INSURANCE ASSETS

Gisborne Herald, Volume LXVIII, Issue 20492, 28 February 1941, Page 5

INSURANCE ASSETS

FREEING PROPOSED LOANS TO BUSINESS U.S. FIRMS’ OPERATIONS (Reed. Feb. 28, 11.30 a.m.) NEW YORK, Feb. 27. A report by securities and exchange officials to the Federal monopoly committee on life insurance companies, recommends legislative action to compel insurance companies to free part of their vast reserves for loan to small business and the stimulation of new enterprise. The report of the Insurance section indicated that insurance company assets are available to big business only. Insurance companies select directors who are already directors of large corporations and are thus in a position to make personal gain: through dual capacity. Five of the largest companies interlock with about 780 corporations. Each director averages six directorships, some of which are banks in which the insurance com panies have large deposits. The theoretical right of policyholders in mutual insurance companies to select their officers is valueless because the directors are completely self perpetuating. It'is practically impossible to obtain an adequate idea of insurance costs because the necessary type of cost accounts are not kept. Industrial insurance sold to lowincome families is the most expensive form of life insurance available.