The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1915-03-27

tWo-tnlrdS rule, the vote standing 13
for TO 80 against.
the operations of the sinking fund
commission, and he offers to take over
the present contract Of reinsurance
upon the same terms they are now
effecting their reinsurance at any
time:
Columbia, S. c.. March IS, 1915.
Mr.. Jas. A.. Cathcart. Columbia, s. C.
Dear Sir. Confirming our converse
ton this morning with regard to the
bill: To regulate the writing of GER
tain classes Of insurance in the State
OF South Carolina and to provide for
the division Of the commissions, i
have to advise that there is nothing In
the present bill. in my opinion, that In
any way appertains or applies to REIN
surance. The act is identical in re-
spect OF the resident agents feature
with the existing law and is specific in
referring to the writing Of insurance
on property located in the State of
south Carolina. A reinsurance con-
tract does not in any sense insure
property in the State of South Carroll
ma; ON the contrary, II is o contract
between companies. by which Com
pany b. the reinsurer, for example,
agrees to share losses sustained by
Company A. the company writing the
insurance on property in the State Of
South Carolina, for example. The re-
insuring Company B. does not ordi-
narily issue a policy Of reinsurance;
the matter Is usually arranged under
a contract known as a treaty con-
tract
The law Of South Carolina pro-
hibits companies from doing business
In South Carolina without being IL
censed and paying certain taxes and
fees. The law does not prohibit,
however. companies from r~einsurlng
their policies on property located in
South Carolina with companies not
authorized to do business in South
Carolina.
Insurance and reinsurance are en-
tirely separate and distinct operations,
and reinsurance is only held to come
under an act expressly referring TO
same. which the present act does not
do either directly or indirectly. We
do not intend 10 make any change,
nor can we legally be compelled TO
make any change, in our method of
doing reinsurance by the act In ques-
tion any more than we could have
been by the resident agents law, en-
acted some years ago; and We shall
continue to handle our reinsurance as
we have heretofore done, and would
be glad L reinsure the sinking fund
now affecting their reinsurance.
Very truly yours,
(Signed) Edwin G.. Siebels.
Manager
Resident agents laws have beer
adopted I'm every state and territory
except Alaska. California, District OF
Columbia, Indiana, Kentucky, New
York and Porto Rico.
III this bill affects reinsurance con.
tracts. as Mr.. Jones would have thC
public believe, the companies now re
insuring the sinking fund commission
are violating the act passed II 1900
tsection 2713. code of laws of South
Carolina, 1912. which is almost iden
teal I'm it's provision with reference I,
, fire insurance with the resident agents
; bill under discussion. This act wa!
passed in 1900. Mr.. Jones was insur
ance commissioner previous to 1905
The act required every fire insuranc,
poly written ION property situatcc
' and located i'm this state" To- be coun
tersigned by agents resident i'm thi
state. who shall receive the commits
= slons thereon" Why did not Comp
~troller General Insurance Commits
' sioner) Jones require reinsurance con
! tracts to be countersigned by loca
agents? He either failed in his dut
l. then or Is ignorant of insurance now
: II perchance no Is upheld i'm his con
t%ention that this proposed act affect
T. reinsurance. we will ask that the pro
visions Of the act Of 1900 be enforced