Wednesday, June 20, 2012

The Condition of the Life Insurance Companies of the State of New York. 1877


THE CONDITION of the LIFE INSURANCE COMPANIES of the STATE OF NEW YORK. REVISED TABULATED EDITION of the OFFICIAL STENOGRAPHER'S NOTES of the INVESTIGATION BY THE ASSEMBLY COMMITTEE. Together with Correspondence, Summary and other Matters of Interest in connection with Life Insurance.

ALBANY, N. Y.: W. S. MANNING, Publishers

Entered according to Act of Congress. in the year 1877, by W. S. Manning, in the Office of the Librarian of Congress, at Washington.


The testimony printed by the Committee contained so many errors and omissions, as to render it wholly unreliable and inadmissible as evidence. The official stenographer was not permitted to examine the proof of the document printed by the Committee, hence cannot be held responsible for the many and manifest errors therein contained, amounting, in many instances, to distortion, if not wilful misrepresentation of facts. This, taken together with the extreme interest that some of the members of the Committee exhibited in shielding several of the witnesses, often sustaining them in their refusal to answer certain questions asked by the counsel of the Committee, and, finally, closing the investigation, when half completed, has created, in the minds of those familiar with the proceedings, suspicion as to their motives, as well as grave doubts that they honestly performed the duty imposed upon them by the Assembly.

The publisher employed the official stenographer to correct the errors, and to give him a true and correct copy of the evidence, which was carefully done, after much labor on his part, and expense on the part of the publisher. Appended will be found the certificate of the ofiicial stenographer, who has thoroughly examined this edition.

The corrections, owing to a misunderstanding with printer, were made in italics in parenthesis to page 163 ; after that the parenthesis is omitted.

Office of Harry Edwards,STENOGRAPHER,
ALBANY, N. Y., May 21st, 1877.

I, Harry Edwards, of the city and county of Albany, do hereby certify, that at the request of Mr. W. S. Manning, I revised and corrected the minutes of evidence taken by me as the official stenographer of the Assembly Committee on Insurance, in an investigation held by said Committee into the various life insurance companies of this State ; said W. S. Manning having informed me that he required a corrected copy for publication.

I further certify, that have I only corrected one copy for said W. S. Manning, retaining in my possession said original notes for no other purpose than to produce the same in courts of justice, as evidence under subpoena, if required, and that said W. S. Manning has the only complete revised and corrected copy of said evidence.

[Seal]. Official Stenographer.

Signed and delivered in presence of
(Signed) Richard P. DUMARY.


HENRY D. WINTON, of the town of Hackensack, of the county and state aforesaid, being duly sworn, deposes and says, that he printed the work known as the "REVISED TABULATED EDITION of THE OFFICIAL STENOGRAPHER'S NOTES OF THE INVESTIGATION BY THE ASSEMBLY COMMITTEE;" that the same is printed from a correct copy of the testimony from the stenographer, and that this work is correct, to the best of deponent's knowledge and belief.


Subscribed and sworn to this 5th day of December, 1877, before me, at Hackensack.
ABRAHAM D. CAMPBELL, Notary Public of N. J.

page 1


Mr. J. G GRAHAM, from the Committee on Insurance, makes the following preliminary report of testimony taken, under resolutions of investigation referred to them:


TUESDAY, March 20, 1877.

The committee met at its room on Tuesday morning, at nine o’clock.

Present—Hon. J. G. Graham, Chairman, and Messrs. Cowdin, Husted, Lang, Skinner, Moody, Weiant and Floyd-Jones; Hon. N. C. Moak, of counsel for the People; Hon. Matthew Hale, of counsel for the Equitable Life Insurance Company; Judge Davies, of counsel for the Mutual Life Insurance Company.

The Chairman-—We will proceed with our inquiries this morning, and, as Judge Davies was here first, we will proceed with the examination in reference to the Mutual Life Insurance Company.

Judge Davies—I have a letter here which, with the permission of the committee, I will read, and then you can proceed to the examination of Mr. W. H. C. Bartlett, the actuary of the company, who has a statement, which he has reduced to writing, containing all the information, I think, the committee desires. The letter is as follows:

140 TO 146 BROADWAY,
NEW YORK, MARCH 17, 1877.

To the Hon. J. G. GRAHAM, Chairman of the Assembly Committee on Insurance, Albany, N. Y.:

Sir—Subpoenas to attend in Albany, at nine o’c1ock on Tuesday morning, March twentieth, have been served upon the vice-president of this company, acting as president, the second vice-president, the actuary and the secretary.

The president being in California, a literal compliance with the terms of such subpoenas would strip the company of official direction, and render the transaction of ordinary business impossible.

It is respectfully assumed that the insurance committee did not contemplate so grave an injury to the company’s interests, but that a substantial compliance with the mandate of the subpoena will be accepted.

Under any other circumstances than those about to be detailed, the vice-president, as acting chief officer of the company, would personally present himself before the committee, and furnish the

information sought; and he expressly disavows intentional disrespect in failure to attend at the time stated, for the following reasons:

On Wednesday, March twenty-one, occurs a meeting of the board of trustees, pursuant to its by-laws, preceded on the same day by a meeting of its finance committee, at both of which meetings the presence of the vice-president is absolutely essential to the interests of the company. And the time and attention of the vice-president will be necessarily, and almost exclusively, consumed on Tuesday, the day before such meetings, in preparation and arrangement of important business to be brought before the meetings, and therein acted on.

The absence of the president is due to a bronchial affection from which he suffers at this season, and which has necessitated his visit to a milder climate during the spring months, annually, for several years past. He left on the twenty-second of February.

The second vice president, Mr. Granniss, has been connected with this company only since January last.

The vice-president, therefore, craves to be excused for non-attendance before the honorable insurance committee, for the reasons stated, and proffers the attendance of the actuary of the company, Professor William H. G. Bartlett, LL.D., and of the secretary, Mr. Isaac F. Lloyd, who will then present themselves before the committee on the day and hour named, furnished with the information the committee desire, and prepared to answer on oath as to the truth of the same.

The Hon. Henry E. Davies, of the company’s counsel, having occasion to be in Albany at this time, has been requested to hand you this letter.

Respectfully submitted,


Mr. BARTLETT—I have a statement here which, if the committee please, I will now proceed to read.

The CHAIRMAN—The statement you proceed to read is what?

Mr. BARTLETT—I was going to read this letter addressed to you by our vice-president, in continuation of the same subject that Judge Davies has been addressing you upon. It sets forth in more detail the reasons why an earlier compliance with the requirements of Mr. Bixby’s resolution, introduced in the Senate, was not furnished. With your permission, I will read.

Mr. LANG—If this statement consists of essential facts with reference to which we are making inquiry, it should be made on oath.

The CHAIRMAN—Does it contain information?

Mr. BARTLETT—Yes; it is full of statistics.

The CHAIRMAN—Are they facts of which you have knowledge?

Mr. BARTLETT—I have knowledge of them.

The CHAIRMAN—Does it contain the information asked for?

Mr. BARTLETT—It contains all the information asked for, and a great deal more.

The CHAIRMAN—Is it within your knowledge?

Mr. BARTLETT—Yes, sir; both of these papers are sworn to by the president and the vice-president; I will also swear that I have investigated the subject pretty thoroughly, and I believe them all to be true in fact.

The CHAIRMAN—It is for the committee to say whether they will have the statement read, and take it for what it is worth as far as it goes.

Mr. LANG—We cannot tell whether it contains what we are inquiring after until it is read through.

The CHAIRMAN—Mr. Bartlett says it does.

Mr. LANG—The question for us to decide is, whether it gives what we are after.

The CHAIRMAN—The committee will only receive what is inquired after, and what is within Mr. Bartlett’s personal knowledge.

Mr. BARTLETT—The officers of the company do not wish to be regarded as contumacious. It was absolutely impossible for us to collect the information asked for at the time. We were engaged in a very exhaustive examination at the time, not only by the Superintendent of the Insurance Department, but also by the trustees, and we were just on the eve of making our annual statement to the State department, consequently we were overwhelmed with business. One reason for this was the change made in the insurance commissioner. We had to look over our books and collect the information required, and this we could only do when we could get a little suspense from the labors of the office.

Mr. COWDIN—I think we shall save time by letting Mr. Bartlett go on and make his statement in his own way; he has a statement here, and I think the company should be allowed to make any statement they wish in their own way.

The CHAIRMAN—Are the statements contained in that communication such as you know yourself to be true?

Mr. BARTLETT—I know them to be true as well as I can know any thing. I have examined the book, and know all the transactions through the various oflicers, and there is nothing contained therein I that would not be willing to swear to myself, to the best of my knowledge and belief. It must be borne in mind, however, that the facts contained therein were prepared for the Superintendent of the Insurance Department.

The CHAIRMAN—Proceed with your statement.

Mr. BARTLETT—The letter is as follows:

To the Hon. J. G. GRAHAM, Chairman:

Sir—In furnishing a written answer to the questions embraced in the resolution, passed by the Assembly of this State, as follows:

"Resolved, That the insurance committee of this House be required to summon the president, vice-president, secretary and actuary of the Equitable Life Assurance Company, the Globe Mutual Life Insurance Company, the Knickerbocker Life Insurance Company, the Metropolitan Life Insurance Company, the Mutual Life Insurance Company, the New York Life Insurance Company, and the


World Life Insurance Company, and require a statement, under oath, from each of them, as to the amount paid in salaries, fees, compensation or donations to their respective presidents, vice-presidents, secretaries, medical examiners, attorneys, counsels, and all other employees for the year 1876, and report the result of such examination to this House in ten days."

The following explanation seems proper to be made:

A resolution similar to the foregoing, but imposing the duty of eliciting the information sought upon the Acting Superintendent of the Insurance Department, was passed by the Senate, by the motion of Senator Bixby, in January last, and a copy addressed to this company.

At that time, two minute and exhaustive examinations of the company’s condition were in simultaneous progress at its oflice, one conducted by a committee consisting of six of its trustees, appointed by the board for that purpose; and the other by the said Acting Superintendent of the Insurance Department, aided by his deputy and several assistants.

Oppressed by the arduous labor imposed on the clerical force by these two examinations, and the necessity of attending on the company’s regular business at the same time, the officers as ed that they allowed to procure from the books a portion of the information called for, viz.: That respecting the amount paid to attorneys and to medical examiners, during the intervals of other labor, and promise to complete and furnish their report on receipt of notice from the acting superintendent of the time when his report to the Senate was read for transmission.

This was acceded to, but by oversight or inability to send a notice in time, the late acting superintendent presented his report to the Senate, no notice of his intention having been furnished to this company.

The communication, which is hereto annexed, contains full and true answers to the questions contained in Senator Bixby’s resolution, and by consequence to those contained in the resolution of the honorable the Assembly of this State; it was completed on the day of this date, and verified by the president on the date of the jurat appendant, and would have been forwarded to the late acting superintendent, except for the misunderstanding above referred to.

All of which is respectfull submitted,


March 17, 1877.


Richard A. McCurdy, of said city, being duly sworn, deposes and says that he is the vice- president of the Mutual Life Insurance Company of New York; that the facts set forth in the foregoing statement are true to his own knowledge, and that the facts set forth in the statement hereto annexed are true to his own knowledge, except

as to such as are stated on information and belief, and that as to such facts he believes them to be true.


Sworn and subscribed before me this 17th day of March, A. D. 1877.
WILLIAM G. DAVIS, Notary Public.

The Mutual Life Insurance Company of New York
Corner Liberty and Broadway
New York City, February 13, 1877.

Hon. WILLIAM SMYTH, Acting Superintendent Insurance Department:

DEAR SIR.—We are in favor of your letter inclosing the following resolution assed by the Senate:

"Resolved, that the Superintendent of the Insurance Department be and he hereby is requested to obtain from the various life insurance com anies incorporated under the laws of the State of New York a detailed statement showing the amount paid in salaries, fees or compensation, or donation to their respective presidents, vice-presidents, secretaries, medical examiners, attorneys, counsellors and other employes, in the ear 1876; and that such information be furnished to the Senate at the earliest day practicable."

We presume the Senate would deem it an incomplete and unsatisfactory report were we to give that honorable body, in response to that resolution, a bald statement of figures, limited to the points of inquiry which they have addressed to the different life insurance companies through you. This would not only be unjust toward that respectable body, but toward the companies reporting, as they embrace corporations of small accumulation and limited business, together with those which, by the force of circumstances, control large accumulations and extensive business.

We therefore, consider it within the line of our duty in the items requested, to give also such existing facts as will enable the Senate to judge of the propriety of the company’s course in reference to its expenses for salaries with intelligence and full appreciation of the subject.

This company has been in existence since 1843. It is without capital, and the first cash it received and possessed was the first premium paid on a policy, amounting to one hundred and eight dollars and fifty cents ($108.50). All of its accumulations have been from its premium receipts and the interest and income growing out from the same.

At present it has in force ninety thousand one hundred and twenty-five (90,125) policies, insuring three hundred and one million two hundred and seventy-eight thousand and thirty-seven dollars ($301,27 8,037); and its business, specified in your letter and the resolution accompanying it, that is, the year eighteen hundred and seventy-six (1876), was the issue of eight thousand one hundred and twenty (8,120) policies, the receipt of fifteen million one hundred

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