Bismarck daily tribune. [volume] (Bismarck, Dakota [N.D.]) 1881-1916, 1916-09-01

of life insurance may be issued in thi!
state, and regulating the condition!
and provisions to be contained il
policies of life insurance companie!
that do not adopt such STANDARD
FORMS" This is one of the measure!
which was prepared by the "Com
mittee of Fifteen" following thu
memorable life insurance investiga
ton in New York in 1866, and wa!
enacted into law by nearly all of thu
State legislatures in 1907. But the
Act pre-supposes that the policy
forms will be examined and approx
ed or disapproved by one who under
stands, not only the law, but the
scientific principles involved, and moi
by the mere ipse dixit of an Insur
ance Commissioner "clother with {
little brief authority" In this con
nection l desire to make public ack
nowledgment of my Indebtedness tt
Mr.. A. l.. Dern, Actuary of the Pion
eer Life Insurance Company of Fargo
N. D., whose counsel, advice and as
sistance to this Department during
the past four years, though rendered
gratuitously, have been invaluable.
Would Combine Departments.
AS indicated in my report for tine
year 1914, it would be entirely feas
ible to combine under single head
two of the most important adjuncts
or functions of this Department
actuarial service and the examination
of insurance companies. Not only
has the work of examining domestic
insurance companies, which now de-
wolves upon the Commissioner or his
deputy, becomes decidedly burden
some, but it is of far too great i'm
portance to the public to be entrust
ed to those who have had no train
ing or experience as accountants. II
it no less unfair than 1t Is absurd
that public official charged with the
duty of supervising the insurance
business for a Commonwealth, and OF
seeing to it that every insurance com
pany doing business therein is at all
times solvent, should be chosen with
out any regard to his qualifications
and at the same time be denied as
sistance that would be provided as
matter of course in private institu
ton or enterprise. Every life insur
ance company in the world has ar
actuary on it's staff, and the larger
companies maintain whole fl0cks OF
these mathematical sharps." Aside
from North Dakota l do not know Of
a single state in the union whose In
surance department is not provided
with an official examiner.
Finally, it cannot be claimed thai
this Department is unable, from 8
financial standpoint, to pay the salary
of an actuary -examiner. This IS evi
denced by the fact that the fees alone
during the year ending Dec. 81, 1915
amounted to $39, 2S305, while the ia,
receipts aggregated $1l5y57393. Fol
the same period the total expense fol
maintenance was less than ten thou
sand dollars. 1t should be remem
bered, too, that the expense of ex
aminations is borne directly by the
companies examined. ....
Wants Rate Supervision.
Efforts to secure favorable con
sideration of bills providing for the
supervision of rate-making bureaus
and of the rates charged by fire in
surance companies on riskes situated
in this State met with failure in the
Fourteenth Legislative Assembly. il
will be recalled that the bills were
introduced in the Senate, and that q
test vote resulted in tie, the decid
ing vote being cast by the President
of the Senate-negatively. Had the
bills been introduced in the house
always more responsive to popular
demands-they would have been en-
acted into law. If much more drastic
measures than those proposed two
years ago should be passed by thu
forthcoming legislature, it would per
haps be no more than poetic justice
There is more or less confusion ir
the public mind as to the essentia
difference between rate making ant
rate regulation. A few states have
gone so far as to take over the func
lions of rate-making bodily. Rates
are literally made by the State, ant
the insurance companies must need!
adopt them. willy-nilly. This plar
doesn't work we'll. 1t is impractic
able, Ihigh-handed, undemocratic.
Not interested Right.
On the equally important othel
hand, it is ridiculous to assert tina
regulation by the State of the rate:
charged by insurance companies do
ing business therein-by permission
not by inherited rights unjust in
reference with the rights of private
enterprise. Decry it as the partisan
of fire insurance companies may, ant
do,-the Supreme Court of the Unite'
States defined the principle upol
which rate-regulation rests when |
declared that "the business of fir
insurance is so far affected with put
lie interest as to justify Legislative
regulation of its rates."
That the rates, taken as q whole
charged by fire insurance companie
in North Dakota are excessive |
much more easily asserted than prov
ed. That they are too high in som
instances and on certain classes Q
property, l do not doubt. Descrimins
ton in favor of or against certai
kinds of risks is perhaps the mos
common weakness Of fret insurance
Whatever the facts may be, this ii
tolerable situation exists: Man
property owners in this State believ
that the premiums they are compel
ed to pay for fire insurance are e,
cessive; others believe they are di'
eliminated against most unjustly-
that the rates they have to pay ar
altogether out of proportion as con
pared with the rates charged on risk
of like charcter and subject to tn
same measure of hazard; there ar
towns villages in this State whic