The Bennington evening banner. (Bennington, Vt.) 19??-1961, 1914-05-28
DsAvrrr GIVES HIS SIDE OF
BOND CONTROVERSY
CONTINUED from First Parel

AtIAtf ACNrlAA 70 me NNNtA-t- = -
der date Of aJnuary rs he renewed
his request and stated that II did
not comply with his request within
ten DAYS he should assume that ! de-
clined TO do so. and for the FIRST time
! learned that he claimed that ] had
failed 10 make disclosure Of a mater
ial fact which Nos that the three OF
the four relnsuring companies were
not admitted 20 DO an insurance bust
ness In the state AZ the time thel
we're accepted as sureiies on my bond.
And In that connection be stated that
he would not have accepted them had
he known the facts. AS cOurteously
as ! knew how ] denied that I had iri-
ed 70 suppress information. and sug-
gested that our law did not require
reinsuring companies to be admitted
20 do business In the state. that their
obligations were contracts OF indem-
nifty and not OF insurance. we're 50
treated by our Law. and so recognized
by other states But ! told him in my
reply that I would try TO bring about
their admission so that the situation
might be exactly as he said he sup
posed il 10 be when he approved my
bond. Since that time two OF the re-
insuring companies have been admit
ted 10 the state and as the third CON-
pany which is indemnifying the Amer
lean Fidelity Company 10 the extent
OF $4,000 has declined TO apply for ad
mission have asked the American
to protect the state by having a COM
pany admitted to the state secure the
performance OF this $4,000 undertake
/ ing. When that is done the situation
/ will be as Governor Fletcher states
he supposed II was so far as the rein
surfing companies are concerned,
when he approved the bond.
In subsequent correspondence !
gave Governor Fletcher information
which he had requested concerning
the American Fidelity Company. and
he had been in close touch with the
commissioners continuously from July
1918. and I informed him that ] desir-
ed TO comply with all lawful requests
coming from himself as Governor
and so had asked the Attorney Gener
al for an opinion touching my duties
in the matter The Attorney General
replied that the jurisdiction OF the
Governor over my bond had ceased
when he approved it and thereafter no
official or board had any control over
il. and the Attorney General so advis
ed the Governor upon the latter's re
quest for an opinion.
Had there been any real occasion
for any change in the bond | would
have procured further security 10 the
state but as the commissioners in Jan
uary. 1914. found the American Fidel
ity Company solvent and that It was
conducting it's business at that time
in a way to maintain a continuing-con
dition OF solyency there was no rea.
son for change The Company
April 80. 1914. had assets OF nearly
S1,2OO,000. and a surplus as 10 policy
holders of more than S4500O0. which
means that after setting aside assets
sufficient to meet all liabilities OF ev
cry kind there remains an unimpai-e ed
capital of $3S0.75O and funds in addi
ton of $93.lS420, making S473, 93i.2t
with which to meet any extraordi
nary losses which may occur. While
the company is not as large as form
erly It is now financially sounder than
at any previous time in its history
barring possibly the first few years
OF its existence
Our law provides that foreign sur
ETY. company coming into this state
for business must have an unimpair
ed capital of 100000. It will thus b,
seen that the American Fidelity Com
pany. the only Vermont company en-
gagged in this line OF business has
nearly double the requirements for
foreign companies. This company is
also doing business in Massachu
sets, Connecticut New York ant
more than twenty other states. where
the strictest supervision is exercised
over such companies and where the
highest standards OF solvency prevail
For more than seven and a half years
as one of the insurance commission
ers of this state have had know
ledge of this company's affairs. The
Company in December last ceased wri
ing policies insuring employer.
, against accidents to their employee:
and thus has eliminated hazardous
and undesirable branch of business
and 1t is now carrying on business il
: way which should ensure a contin
uing condition of solvency and tn,
! company is entitled to and has conf
dence Of the insuring public of this
state and also of other states.
| have nothing further 10 say a
this time but the foregoing facts car
be verified by the official correspon
dence which is rather TOO voluminou.