The herald and news. [volume] (Newberry S.C.) 1903-1937, 1915-03-26
URGES GOVERNOR
NOT TO SIGN ACT
TAX COMMISSION CHAIRMAN
on INSURANCE BILL
Insists Measure Is For the Benefit
of Agents Only-Embarrasses
the State.

of certain classes of insurance and TO
provide for the division of commits
sions. Chairman Jones believes thar
the approval of the act 'will prevent
the State securing savings upon the
insurance premiums paid by it for
fire insurance if any one undertakes to
enforce the provisions of this act.
The letter of the Chairman to the
governor is in part as follows:
81 note that the commissioner OF
q insurance stated that the act in
his opinion does not apply to the con-
tracts of reinsurance and mas under
taken to distinguish such contracts as
made by tie sinking fund commission
from the contracts of insurance refer
red to in the act. The distinction at
d tempted to be made is both ingenious
and specious, but would not, in my
opinion, prevail in the courts.
4 "The act is very general in its terms,
and covers all contracts OF fire in
surance covering any risk or on prop
erty located in the State of South Car
olina written by any company Wh1cn
may be doing business. through agents
in TIE State of South Carolina, without
distinguishing between original con-
tracts of insurance and secondary or
collateral contracts or reinsurance,
tae term'insurance' being broad enough
to include both kinds of contracts.
The act itself says: 1t shall be un-
lawful for any insurance company DO
ing business through agents in the
State of South Carolina to write any
fire Insurance covering any risk
or on property located in the State
of South Carolina except through or
by duly authorized agents residing and
doing business in the State
1T further provides that agents who
may sign or insurance companies VINO
may caus to be signed any policy
or indemnity contract (the term any
policy or indemnity contract certainly
includes contracts of reinsurance and
fails to collect the full premium OF
such insurance and retain the proper
commission whie3 is due such agent
NAV have their license revoked as the
penalty for aiding in an evasion OF
the law The proper commissions
are defined abcge in the act as the
same commissions on sucn business
as the company allows them on other
business of tie same class The pro-
vision in the act at the end Of section
/. allowing agents residing IN the
State to divide their commission with
other agents or brokers, instead OF
operating in favor Of the insurer or
the public, is intended still further to
destroy the freedom of contract and
prevents the opportunity OF competl-
ton as to rate and commission to De
paid by the State in placing its IN
surance risks. In same way 1t de-
stroys competition as to the premiums
paid by the State and county upon
bonds of public officials.
''The entire act shows that it was
carefully and adroit,y drawn in the
interest of a special class of citizens
( of South Carolina, to wit: insurance
agents, and against the interest OF the
masses of the people who seek insur-
ance upon their property, and is most
undemocratic in attempting to secure
special privileges and levy special,
though indirect, tax on insurance for
the benefit of insurance agents; II
tends to foster a growing trust and
monopoly, and destroys the freedom
of competition between insurance com
panies for the patronage of the State
and the public seeking to secure in
surance upon their property. AS a
dispenser once said, Whose bread l
eat his song I sing, and this sentiment
may account for the efforts of insur-
} ance agents to require the payment OF
D the full premiums and commissions
which are or may be from time to
time fixed by the insurance companies
in combination with each other.
st am satisfied that the general as
sembly did not notice the broad and
E~sweeping terms of this bill and did
not give it due consideration pending
its passage, as there was not discus
Uhe Jolly Street school are made were