The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1911-02-14
AN INSURANCE ACT
BEFORE THE HOUSE
Would Compel Fraternal In
surance Companies to Be
Examined by State.
(American News Service)

Indianapolis. Feb. 14-Over 200, 900
men of Indiana are interested in Il
bill now before the house committee
on insurance introduced by Represen-
tative Noris. The bill would compel
fraternal insurance companies to be
subjected to examination by the state
insurance commissioner and TO charge
sufficient rates to care for their loss
es and provide a reserve fund.
The bill is being publicly praised by
the officers of the various fraternal
insurance societies of Indiana as Il
good bill, while ''on the quiet" they
are stirring up opposition to it, be-
cause the condition of their compan-
les will not permit of examination.
In Indiana alone there are over 900
600 policy holders in fraternal orders
and they carry $35O,000,000 insurance.
Insurance experts and commissioners
say the fraternals have not over one
third enough money in reserve to
meet the claims and that within five
years there is sure to be a terrific
crash in fraternal insurance circles
unless these societies raise their rates
and provide reserve funds.
One large fraternal insurance COM
pany doing an enormous business in
Indiana has one and a half billion OF
insurance written and not over $780,,
900 reserve. 1t is said to be certain
that men who have paid into these
companies for years will suffer a loss
of two-thirds to three-fourths of their
policies within the next six years un.
less present conditions are radically
modified. The only fraternal society
which will permit the insurance actu-
airy of the state auditors office to in
spect its financial condition, reserve
funds, assets, etc, is the insurance
department of the Knights Of Pythias.
Goodrich is For it.
Incidently James P. Goodrich, .attor-
ney for the insurance department of
the knights of Pythfas, was the only
one representing the fraternal insur-
ance companies Of Indiana who ap-
peared before the insurance commit
tee and advocated the passage Of THE
bill. Mr.. Goodrich frankly told the
committee that legislation provided
in the bill is necessary in Indiana to
prevent the collapse of every fraternal
society doing an insurance business.
The bill which Mr.. Goodrich advo-
Gated and which Rep. Vorris introduc-
ed is a uniform bill which has been
presented to the legislatures of eigh
teen other states. 1t was adopted at
the national convention of insurance
commissioners and officers of frater
nal insurance societies held at Mobile
Ala. September IS, 1910, after a long
conference.
The agitation started in New York
state where, since the investigation
under Hughes of the old line com
panies, the insurance laws are very
strict 1t was there learned that the
finances and resources of several OF
the fraternal companies were in a
bad way, SO bad in fact that within a
short time a crash is inevitable that
will cause the loss of millions to the
holders of fraternal policies.
BY correspondence and investigation
it was found the condition was gener
al and SO the Mobile convention OF
| insurance commissioners of the vari
| Gus states was called, at which the
officers of the various fraternal so
cieties were present. Admissions
were there made of the condition OF
the fraternal societies and a bill en-