The Oskaloosa herald. (Oskaloosa, Mahaska County, Iowa) 1885-1919, 1914-07-02
TO TEST VALIDITY
Of MUTUAL CO.
MAHASKA COUNTY ATTORNEY
BRINGS ACTION IN COURT
CASUALTY CONCERN is ATTACKED
Method OF Doing Business Held to be
Irregular, but Company Claims
They are Proceeding Wholly
Within Their Rights.

Proceedings we're Instituted in Ma |
haska district court this morning by |
County Attorney McCutcheon, in the
name of the state of Iowa, to compel
State auditor J. l.. Bleakley to revoke
or suspend the certificate granted the !
Employers Mutual Casualty Associa. !
ton. of Des Molnes, giving the COM
pany authority to do business within
the state. The county attorney charg-
es in his petition that the insurance
company Is doing business on what
| Is known as the stock plan" and is
thereby violating the law. He claims
that Auditor Bleakley has full knowl'
edge of the facts in the case but has
refused or neglected to revoke the
permit which he formerly issued to
! the company. Mr.. McCutchen fur.
Their sets forth that the relief asked
for is necessary t. protect the PEG
pie of the state and Mahaska County
against fraud.
According to the petition, the con-
Germ Is issuing certain contract of
insurance, by which il undertakes for
d fixed annual premium to pay in
! full all losses sustained by the mem
berS by reason of any payments re-
CURED to be made to any Of their EN-
ployes under the provisions OF the
| WOrkmen'S compensation act.
Charge No Assessments Provided
The allegation Is made that the com
pany agrees in its contracts not to
make any assessments upon its mem.
berS, but that the amount named as
the annual premium shall constitute
the full liability of each member to
the association. 1t is further charged
b that II provides that each member
shall pay the same in full regardless
of the losses required to be paid by
the association to its members in any
one year.
, BY issuing such a policy, McCut
cheon claims, the association has lost
its right to transact business within
the state, and that It Is the duty OF
the state auditor either 10 suspend
or revoke the authority granted it.
; Casualty Company Not Alarmed.
DeS MoineS, June 30.-The Employ.
ers' Mutual Casualty Association,
, which is attacked in Mahaska County
court, was organized several years
ago. Since the passage of the work
| mems compensation act it has become
more active than in the past.
John A. Gum of kellogg is presi
dent of the association. The position
of secretary is held by John A. Eddy.
George Wrightman and Charles A.
Rawson of Des Moines and II. w.
, Spaulding of Grinnell are among the
directors of the company
, Judge Jesse A. Miller, attorney for
the Employers Mutual Casualty as
, sociation, belittled the proposed &C.
ton against the company when he
was told of it.
Il am not surprised that a suit
:, should be brought in one of the out
; side towns" he said
This action evidently is being fos-
tered by a combination of stock com
panies competing with US who have
been hurt by the business we are get.
ting. They employed a man to work
at the state house and tried to block
= Us in the auditors office without sue
2 cess
The state auditor has approved the
L contract they are attacking because
y It is accordance with the law.
The Employers Causalty associa,
D ton Is not stock concern under the
. law as they claim. II is a mutual com
I pany and is doing business in ex
I actly the same way as are dozens OF
q mutual fire and life insurance assoc
) iatiOns.
. How Company Operates.
= The members of the association
n lpay a fixed premium. This goes into
the premium fund. The board of di
rectorS assesses against this fund 10
pay all losses. AT the end of the veal
whatever money is left in premium
d fund after all losses have been paiC
b is returned to the policy holders IL
}. proportion to the premium they have
j paid. There are no assessments be
!. yond the fixed premium because the
5 officers Of tho company have worked
out the amount of premium necessary
on a safe basis.
I The Mahaska county attorney sim
!. ply is misinformed and hasn't investi
gated.
= THE Employers Mutual Casualty
association is operating strictly in
A accordance to law and has met the
( opposition of combination of STOCK
q companies. They will be bringing this
3 action under some old statutes which
9 have been superseded by new insur
Z ance legislation. Their action will no.
0 last long in court"
Cosson VIII Fiuht Case.
Des Moines. June 30.-Following
conference today with Attorney Gen
I eral Cosson. C. s. Byrkit, of the stat,
insurance department. announce,
that Cosson Will represent the stat,
in any proceedings which may b,
brought by stock companies or Attor
ney John McCutchen. of Mahask,
county. revoking or suspending the Il
cense granted the Employers Casu
atty association to do business Il
Iowa. The notice received by Aud
tor Bleakly that a petition would b
iiled today BY Attorney McCutcheu
resulted In the consultation. Tn
state has already approved the cas-