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PUBLIC LIBRARY

851-19

ASTOR, LENOX AND
TILPEN FOUNDATION8.

1897.

PREFACE.

It is proper to say of the following compilation that it is made up of the brief notes of the proceedings of the Convention, taken by the Secretary during its progress, and the more extended reports of journalists and newspaper correspondents who attended the Convention. No stenographer was employed, consequently the assistance rendered by these voluntary reporters lias been very valuable. The Secretary is under great obligations, especially to the Detroit papers and Mr. E. A. Hewitt, of the Chronicle.

Some of the speeches and papers presented appear in full, while the discussions are sufficiently reported to indicate the views of those who engaged in them.

It is to be regretted that this report could not have been issued earlier. The delay is mainly chargeable to Commissioners and others who were invited to write out their remarks. Some were very tardy, while others failed to respond at all, otherwise than to excuse themselves at a late day by pleading “want of time.” All this has been very annoying to the Secretary.

The Convention was more fully attended than any one since the fall session of 1871, and was emphatically a working Convention. It is safe to say that the members never before so fully appreciated the importance and responsibilities attaching to their special work. And it is equally safe to say, they were never more strengthened and fully prepared for their work by the discussions and familiar interchange of views upon the great variety of topics considered, than on this occasion.

These annual meetings have a tendency to promote inter-state comity, by removing frictions naturally arising under diverse legislative enactments, and it is hoped will eventually result in the repeal of such conflicting laws as are obnoxious to the great interests of Insurance.

In the Appendix may be found a complete reproduction of the admirable papers upon taxation and the discussions thereon,

which it was thought best to insert together, that they might readily be pointed out to legislators and to others.

Next in order is inserted a valuable paper on the “Fallacies of Life Insurance Laws,” and other items of interest connected with this subject, by Dr. T. S. Lambert, who failed to be present on account of the unexpected adjournment of the Convention while he was on the way.

Then follows an outline draft of an Insurance law, to be perfected hereafter, and recommended for general adoption.

The Conclusion is the “ Balance Sheet Blank” for the annual statement of Life Companies, to be used after the present year by the several departments.

The experience of the last few years has shown the necessity for more intelligence, more vigilance, closer, and more cordial sympathy, and a better understanding not only among insurers and the insured, but among those who undertake to supervise this great interest.

With the hope that it may do something to secure these desirable ends, this little pamphlet is respectfully submitted to the public. By order of the Executive Committee,

OLIVER PILLSBURY,

Secretary of the Convention.

REPORT

OF THE

Fifth Session of the National Insurance Conven

tion of the United States,

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WHICH MET IN THE CITY OF DETROIT, SEPTEMBER 2, 1874.

FIRST DAY - WEDNESDAY,

THE Annual Session of the National Insurance Convention of the United States met in the Council Chamber of the City of Detroit, pursuant to notice, Sept. 2, 1874, at 11 o'clock A.M.

Hon. 0. W. Chapman, of New York, President of the organization, having called the Convention to order, said it gave him pleasure to meet so many of his brother officers in convention representing the insurance interests of the several States, and that very many subjects of great magnitude and importauce to the companies and to the public would demand its earnest but conservative attention,

The magnitude of the questions may be partially comprehended when it is realized that the gross assets of the several companies whose supervision it is the special duty of the members of this association to superintend, will reach about eight hundred millions of dollars and the amount of insurance in force ten thousand millions of dollars; in the stability of the life companies alone over five millions of people are directly or indirectly interested, and, including the fire and marine, nearly all the people of our country are interested.

It is, therefore, of vast importance that the several insurance departments of the States should meet and exchange opinions, and compare practice with theory, assured that each department may thus become uniform in its decisions and official actions, so that the unanimous resolutions or legislation proposed by this Convention should go forth with force to the Legislatures of the several States for adoption, if by them approved right and manifestly just.

The departments, he thought, have materially improved since the first session of the Convention. Several of those recently organized have already brought themselves up to the standards of the oldest and the best.

He said that companies which ought not to be admitted were continually knocking at the doors of the departinents. If they are admitted the consequence is injurious, not to the public only, but to themselves as well. If they are rejected, they are kept at home where there is a possibility of their success. Suppose the certificate of the New York department is brought to any other department, it is fairly to be supposed that it presents the facts; but it is not a request of the New York department for the admission of that company to any other State. It is not an expression of the opinion of the New York department that it ought to be so admitted. It may not come up to the standard of other States. Its admission may not approve itself to the judgment of other commissioners. The New York commissioner may not think it best that the company should go abroad until it has gathered experience and strength at home; still he is often obliged to certify to its right to do business in his own State. In the case of such applications for admission, the besieged commissioner should remember that there may be circumstances surrounding the issue of the certificate of the parent State which render it even desirable that admission to other States be for the time refused-refused until the company has demonstrated more fully its right to go abroad. Why not have such mutual understanding and confidence that commissioners can in such cases write to each other?

It was important that the reciprocal equitable rights of the several departments of the States should be carefully considered and settled, so that a company having the official certificate of one State, and applying for admission into another, may know what it must expect, and not feel itself unjustly dealt with if admission is refused until it shall receive the examination and approval of the department of the State in which it seeks the right to do business.

The question, also, of the nature of the assets that should be held by fire companies especially will come up for serious consideration. It would seem. said the President, to be the result of experience that prudence decides that nou over one half the gross assets of fire companies should consist of bonds anu mortgages; that at least one half should be invested in immediately available securities; that while bonds and mortgages are justly considered the most substantial of all securities, when properly executed, nevertheless experience has demonstrated them liable, through fraud or perjury, to be the most worthless. The spirit of the Convention should be toward conservatism and the adoption of no untried innovation until its safety was settled beyond question- until experience shall enable the Convention to safely take final action on all the various questions proposed.

The minutes of the last session of the Convention being called for, the Secretary, Oliver Pillsbury, of New Hampshire, proceeded to read from the printed report; whereupon Mr. Rhodes, of Massachusetts, moved, that inasmuch as the doings of the last Convention had been published, the further reading be omitted. Carried.

Mr. Row, of Michigan, liere took occasion to introduce to the Convention a committee of the Board of Underwriters of the City of Detroit.

Hon. Mr. Vernon, in behalf of the committee, gave the Convention a cordial welcome to the city, and begged the privilege of making some testimonial of its hospitality. To this end he proposed a steam-boat excursion on the beautiful Detroit River, to the Convention and other strangers present, including ladies accompanying attendants upon the Convention, whenever it would be most convenient.

The President referred this proposition to the Executive Committee, which recommended that the invitation be accepted : adopted.

On motion of Gen. Smith, of Kentucky, the Convention adjourned to meet at 2 o'clock P.M.

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