Newark evening star and Newark advertiser. [volume] (Newark, N.J.) 1909-1916, 1913-02-10

has been done the policyholders in
connection Herewith. Furthermore,
he ignores the fact that the chaneel-
Ior, under the provisions of law, ap-
points three representatives of the
| policyholders to serve as members of
the board of directors. whose duty it
Is to safeguard the policyholders' in
| terests in all the affairs of the COM
pany. Every apportionment made Of
these funds has received the approval
OF these directors.
Before an apportionment is made
| from the surplus earnings of the
company to this fund as the prop
erty of the deferred dividend policy
! holders, the amount of such surplus
| to which they are entitled is inyesti-
gated by committee of the board of
directors. Colonel Edwin A. Stevens,
one of the policyholders' directors, is
member of that committee. l have
called his attention to Mr.. Nugent's
criticism and requested him to advise
me in connection herewith, which he
has done as follows:
II understand that some question has
been raised in connection with the advo-
cacy OF Assembly Dill NO. 81, now Deua-
ing before the New Jersey Legislature. as
to the apportionment made from the sur
plus earnings of the company to its de-
ferred dividend policy holders.
directors appointed by the chancellor to
represent the policy holders thereon, L
have served as a member of the commit
tee charged with making such apportion-
ment. | am, therefore, entirely con-
versant with the annual appointments
which have been made to the deferred
dividend policy holders. l am satisfied
that such division was made in a way
which gave to the deferred dividend
policy holders, as n separate class, the
amount of surplus to which they were
entitled, and that such appertionment as
made fully protects the interest of the
deferred dividend policy holders In such
fund.
an making such apportionment the
purpose of the committee was to deter
mine the amount of surplus which justly
and equitably belonged to these policy
holders, and which must be eventually
returned to them; il the company was
to meet the obligation assumed by its
policy contracts
"The committee, In making their an
nual appointments, have given consid-
Grafton to the fact that, for the protec-
ton of the company's business, the entire
earnings could not with safety be APP
portioned but have taken into constdera-
ton in estimating the returns made to
these policyholders the entire earnings
on this class of business, and have based
the dividends thereon. When the general
surplus of the company will be sufficient,
the entire earnings Will be apportioned.,
and when apportioned, win be dis
tributed to the policy holders. In the
meanwhile, as representative of the
policy holders, appointed under authority
Of law for the purpose of guarding their
interests / have no hesitation in stating
that believe that the interest of such
policy holders in the surplus earnings of
the. company has been adequately pro-
tected. and that those whose contracts
have reached the period emitting them to
deferred dividends have received the full
amount to which they are justly and
~ have examined the provisions of As
sembly bill No. 81, now pending in the
New Jersey Legislature The, enactment
the deferred dividend policy holders to- a
direct heavy burden by the imposition of
a tax upon their funds.
I'm my opinion, it would be, especially
unjust to all those policy holders living
outside of Newark to place this extra
tax upon their funds for the sole benefit
Of that city. A VERY trSly yosuTTsS; vpNs
"This statement of Colonel Ste
vens, who is not a stakeholder in the
company, and whose only interest. is
the protection of the policyholders,
of whom he is one, will, / think. be
accepted as conclusive on this point.
Having devoted three quarters of
his argument to the claim that the
policyholders will not be affected by
the passage of this bill, Mr.. Nugent
concludes by giving as a final argu-
ment in favor of the passage of the
bill the statement that if the whole
of the tax is charged against the fund
and paid by the policyholders the loss
to such policyholders will be about
ten cents each.
II do not think that the proposition
that this tax will be paid in large
proportion by contributions of ten
cents each from the toilers of America
will aid the passage of the bill.
81 have never before heard adj
vanced the argument that conflsca-
ton was justified because the amount
confiscated was trifling."