indemnity in the event of disability from sickness. The authority for conducting this business by corporations formed under the General Laws of this State, is not to be found in that part of Article 23 of the Code, Sec. 14 to 37 inclusive, in which the purpose for which corporations may be formed are enumerated and classified, unless it be included in Class 4, Sec. 27, which provides for the formation of fire, life, marine, accident, cattle, live stock and other insurance companies. Sec. 115 provides that every corporation formed under the provisions of this Article for the purpose of life insurance is authorized also to insure individuals against accident, but this would seem to indicate that authority for insurance against sickness was not included in the powers of a life insurance company formed under the provisions of the Article, unless expressly specified. In Sec. 128, however, as amended by the Acts of 1892 and 1894, it is provided that organizations issuing certificates for the payment of money or other benefits in the event of sickness, accident or death, or other contingency, .. but issuing no certificate for the payment of a greater sum than $1,000 upon any one life, may be formed on the mutual co-operative assessment or stock plan. No standard has been prescribed by law for determining the liability of companies granting insurance against sickness, or the amount of reserve to be held. Like the rate of mortality, the yearly rate of sickness, all experience shows, increases with advancing age. Therefore, where there is an increasing liability, with a fixed rate of premium with which to meet it, a reserve proportioned to the nature of the risk and the rate of the increase should undoubtedly be maintained. It would be advisable for legislation to be had on this subject, so that the Insurance Department may be enabled to see that companies which offer health insurance. preserve the means of meeting the obligations which they assume. There are sufficient statistics in existence, based upon the experience of friendly societies, etc., to afford a basis for estimating the average yearly rate of sickness at the several ages of life. EXAMINATIONS. In accordance with the requirements of the Statutes of Maryland, the quadrennial examinations for the purpose of ascertaining the condition of all companies and associations chartered by this State, were begun June, 1898, and completed April, 1899. This fact has been mutually beneficial to companies and associations as well as to the Department. It is gratifying to state that, in making these examinations, this Department experienced the most pleasant relations conceivable with the companies and associations; every facility. and co-operation was accorded the examiner by the officers and clerical force. It was generally admitted the examinations were beneficial, in that they were given to the public in an official form of publication. The fees charged were reasonable; in no instance was the payment of the examiner's bill objected to or even criticised. American Bonding and Trust Company: Condition as of June 1, 1898. Report filed June 28, 1898. Fidelity and Deposit Company: Report filed June 28, 1898. Condition as of June 1, 1898. Immediate Benefit Life Insurance Condition as of June 25, 1898. Report filed July 21, 1898. Maryland Life Insurance Company: Condition as of June 30, 1898. Report filed Sept. 26, 1898. Mutual Life Insurance Company: Condition as of May 31, 1898. Report filed July 14, 1898. Eureka Mutual Aid Society: Condition as of Sept. 24, 1898. Report filed Sept. 28, 1898. Baltimore Mutual Aid Society: Condition as of Oct. 1, 1898. Report filed Oct. 14, 1898. Home Friendly Society: Condition as of Jan. 1, 1899. Report filed Feb. 18, 1899. Improved Order Heptasophs: Condition as of June 25, 1898. Report filed June 30, 1898. Iron Hall of Baltimore City: Condition as of July 1, 1898. Report filed Aug. 13, 1898. Shield of Honor: Condition as of Aug. 19, 1898. Report filed Aug. 20, 1898. Fraternal Legion of Baltimore: Condition as of Aug. 24, 1898. Report filed Aug. 29, 1898. Order of Columbus: Condition as of Aug. 29, 1898. Report filed Aug. 31, 1898. Ancient Order of United Workmen (Maryland Jurisdiction): Condition as of Aug. 31, 1898. Report filed Sept. 7, 1898. Order of the Golden Chain (Period from Jan. 1, 1898, to July 16, 1898): Condition as of Sept. 14, 1898. Report filed Sept. 20, 1898. Maryland Fire Insurance Company: Condition as of Sept. 30, 1898. Report filed Oct. 24, 1898. Peabody Fire Insurance Company: Condition as of Jan. 1, 1899. Report filed Mar. 1, 1899. Baltimore Fire Insurance Company: Condition as of Jan. 1, 1899. Report filed Mar. 7, 1899. Firemen's Fire Insurance Company: Condition as of Jan. 1, 1899. Report filed Mar. 13, 1899. Home Fire Insurance Company: Condition as of Jan. 1, 1899. Report filed Mar. 23, 1899. American Fire Insurance Company: Condition as of Jan. 1, 1899. Report filed Mar. 29, 1899. Old Town Fire Insurance Company: Condition as of Jan. 1, 1899. Report filed April 6, 1899. Baltimore Equitable Society: Condition as of Jan. 1, 1899. German-American Fire Insurance Report filed April 15, 1899. Condition as of Jan. 1, 1899. Report filed April 20, 1899. German Fire Insurance Company: Condition as of Jan. 1, 1899. Report filed April 29, 1899. LEGISLATION. In my preceding report I briefly outlined such legislation. as I had endeavored to have enacted as amendments to the Insurance Laws of this State; again I am compelled to urge upon you the absolute necessity for a thorough revision of these laws. I recommend that a commission be appointed by you, including the Counsel of this Department and the Insurance Commissioner, who shall prepare for submission to the next General Assembly such a revision as above indicated. The defects of the present law are glaring; it requires but little experience and examination to be persuaded of the necessity of this revision. I am convinced if the Legislature would take action in this direction insurance legislation would result that would afford greater protection to the citizens of this State and facilitate the transaction of business in this Department. OVERHEAD WRITING IN MARYLAND. Under date of September 6, 1898, this Department circularized as follows all companies authorized to transact business in this State: "Complaint is being made to this Department that unlicensed insurance companies are doing business in this State, and thereby depriving the State of revenue which it. should receive and obtaining profits of business which should go to companies that comply with the insurance laws. There is ample provision in the insurance laws of this State for the punishment of unlicensed agents and companies if they are detected." I am constantly calling the attention of the public to this insecure and fraudulent character of insurance. I believe this notice has resulted in diminishing to some extent this imposition upon our citizens. It is the determination of this Department not to relax any effort in endeavoring to prevent overhead wiring in this State by detecting all persons who violate the law in this respect. RESIDENT AGENT'S LAW. Under date of November 3, 1898, this Department issued the following circular: "Although there is no Resident Agent's Law in the Statutes of this State, yet there is ample provision for the collection of taxes on all premiums collected, as contained in Section 126, etc. "Information is from time to time being received by this Department where the home offices are writing business and collecting premiums direct, the same not being received through their agents, "In some instances I have made demand for said taxes and received same, but desire to inform you that I cannot continue this procedure. In the event this letter is applicable to your company, I request you to include all premiums. received or secured in this State, or from residents thereof, in annual statement under oath filed with this Department. Failure to comply with this request, and upon satisfactory information by this Department of such violation, I am compelled to examine the books and records of your company, collect the expense of examination, and revoke the license of an offending company." There is no diversity of opinion as to the demoralization in the practice by any company of writing over the head of the agent. The agent is interested in the risks in his field, and is entitled to his share of the premiums, and good agents are often lost to the companies by this disregard of their rights. Many of the States have legislated on this matter, not so much in the interest of the agent, but due to the fact that they lose the tax, and are further bounden to protect law-abiding companies which make an honest return on all premiums collected, and do not seek to evade the law. FINANCES OF THE DEPARTMENT. The receipts of the Department for the year 1898 were $181,734.28, of which $157,692.58 was derived from taxes and licenses, $24,041.70 from fees. The gross receipts were |