Papers Relating to the Foreign Relations of the United States, With the Annual Message of the President, Transmitted to Congress December 2, 1895, Part I
Mr. Olney to Mr. Runyon.
Washington, December 7, 1895.
Sir: Inclosed please find copy of letter to this Department from the governor of New York, together with copy of letter from James F. Pierce, superintendent of insurance of the State of New York, to the minister of the interior of the Kingdom of Prussia, and copy of letter from the superintendent of insurance of the State of Missouri to Theodore W. Letton, manager of the Prussian National Insurance Company of Stettin, Prussia. You are requested to use your best efforts in such manner as you may deem appropriate and expedient to accomplish the purposes stated in the letter of the governor and of the superintendent of insurance of the State of New York, and to report your action from time to time to this Department.
Respectfully, yours,
Governor Morton to Mr. Olney.
Albany, December 3, 1895. (Received December 5.)
Sir: It is represented to me by the superintendent of insurance of the State of New York, the officer charged by our laws with supervision of the business of insurance and of the companies transacting that business within this State, that three of the principal life insurance companies of New York, which are among the most important and substantial financial corporations of the United States and of the world, have been, by the department of the interior of the Kingdom of Prussia, unjustly excluded from that Kingdom, after they had been induced to establish agencies and make large investment of funds among its people. A great and growing feeling of irritation upon this subject exists among the vast insurance interests of this country, and is finding daily expression in the press. In several States of the Union notice has already been given to corporations of Prussia that they can not transact business within those States, this action having been taken by the several insurance departments solely as retaliation for arbitrary acts of the Prussian minister toward companies of New York.
The superintendent of this State believes that the shortest way to the reestablishment of reciprocal business relations among these States and corporations is to be found in a candid comparison of views, rather than in a policy of annoyance and exclusion. In this belief the superintendent has prepared a letter, addressed to his excellency the minister of the interior of the Kingdom of Prussia, a copy of which is inclosed herewith. But as the people of no State have diplomatic relations with the Kingdom of Prussia save as they are represented by the General Government, and by its ambassador to the Empire of Germany, and as I am informed that our ambassador has already in several instances, under instructions from your Department, rendered his good offices in the endeavor to solve some of the very questions now involved, I beg respectfully to request that the purpose of the superintendent in this communication be facilitated by the good offices of the ambassador of the United States in Berlin, in such manner and to such extent as shall to you appear useful and proper.
I have, etc.,
Governor of New York
The Superintendent of Insurance of New York to the Prussian Minister of the Interior.
Albany, November 27, 1895.
The undersigned, the superintendent of insurance of the State of New York, begs to present to your excellency, in behalf of this State and its people, their respectful protest against the recent orders by which your excellency has required of three life insurance corporations created by this State, that they divide their surplus in accordance with certain imaginary groups, founded upon a theory of tontine insurance which is unknown to the laws of this State and to the practice of its institutions. [Page 447] This protest seems to me to be required first by the fact that the method of accounting and distributing referred to, and by a decree issued in your excellency’s name made, a condition of the continuance by these companies of business in the Kingdom of Prussia, is inconsistent with the principles upon which the companies are founded and conducted, and in violation of the laws of this State; and by the further fact that the authority of the wisest and best recognized actuaries of the world is substantially unanimous in condemnation of the scheme.
No reputable actuary, so far as I am able to learn, has ever advocated such a method as essential, and the large majority of actuaries regard it as unwise and unreasonable.
The complaint of the companies in question is that this requirement has been adopted in pursuance of a fixed purpose to exclude these companies from the Kingdom of Prussia and not from regard for principle nor from a desire to protect insurers. After careful examination of the records in possession of the companies and of all the circumstances of the case, I am forced to the conclusion that this complaint is well founded. It has further been proved to me beyond dispute that reasonable and respectful requests presented by one or more of these companies for a hearing before proper authorities of your department have been refused, or at least rejected without the courtesy of a refusal.
Inasmuch as the policy of the State of New York has always been to treat insurance corporations of every other state or country with the same courtesy and hospitality which are extended by such state or country to our own companies, and inasmuch as the law vests in me without appeal discretionary power to refuse to corporations from any foreign country the privilege of doing business in the State of New York, when such privilege appears inconsistent with the public welfare, it may become my duty to suspend the consideration of applications from companies of the Kingdom of Prussia for the privilege of doing an insurance business in this State, unless the Government of Prussia shall see fit to extend similar privileges to corporations of the highest standing created by this State, or else shall explain its action in refusing such privilege in a manner consistent with the courtesy and liberal policy which have heretofore guided the relations of this State and its business enterprises with the governments and corporations of European States. In the early weeks of the coming year, the companies created by the Kingdom of Prussia, and already doing an insurance business in the State of New York will reach the end of the term for which their concession to do such business has been granted. Unless that concession is renewed by me, their right to do business here will terminate. It may then be impossible for me to continue the privilege they have heretofore enjoyed, or to admit other Prussian companies to do business here until the conditions mentioned above shall be fulfilled.
I beg, however, to assure your excellency that it is only with extreme reluctance that I shall resort to such measures. Observing that my respected friend, Mr. Waddill, commissioner of the State of Missouri, has already taken the decisive step of excluding from that State the Prussian National Insurance Company of Stettin, solely because of the apparent injustice done to the companies of New York in your excellency’s name, I can not permit the authority of this State to seem more indifferent to the welfare and honor of American enterprise as represented by its own institutions, than is a sister Commonwealth which has no corporations that are open to attack or injury from foreign Governments. Yet it seems to me most respectful to your excellency, and most likely to conduce to a good understanding among all parties concerned, before proceeding to an extreme step, to ask your excellency’s attention to the grave facts which I have stated, and to submit for your information a copy of the letter sent to the Prussian National Insurance Company of Stettin by the superintendent of insurance of Missouri, as an expression of the sentiments which I believe actuate all intelligent Americans upon hearing of the policy of your Government.
I am equally confident they all, in common with myself, will highly appreciate any effort your excellency may make to restore reciprocal feelings of courtesy and promote the mutual enjoyment of reasonable privileges of trade between the citizens of Prussia and those of New York. I beg your excellency to accept the assurance of my distinguished consideration, etc.
Superintendent of Insurance of the State of New York
The Superintendent of Insurance of Missouri to the Prussian National Insurance Company of Stettin.
St. Louis, November 18, 1895.
Dear Sir: As superintendent of the insurance department of the State of Missouri, in the United States of America, clothed with the power of granting or refusing to [Page 448] grant insurance companies of other States and foreign Governments authority to do business in the State of Missouri, my attention has been called to the action of the Prussian Government, in the German Empire, in forcing American insurance companies which had been admitted to do business in that country to abandon their business and withdraw from Prussia. I have looked into the matter with much care and with a great desire to find some way by which I could escape the disagreeable duty of refusing to companies of Prussia the right to do business in the State of Missouri. I have carefully gone over the correspondence, orders, rules, requirements, and other obstructive measures had and made by the Prussian Government with one of the great American companies which has been forced to leave Prussia.
After carefully considering all these documents and correspondence, I am forced to the conclusion that the deliberate purpose of the Prussian minister was to force the American life insurance companies doing business in Prussia to withdraw their business from that Government. The correspondence discloses that the minister only made requirements; but it also discloses that as soon as one difficult requirement was complied with another was made upon the company, and when that was met another still more difficult was made; and so on, until it was made manifest and beyond question that the Prussian Government, through its minister, was determined to force the American companies to abandon their business in Prussia. It has succeeded, and the Equitable Life Assurance Society, the Mutual Life Insurance Company, and the New York Life Insurance Company, all American companies, have each successively been compelled to withdraw their business from Prussia at great loss. It is easy to see through the filmy meshes of sophistry with which the Prussian minister seeks to cover up this transaction, and make it appear that the companies refused to comply with the requirements of the Prussian Government. It is equally apparent that the requirements were made successively with the deliberate and fixed purpose of forcing the companies to abandon Prussia.
As an American citizen, and as an official of a sovereign State of the United States, clothed with authority to superintend and supervise all matters of insurance companies doing business in the State of Missouri, including the authority to admit them to this State, and backed up by the retaliatory statutes of the State of Missouri, which require me to mete out to companies of other States and Governments the same treatment that those States or Governments mete out to companies that are foreign to them, I shall be compelled to deal with companies of Prussia as the Prussian Government has dealt with American companies.
I desire to call your attention thus early to this matter and to say to you in all frankness that I shall not be influenced one moment by the diplomatic veneering and sophistry of the Prussian minister, and that unless this action of the Prussian Government is modified and just treatment is accorded to American companies having large interests in Prussia and other parts of the German Empire, it is now my purpose to refuse to insurance companies of Prussia a renewal of their authority to do business in the State of Missouri on the 1st of next February, when their present authority will expire.
I have to express the hope that before that time such action may be had and such reconsideration made as that the Prussian Government will have revoked its harsh orders and extended to American companies such a liberal policy as will enable them to continue to transact their business within its jurisdiction, and that I may thus be saved the disagreeable duty of enforcing the strong measure which I have now in contemplation, and which I have above indicated.
I am, etc.,
Superintendent
Mr. Theodore W. Letton,
Manager Prussian National Insurance Company of
Stettin, Prussia,
Chicago, III.