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8 VOTERS OF GEORGIA, READ AND REREAD of railroads having a Texas situs. Other outside compani<?fc at that time had investments in Texas as follows: , Companies. Real estate mortgages. Bonds, etc. Union Central $3,941,260 $ 95,030 State Life of Indiana 264,700 Security Life of Virginia 34,786 National Life of Chicago 2,395 Kansas City Life 23,150 5,000 Franklin Life 10,000 ▲etna 146,000 Metropolitan . . 583,170 $4,276,300 $829,200 This shows a total investment by outside companies at that time, exclusive of the items of railroad bonds, of $105,500. (The Metropolitan Life subsequently withdrew because of the Robertson law.) The combined assets of Texas companies at that tim<| as above shown, amounted to $974,276.38 —practically all of which was in vested in Texas. This makes a grand total of investments at the time of the passage of the Robertson law by all life insurance com panies—both foreign and home—of $6,079,776, On January 31, 1912, investments in Texas by outside companies were as stated in the attached official certificate of the commissioner of insurance and banking. » INVESTMENTS BY OUT OF STATE LIFE COMPANIES (LEGAL RESERVE) IN TEXAS REAL ESTATE MORTGAGES AND TEXAS BONDS, AS OF JANUARY 31st, 1912. Investments in Texas. Company. " ” Real Estate Mortgages. Bonds, ▲etna, Hartford, Conn. $1,929,004 30 $979,000 00 ▲merioan Central, Indianapolis, Ind. 236,811 00 American National, Lynchburg, Va. 18,500 00 Bankers Reserve, Omaha, Neb 86,252 50 Bankers Life, Des Moines, lowa ... 55,000 00 Oapitd Life, Denver, Col 18,750 00 Central Life As. Soo., Des Moines, la. 23,144 34 •Colorado National, Denver, Colo Federal Life, Chicago, 11l 5,050 00 FrankMn Life, Springfield, DI 55,100 00 200,877 10 Gt Western Life, Kansas City, Mo 105,194 60 30,000 00 Hartford Life, Hartford, Conn 611,096 30 Home Life, Oklahoma Ctty, Okla. .. 9,768 00 International, St. Louis, Mo 67,300 00 30,500 00 Kansas City Life, Kansas City, Mo. 332,789 27 •Louisiana National, New Orleans, La Manhattan Life, New York, N. Y 505,000 00 Meridian Life, Indianapolis, Ind. .. 15,000 00 Missouri State, St. Louis, Mo 378,449 20 National Life of U. 8. A. Chicago, 111. 317,353 00 Northwestern National, Minneapolis 109,620 00 1,980 00 Occidental, Albuquerque, N. M 11,200 00 •Oklahoma National, Oklahoma City Pacific Mutual, Los Angeles, Cal... 888,320 70 Pittsburg Life and Trust, Pittsburg 467,565 00 119,070 00 Protective Life, Birmingham, Ala... 9,400 00 3,975 00 •Prussian. Berlin, Germany Reliance, Pittsburg, Pa 100,000 00 Reserve Loan, Indianapolis, Ind 359,654 75 Security, Richmond, Va 43,206 75 •Southern National, Louisville, Ky. . State Life, Indianapolis, Ind 156,650 00 Union Annuity, Cincinnati, 0hi0... 6,101,341 04 U. S. Anm-’tv and l ife, Chicago. 111. . 9,500 00 19,500 00 Volar-'f:- ,?t-t'; T ife 'V--ttanooga.. 37,600 00 ....! $12,822,968 25 1,626,154 60 $12,822,968 25 $14,449,122 85 ..•Figures not available. I hereby certify to the foregoing as a correct list of investments by out-of-state life companies (legal reserve), in Texas real estate mortgages and Texas bonds, as these investments are shown in the Robertson schedules submitted to me by these companies. Commissioner. (The John Hancock Mutual of Boston, which has never written insurance in Texas, and therefore makes no report to the depart ment, has been doing a loan business in Texas for many years, and w* are reliably informed has investments in this state of approxi mately $5,000,006.) The Texas companies, as above shown, have assets of approxi- A History and Discussion of the Results of the Operation of the Robertson Law The first official suggestion that such aTTTT^passecHva^ir 1 ” a message from Governor Charles A. Culberson to the legislature in 1897, as follows : '"Legislation requiring these companies to invest an nually a reasonable percentage of the premiums re ceived from this state in property here is not only manifestly reasonable and just but dictated by sound public policy. **• It is time that the resources of the state should be devoted to her own growth and*’prog ress and the adoption of the policy indicated will strongly tend to keep capital here and build upon it.’’ In 1906 Hon. John H. Kirby said, in a speech made before a bankers convention: “Now what I propose is that the reserve fund ap portioned to insurance policies carried by the citizens of I exas in foreign corporations doing a life insurance business shall be invested in Texas.” . in bebruary, 1912. Mr. Kirby said: M) own opinion is that that proposition to require life insur- THE ATLANTA GEORGIAN AND NEWS. SATURDAY, JULY 27, 1912. mately $10,500,000, practically all o; which is invested in Texas— making a grand total of investments in the state by life insurance companies (excluding the John Hancock and all other companies not doing life insurance business in this state) on January 31, 1912, of $24,949,122.85. Eighth---Statistics concerning rate of interest and dis count charged by outside companies and Texas companies on money loaned or invested in Texas securities. Reports of insurance companies to the department do not show the rate of interest charged in any particular state, answer to this inquiry is consequently not available. The Union Central has the largest amount of loans in Texas of any of the outside companies, and it is our information that it charges about the same rate of in terest as the home companies. Ninth---Statistics concerning funds loanable by Texas companies in Texas and funds loanable by outside companies in Texas. The amount loanable by Texas companies will be the present as* sets and the net accumulations of such companies each year, which can only be estimated. On the basis of $116,000,000 in force now and the writing of $50,000,000 of new insurance each year, Texas companies will accumulate funds available for loans at the rate of about $1,500,000 this year, $2,000,000 next year, with a more rapid increase thereafter—proportionate to the amount of business trans acted. The amount available for loans by outside companies is 75 per cent of their Texas reserves, and will be dependent upon the amount .of business they transact in the state. Seventy-five per cent of the legal reserve is approximately equal to 50 per cent of the premiums charged by any life insurance company. Under the Robertson law the actual investments by outside companies have increased from approximately $4,600,000 in 1907 to $14,449,123 on January 31, 1912. A reasonable estimate of the amount which they will invest during 1912 is $3,000,000. Os course, the investments required from companies obtaining a license to do business in the state for the first time and companies which formerly withdrew and come back will increase this amount. Tenth---Data concerning success of insurance com panies organized in Texas. We think this inquiry answered by above statements. I Eleventh -Hou) do premiums of outside companies and Texas companies compare? The Texas companies are charging about the same premium rates for insurance as have been charged by other old-line compa nies on the same forms of policies for the past 50 years or longer. Twelfth--Has there been any change in the cost of insurance to the people of Texas since passage of the Robertson law? There are several questions involved in this inquiry. The rates charged now are practically the same as were charged here tofore, but the actual cost to the people in the aggregate would nat urally be less if the money remains in the state. Thirteenth—Has there been any change in the rates paid for money obtained by persons in Tfexas from in surance companies? We believe that the rates of interest charged for money loan ed are regulated by the law of supply and demand, and insurance companies, like all other financial institutions, usually get the prevailing rate of interest. We believe that the interest’rates are lawer now than at the time of the passage of the Robertson law. Fourteenth---Number ofTfexas policy holders in out side companies and in companies and aggregate amount of policies. December 31, 1906, was the last report covering the business of all outside companies, which discloses, as above shown, that they had on that date $262,8L8,590.80 of outstanding insurance on 169,475 lives, while Texas companies had only $18,000,000. On December 31, 1911, Texas companies had, as above shown, $116,- 000,000 of outstanding insurance on the lives of about 35,000 pol icy holders. The amount held by outside companies on that date is $262,818,590.80, less what has lapsed and otherwise termi nated since December 31, 1906, plus the business of the outside companies that did not retire upon the passage of the Robertson law and plus the business of the other outside companies that have since come into the state to do business. We have no means available for obtaining the exact amount, but we doubt if the whole outstanding insurance now held by outside companies would show policies on the lives of Texans has come to be a part of our fixed public policy. I think I was the father of this idea in Texas, as I had made several speeches which were extensively published ad vocating a law of this kind. Judge Robertson took up the idea and the original legislation upon the subject initiated in a bill which he introduced and put through, therefore the law bears his name. I did not agree with the deposit features of the Robertson law, but was in hearty accord with the principle of requiring insurance com panies to make this investment. “The Robertson law was passed In 1907. In 1909 the deposit feature of that law was repealed. A bill known as house bill No. 89. approved April 2, 1909, substantially repealed the whole Rob ertson bill, but re-enacted certain features of it, and especially the • investment feature. The investment feature is a just provision and it is one at which none of the insurat.ee companies have any right to complain. The deposit feature, however, was. in my judgment, a piece of reckless experimentation. The legislature, t * more than a slight increase over the amount outstanding at the • time of the passage of the Robertson law. Fifteenth---Is maintenance of present Texas insurance laws desirable from standpoint of Texas companies—if so, why? If not, why? Is maintenance of same law desirable from standpoint of outside companies---if so why? If not, why? The laws now in force In this state governing the formation and control of home insurance companies were drafted with great care. It follows very closely the Armstrong bill, passed a few years ago in New York. As a matter of fact, the act reflects the most modern and progressive thought on the subject. The forms that policies may take is controlled. Forfeitures on account of lapses are dealt with, and the policy holder in this way protected against injustice. The character of investments that may be made are fixed. Discriminations are forbidden. Departmental super vision is provided for. While it would be impracticable to under take to go into all of its features, speaking generally, it may he said to safeguard the business with all of the particularity that the advanced thought of the day demands. If it be subject to criti cism, it is on account of the fact that it, in truth, imposes an ex cessive tax on home companies. The taxes that these companies now have to pay is disproportionately large when compared with the tax that outside companies would have to pay upon equal pre mium receipts. We do not think that, for the present at least, this law should be experimented with. The home companies have been, and, we think, will continue to prosper under it, and in time become strong and helpful factors in the economics of the state. We can see no fair objection that can be made by the outside companies to the Robertson bill, which was intended for their con trol. The tax put upon them is no larger than the average tax imposed upon outside companies by the other states, and there never has been a sane or tenable argument advanced against the requirement that they he compelled to invest in this state a por tion of the money collected from the citizens of the state. Those of them that have fairly investigated the subject know that they can get just as safe investments here as elsewhere. For instance, here is a statement from the president of tire Pittsburgh Life and Trust Company, now doing a large business in Texas: Pittsburg, Pa., March 1, 1912. “Tn answer to your inquiry as to the amount that the Pitts burgh Life and Trust Company has invested in your state, would say that this company qualified to transact business in Texas since the enactment of the Robertson law and has invested more than half million dollars in first mortgages and now has more than the amount necessary to be invested under that law to entitle the company to the lowest tax charge. We have found the invest ments satisfactory so far and have made and are still making ad ditional loans, notwithstanding the fact that we have already com plied with the law.” Sixteenth -What is the interest of the people of the State of Texas? Keep Texas money in Texas. Tn saying this, however, we do not wish to be understood as committing ourselves to the advocacy of a narrow or provincial policy. We know, and all well informed people know, that investments are to be found any and everywhere in this state as safe as those offered by New York or any other state, and companies wishing to come here ought to be willing to deal fairly with us. They should be willing to leave in our com merce a portion at least of the money that they get from our peo ple. As we understand it. this is all that is put upon them by the law that they now complain of. RESPECTFULLY SUBMITTED, publicity Committerof Texas Life Cdn vastly •with Judge Robertson’s full approval, rose to the emergency and eliminated the deposit feature from the law. ‘‘There is no question but that the enactment of tl.e Robertson law did drive a great many foreign insurance companies out of this state in the sense of soliciting insurance in this state, but your let ter stated that the effect of this was to destroy a source of cheap money to Texans. “If you will investigate as to the amount of money loaned or Invested in this state by life insurance companies prior to the en actment of the Robertson law and compare it with the very large investments made since that enactment, I think you will be as tounded at the figures. To my mind they suggest that instead of the Robertson law depriving us of an opportunity to secure money in the development of this state, just the opposite is true." Except section 5. which related to taxation and which was superseded by an act passed at a called session of the same legis irture, and already quoted herein, the following is a copy of the Robertson law. It will be seen that it is now shorn of the features urged as objectionable by the 21 outside companies that withdraw from Texas at th; time the law was enacted: