The New York herald., 1922-06-17
INSURANCE BODIES
CARELESS, CHARGE
Lockwood Committee Brings
Out Speculative Character
Of Many Deals.
MACHOLD ON ONE BOARD
Pave Way for Legislation
Tending Toward Restriction
of Companies.

The speculative and frequently un-
profitable character of the stock in
vestments of fire insurance companies
was further disclosed yesterday in the
Lockwood Committees investigation.
which was extended to include upstate
companies as we'll as those operating
from New York city.
The stock transactions of the Agricul-
tural Insurance Company of Water
town. Of which II. L. Machold, Speaker
of the Assembly. is director, showed
q net loss of $685.. .7i0 between 1916 and
1891 and the stocks held by the COM
pany on December 81. 1921, were shown
to have shrunk in value to the extent
OF $50 eco.
This testimony is intended to pave the
way for the reintroduction of a bill in
the Legislature to redistrict fire in
in which the investments of the life in
surance companies are supervised.
Seeks to Get Them on Record.
In this connection Samuel Untermyer
said:
''The bill introduced in the session
this year did not come to a vote In the
Assembly. 1t was defeated in the Rules
Committee. ] am going to put In evil
dence holdings of the stock, as well as
the names of the officers and the direc-
tors. l want to call attention to the
character Of these investments upon the
record" r II
Mr.. Untermyer spoke of the similarity
between the Industrial holdings of the
companies. which caused him to re-
mark that leach fire insurance COM
pany seems to have industrial stocks
that follow the line of certain banking
houses"
In States where there exists a state
monopoly. such as in Nevada. Wash
ington. California and Nebraska. the
expense of administration is much less
than entailed by the private companies
ing New York. it was shown, and in
Ohio, the State most comparable to
New York in Industrial conditions. the
EXPENSES of administering the fund
afrount to to 4 per cent. Of the pre-
qnhIms, whereas the private companies
In New York absorb between 80 and 40
per cent.
John II. O'Hanlon, chairman of the
legislative committee of the New York
State Federation. gave the committee a
great deal of data on the situation,
gained from his experiences during
mahy years in trying to further legisla-
tien directed toward a State monopoly
on behalf of the federation e.
The ID rect settlement" law was re-
realed BY the Legislature. Mr.. O'TIanlon
raid. because it was found that COM
pan'es were taking advantage of it and
'robbing claimants wholesale 3:
Charge Against state Fund.
Asked by Mr.. Untermyer whether the
private companies had an organized
propa ganda against the state monopoly,
the witness declared that they had even
gone so far as to spread the report that
the State fund was insovent. In States
where the monopoly exists, Mr.. O'Hanlon
testified, there has never been penny
lost by an injured workman, and all
the funds have remained solvent.
Miles VI. Dawson. an insurance lawyer
who assisted in the Armstrong investi-
CATION and has made study of insur-
Tnre and workmen's compensation in
various countries. also testified as to the
be -eficial results obtaining from state
ftipd monopoly.
State Senator. Warren E. Tarbel of
Massachusetts related the difficulties
experienced in trying TO get a State
fund law passed i'm the Massachusetts,
Legislature. where 1t has been defeated
mittee on Judiciary on the ground that
the State should not enter into private
business in competition with private
companies. The cost to the private
companies of conducting their compen-
sation business in Massachusetts in
1919. Senator Tarbell said, was s., 2,s0o. COO.
and Ohio In the same period spent
$2S0.000 In carrying the State fund de-
partment. Summing up the advantages
of the exclusive State fund, Senator
Tarbell said:
I'm the first place, II creates far
better feeling between employee and
employer and II guarantees to tho in
iured worker his payment"
The hearing was the last session OF
the committee until they convene in
the autumn. The members expressed
their appreciation of Mr.. Untermyers 5
services and wished him a pleasant
journey on his trip. abroad, which be-
gins to-day