The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1935-07-11

the code OF JuStlnlan the Great.
Anglo-Saxon guilds insured their
members against loss from fire, wa
ter, robbery, etc. 1t is properly fit
ting that life insurance should have
been utilized during the Crusades-
the movement which while falling
of its sanctimonious purpose did &C
complish so much for the CONNER
cial development of the world
The humble beginning of Lloyd's
Of London, the oldest insurance Or
ganizatiOn in the world, is attuned
to the romantic saga of insurance.
Edward Lloyd, during England's in
|terregnum as a Commonwealth fol-
lowing the death of Charles 1 in
1649, was a keeper in one of the
many cofee-hOuses which nestled
along the waterfront of London.
Wagered on Arrivals
A popular pastime of the sea-far-
ing men who fraternized in Lloyd's
%coffee-shop was the placing of bets
IN the arrival of ships. Constant
association with this activity finally
prompted Lloyd to assemble all
available information concerning
boats and launch the name into a
business which still exists today.
Curiously enough, the family of
Lloyd'S has never been associated
with the business.
1t is automatic that when you
discuss insurance you must conSort
with New Deal numerals. All life in
surance companies in the country,
for instance, had total Sourc of
close to so, 900 900 900 at the end of
last year, while premiums paid for
the same period were in excess of
$500, 000, 900. This, it should be re-
membered, is only one branch of the
insurance field, albeit the largest.
With these figures in mind it can be
seen readily what a ticklish job con-
fronts insurance departments of
the various states in supervising the
insurance business.
Regulatory insurance laws in In
diana had their inception in 1852,
the year of the new constitution.
Prior to that time insurance COM
panies transacted their business in
conformity with a franchise or a
direct grant from the Legislature.
II was not until 1919 that the states
jurisdiction was taken away from
the auditor and placed in the newly
created Insurance Department.
The Insurance Department, I'M
der the direction of Harry E. Nc
Claim, has both absolute and limited
powers under the Indiana Insur-
ance Law. The necessity of strict
supervision over companies is made
necessary by the fact that insurance
is so completely endowed with the
public interest.
Briefly, insurance is anything for
which you may be reimbursed when
a contingency arises. The types are
multitudinOuS. Fundamentally, In
diana has broken down its 1872 COM
panies into three divisions: Life,
fire and casualty and security and
marine. In addition, there are two
types of corporate structures which
can be set up, mutual and stock
companies. In the former the poll
cyhOlders participate in the earn
ingS of the company. in the latter
the stockholders participate.
Requirements Specific
The requirements laid down for
the formation of a new insurance
company are specific and vary with
the type of business to be done and
the type of structure which is to be
erected. A copy of any policy to be
sold must be examined by the in
surance department and the articles
of incorporation are subject to eX-
animation and approval of the In
Surance Department, the Secretary
of State and the Attorney General.
Every director of a stock COM
pany must be the owner of at least
$1,000 of stock in the company ne
represents. Sale of the stock or
pledging of it to secure any debt
Immediately d~iSqualifeS that per-
son from continuing as a director.
Directors o. mutual companies must
policy holders in their companies
and such policies shall be free of
liens to secure any debt to such
companies.
If, after an examination. it ap-
pears to the department that the
assets of any domestic life inSur-
ance company are insufficient 10
justify the company'S continuance
in business, or that it's capital is
impaired, the department sets a
time within which such impair
ment must be corrected. Further
more, a company finding itself in
such a position is prohibited from
issuing any new policies until the
assets or the capital have been re-
stored.
The department has strict super
vision owe the investments which
insurance companies make. An in
Surance company a not go into
the open market and purchase for
investment any securities for which
il takes a fancy. This list of in
veStmentS which are eligible for in
Surance funds includes Federal and
MUNICIPAL DOAlNL>, dAlO OONlAQ bOAANSs
preferred and common stocks of
corporations whose earnings over a
period of years have been high.
Moreover. these investments are
held in escrow by the department.
License System Used
Every life insurance agent and
every agent, solicitor and broker
doing business in other than life
insurance in this state must pro-
cure a license from the depart
ment. The fee to be paid for the
issuance of such license is So n
nally for an agent. 81 for a solicitor
and $40 for a broker.
Vigilance is also extended w
the officers of any insurance
company. All officers and home Of
flee employees having control of, "
access to. the moneys or securities
of such company shall file a bond