Columbia University Libraries Digital Collections: The Real Estate Record

Real estate record and builders' guide: v. 22, no. 563: December 28, 1878

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Real Estate Reco AND BUILDERS' GUIDE. YoL. XXII. NEW YORK. SATÜEDAY, DECEMBER 28, 1878. No. 563. Publislied Weekly by €bt%m[€tsi'äk%K(sxti%B5GtMxan. TERMS. OXK YEAR. in advance... .SlO.OO. Commnnications should be addressed to C. W. SAV EET. Nos. 31.^) AN'n 347 BnoADWAV III. LIFE 1NSURA^'CE. In a former artiele we eiido.'ivored to demon¬ strate the safoty of the s\-steni, or theorj-, of tbis busine.ss, by reason of tbe matlieniatical certainty v.'hich underlies all its ciilculatioii.s, und Ibe abundant provision made for all possible coutiu- gencies and unfavorable experiences in tbe verj- Wide margin included iu tbo current rates ot* insurance, over und above tlie limit of ju-tiial cost. As a simple business proposition, aud were it uot that such a change would involve legal (pie.s- tions as to tbe right of eijuality between old and new insurei's, we sbould confidentlv say tbat tbe rates now adopted could be permaneutiv reduced 2ö per ccut ; aud some legal and proper method of effecting such a reduction must sooiier or later be derived. Tbis would leave fewer corporations in thi' business ; but, beyonil ;iny doubt, it would be fouud, iu tbe course of tbe • next ten years, to be u real ble.ssing to the people. The thirtj'-four companies now in busiuess iu this State drew from the people in IS77 ;in income as follows :- C.ish prumiums over................... Note premiums over .................. Renis over........................... Inieresfc on investments................ .......... .Sr)!i,ror).()()o .......... 3.2'-'8.flOO ......... roit.üiiii .......... i."V-'ll~,000 Making a total of over................ SS5,SUi.(K.O In ten j-ears, this income will aggregate 5=8158,- 11MI,U00, and weare irresistibly led bj'this exhibit to discuss the question of the irresponsible control and handling, Investment aud management, of not only the nearly §400,OOü,UOO of present assets, but also of this further accumulation uuited to it, aud forming the truh' marvelous sum of over Sl,208,190,000. When people stop aud look these facts square- ly iu the face, and undertake to estimate the degree of moral courage and business integrity of ollicei's and managers, requisite to the fullilment of this great tnist, the almost more thau human heroism needed to withstand the fearful tempta¬ tiou of such a golden opportunitj-, especially wheu it is considered that so few individuals hold the absolute power of administration, as in fact do, theu they will appreciate the force and can- dor of the sugge.stious we may yet make upou this poiut. Much wise and prudent legislation is de¬ manded upon this subject to Iif fc the sbattered and tottering fabric of life insurance from tbe depths of disgrace into which bad men have dragged it down, and to place ifc upon a safe foundation. The future administration of tbis great interest, so fai'-reaching in its influence and ramifications, so pregnant with blessings fco the helpless and needy, and with power for good or evil to all, musfc be taken wholly oufc of individual hands. and so wisely placed aiid disposed of, thafc ifc will be above all suspicion ; no check, no guard, no precaution should be omitted to secure safet;.-. If the as.sets were all invested iu Stocks of the State, or the Federal Goveniment, and they were prcsided over by a commission as far removed from temptatiou to erv. aud as far above re¬ proacb or suspicion of wrong, a.s is tlie Supreme Courfc of tbe natiou, aud tbo highest aud strong- eat safeguards of the law wore thrown arouiul the bnsinous iu all iis features, theu comi.>arative .safctj- might b • attained. The pi'o|irietar\- fea¬ tures of tiie business must be dis[)en.spd with and wliolly wiped oufc : stock and stockholders shouUl nevi'r be beard of in such a busiuess ; aud evory corv>oratiou now organized ou a stock basis sliould bf» rcorgaui'/ud, if [lossiblp. Tbere aro ccrt.aiu stock companies we can most heartily comuiend by rea.son of their higb sbauding to day; but iu this stock feature thero lurks the greatest pei'il to the people ; and we are s])eaking not only for tbe prosont. but for thu far future. These corporations are perpetual in their vei'v nature : a young man of twouty, who insures today, maj' live for .seventj-j'e.ars : and wbo shall .saj-, with coulidouce, how long this wf)nderful busincs-, which grew to such mammoth proportions in a third of a Century, aud iiaa exhibited so inucli of rottemiess withiu tbe past fewj-eurs willsurvivef If ifc shall fortuuatolj' prove fco be a jiermauent aud lasting .system. instead of a babble, like somo olher great liistoric chimeras of former times, it will certainly need to take ou a dilFereut form from its jiresent: aud it must be .so far and .so rarlicallv ehanged, iu all respects, tbat it will be a new tbing. ditrereut altogether from tbe life insurance of tbo present time W'e are far from assuming to imirk out, or sketch a perfei.'fc method for tbe couduct and management of this interest in the future, but whoever shall prove that he possesses the wi.sdom and .iudgmont und foresigbfc to devi.se tbat per¬ fect method, will be indeed a public beuefactor, iu fche highest .sense of the term. This feature of stock iu life insurance is exceed¬ inglj- pernicious, und has proved dangerous thus far—aud this objection to the busiue.s,s, fcakeii in connection wifch fche acfcual pos.session of the mil¬ lions accumulated bj- each companj-, has been the Chief .source of danger in the past. If we j look at all the havoc which the pa.sfc decade has wit- i nes.sed, and poinfc out the wreck of oue after au- j other of the nearlj"- thirty companies which have | gone to the dogs, so far as concerns their policj-- holders, wo find everj- one was organized ou a basis of capital stock—a proprietarj- basis. "We give the names aud the amouut of the stock capi¬ tal of twenty-soven New York State companies, wbicb, iu one form or another, have failed or gone oufc of busiuess bj- bankruptcj-, drj-'rot, nmalgamafcions, receiverships aud other methods; aud iu additiou to these about twentj- companies of other States have ceased doing busine.ss hi this State, their authoritj- being revoked bj* our In¬ surance Department, but for waut of Space the names of these latter are not given. Thousands of victims throughout fche couutrj-, wbose hard earnings went to swell the millions which disap- pear through the niismanagemenfc of fchese con¬ cerns, will painfully recall tbe names of their old friends, in whose solid streugth and infalli- bilifcy thej' once trusted so coufidentlj', as tiiej' read over the follo%ving list; and fchej- mnv recall perhaps the names of the parties to wbom chiefly thej- owe their misfortunes, some of whom are iu tbe waj- of receiving a light puuisbmont for their crime.s, others of whom are fugitives, but the larger portion of wlmm are j'et mipimi.slied and likelj- to go free. We give tbe names alphabet¬ ical Ij- : Names. Stock. Amerleua l'oiinlar........................... SUK'.OflO AtnerieaM Toiiline....................... 1-.'.").0(KI Amicable..................................... l3it.(Mii) Aslniry....................................... i.-)ii.iH«i Atlantic Mutiiul.......................... tlti.ttOt) Commomvf.-Uth......................... .. I'JI.OIKI Contiii»nt.it................................ llH).()(Xt Cfttfcsineirs .............................. -JiHLiKK) Eclei-iic ................................ 1511.110:1 EiMpire Muiual.............................. !((i.lKiii Enipire State................-................ li)i),00e E.vcelsior..................................... r25,im Farmers' and Mecliaiiics"................... l'->.-),niin Ouiirdirtn Mutual........................... l'J.-).iM)ii Government Seeurity....................... inii.otK) Great Westeni............................... ll.-),IJ0O Herenics -..................................... 15i),tVM) Hope....... .......................... l'-'.I.ODd Mercluints' ................................ Kil.OiK) Mutual Proti'ciioii ......................... luii.oOd National.................................. I.KMKK) New York .State........................... l-''i.O()(i North America.............................. IW.iKKi Securitv.................................... 1 Iil.oOO Stundan: ___............................... it-.'i.OOd Worlri........................................ Sim.nid Wlilows' aml i:>rpliaiis'....................... ','.H>.tO0 It maj-uot have oceurred to the geueral pub¬ lic, but it strikes US .-IS a most signiticaut fact. that the extiuct compauies were everj-oue stock companies. not a single p\irely mutual one among them. Now wliere is tbe wcakne.ss.' It is a:^ plaiti as noon-daj'. Tbe fortuuat«.' man who got control of a bare majoritj- of the ca|)ital stock of one > f these concerns po.s.sessed the absolute power i)f control over its alfuirs: and thus one individual, or a cliquc of two or three, holding .s;ij- .s.")l,0()0 of stock iu a corporatiou having a capital uf :? 100,000, could control its whole patronage, its entire maimgcmeut and its as.sets, whether tbov were >i."),000,00'i or >;.^)0,üllO,000. Upou such au irresponsible management the law places no restraint whatever, except the ordi« narj' peualtj- attaching to aiij' business dis¬ honestj-; uo securitj', no bonds are reijuired. Who of all our readers would have appointed as his admiuistrator, to administer upon eveu a small estate, aiij- single individual, aud dispeuse with that proper aud essential element of safetj' to bis familj'—the bonds retjuired bj- law from the rei resentative of an estate, no matter how small the estate involved .' And j'et people bave for thirtj- j'ears llocked in thousan