet shows among its
i-on,s. Salaries of salesmen, S5o.9Gf 81
advances to statesmen. S%S.641 SO: com
missions TO statesmen. S10.940 Ia. travel
ling expenses Of statesmen. Sl0.l,2 ~;
salaries of officers, S13,7:.0: travelling ex-
pen~os IF officers. 81 $50 A; salaries Of
clerks. 81 $50 0S
The United Insurance Company. Of Ari-
zona. II appears, was chartered und"r
tho laws Of Arizona in December, 1908,
with an authorized capital stock Of To-
100000 shares. Of the par value Of 81
each. O. L. Van I.aningham, who was
until November 1909, president of the
COMPANY. and his associates subscribed
for 100000 shares prior to the organza-
ton Of the company, but the Insurance
Departments report says that no shares
have been issued on the subscriptions
and no call has been issued for the sub
.criiors to take MP their aIlotments.
Van Laningham has been concerned in
.=evoral other companies. some of which
went into the hands Of receivers. He
vas first known as the organizer Of the
state Agency Company. which was to be
general agent in Indiana for the Indiana
Life Insurance Company After a large
amount of stock in the agency company
had been sold. Van Laningham left 1t
and organized the Life Underwriters
Agency Company, in Colorado The plan
IN both these companies was to sell stock
IL the agency company with a life in
surance policy. and both went into the
hands Of receivers.
The next promotion Of Van LaninGham
VAS the Great Western Life Insurance
company. Of Kansas City. Mo- which
~ont into the hands Of receiver and
had 10 he recognized. He then helped
promote the Casualty Company Of West
Virginia. with headquarters in Chicago.
= large part Of the money collected in
the promotion OF this company was dis
sipated and the company had 10 reduce
its capital stock
Locked for S4o,ooo,OO0 Surplus.
The plan Of the United Insurance Com
uany was TO sell its stock at - a share
80 representatives, in each considera bic
village and city in the country, with
whom contracts were signed. making
them in their localities the representa-
tives Of the insurance companies TO Ice
organized as subsidiaries TO the promo
ton company. The literature stated that
when the capital stock fully sub
scribed the company would have d sur
plus Of S80.eo0oy0.
Van birmingham got out oI the COM
many on November I, 1909. on the pay
inent 10 him Of S15.219 Il, charged as
cash advanced and disbursements made
for TIE company. OF this amount S1.6So
was represented by stock in the com
pany. After the settlement, on Novem-
ber I. Van I-sningham got 1885, 81 in
cash on November ., 1910, and 500 on
December - following. on May Ia.
1910. he received $1,000 for services
1000 tho ror.,-