The Telegraph-courier. [volume] (Kenosha, Wis.) 1888-1946, 1912-10-17
State Insurance Department
Issues Statement in Re
gard to Bankers Life.
kENOSHAns ARE INTERESTED

several hundred kenosha pel1cyh0ld-
ers in the Bankers Association of Des
Moines, Ia, and the Bankers Life
Company, have no cause for alarm at
the receivership suit which has been
brought in Indianapolis for the pos
session and control of $18,000,000 as
sets, according to statement issued
by State Insurance Commissioner H.
L. Ekern today. Mr.. Ekern's EXPOSE
tion Of the case will be Of interest.
e'The newspapers report Of suit
against the Bankers Life Company,
formerly the Bankers Life Association
of Des Moines, Ia, have brought num-
erous inquiries to this department. in
regard to the change by this company
plan Of writing its new business only
upon the legal reserve basis, and as to
the effect Of this change upon the
rights Of holders of the old assessment
Contracts states Insurance Commits
sioner Herman L. Ekern today "This
association was organized to do an in.
surance business on practically the
current cost assessment plan. This
plan works well enough during the
first ten Of twenty or even thirty years,
while practically all the members are
where the current costs Of insurance
per year per $1,000 range from 1871
at age twenty to $13.78 at age fifty.
But the plan becomes grossly inequit-
able and ultimately impossible when
any considerable number of members
reach the higher ages, where the costs
of insurance per year per $1,000 range
from $26.69 at age sixty to 5000 at
age seventy and $114.47 at age eighty.
These are so grossly disproportionate
to the costs of the members between
twenty and fifty that on any plan
which does not assess to each member
his own costs the younger members
soon object and discontinue and others
refuse to come in, leaving the old
members. This association was reach
ing the time when this increased cost
would soon be felt.
"In October, 1911, it changed it's
plan to provide that contracts there
after should only be issued on the le-
gal reserve plan. The new plan pro-
vides for safeguarding the rights of
the old members by requiring that their
reserves and guarantee funds and
earnings shall be held exclusively for
their benefit and paid out only accord
ing to the terms of their certificates.
.The new plan further provides that
the old members may surrender their
certificates and transfer to the new
plan on such terms as may be provid-
ed by the board Of directors. The only
oii0ioisLh WHEEL las D00u sAau6 TO JnIS
department. has been that the amount
allowed to the old members on a trans
fer of their certificates to the plan is
too small. A report of an examination
made by the Iowa department. at the
time of the adoption of the new plan
shows that the records and accounts
and assets of the association were
found to be correct and to correspond
with their annual statements.
1.-THE old assessment contracts will
probably be good and reasonably cheap
insurance for temporary protection for
the next few years only. However, be-
ing on the assessment plan, they can
not guarantee satisfactory insurance in
the long run. The company was Ii
censed on the new plan subject to an
examination which it is the expecta-
ton of this department to make in
the near future, and at that time to
60 into the question of the rights of
the old members as between them
selves and in case of transfer.
"The newspaper reports indicate
that the suit brought is for an ac-
counting and to raise some question in
regard to the adoption Of the new plan
by the company. The fact Of the bring
ing Of this suit need cause no anxiety
to either the old members or the new
policy holders.
ANNIVERSARY CELEBRATION.