The Armstrong Committee , formally the Joint Committee of the Senate and Assembly of the State of New York to Investigate and Examine into the Business and Affairs of Life Insurance Companies Doing Business in the State of New York was an investigation begun in late 1905 when the New York State Legislature initiated an investigation of the life insurance companies operating in New York.
16-568: The Equitable Life Assurance Society of the United States had grown to be one of the largest insurance companies in the United States, with over $ 1 billion in assets around 1900. After continued elaborate activities by the executives at the company, allegations of corruption occurred. The investigation by the New York Insurance Department began after an accumulation of complaints by consumers and other insurers, and
32-698: A 1905 investigation led by Charles Evans Hughes . The investigation, known as the " Armstrong Investigation ", led to the passage of a law that set forth a series of reforms, including mandatory periodic examinations of all life insurers. During the Great Depression , the Insurance Department promoted new rules clarifying insurer investment requirements, setting more equitable determination of cash surrender values and forfeitures, and recognizing up-to-date values and improvements in mortality tables. They also carried out liquidations, such as
48-673: A report highlighting a number of questionable practices. The legislature in New York and several other states adopted many of the recommendations, including a restriction on policies with lengthy deferred payouts, including the 19th century version of tontines . The report also recommended a prohibition on political campaign contributions by such corporations. It is credited with launching the political career of Charles Evans Hughes . It conducted 51 investigatory sessions and its recommendations were incorporated into eight New York State statutes . Numerous other states soon followed suit. A tontine
64-434: Is an investment plan for raising capital in which each subscriber pays an agreed sum into the fund, and thereafter receives an annuity. As members die, their shares devolve to the other participants, and so the value of each annuity increases. On the death of the last member, the scheme is wound up. After an initial introduction in 1868 in the United States, they soon grew in popularity, to the point that by 1905, two-thirds of
80-900: The New York State Banking Department and created the New York State Department of Financial Services . Until 1849, insurance companies doing business in New York State were chartered by special acts of the New York State Legislature . In 1849, the Legislature passed a law requiring prospective insurance companies to file incorporation papers with the New York Secretary of State . The law also vested regulatory power over insurance companies with
96-696: The New York State Department of Financial Services . James J. Wrynn was the fortieth and last Superintendent of Insurance. Following the creation of the New York Department of Financial Services Benjamin Lawsky (2011–2015) and Maria Vullo (2016--) were each appointed and confirmed as Superintendent of Financial Services thereby assuming the powers and duties formerly held by the Superintendent of Insurance. Home Life Insurance Company Too Many Requests If you report this error to
112-596: The September 11, 2001 terrorist attacks. During the financial crisis of 2008, the Insurance Department helped stabilize financial guaranty insurers and worked with federal regulators to ensure that AIG did not collapse when it experienced a liquidity crisis. In 2011, Governor Andrew M. Cuomo and the New York State Legislature consolidated the New York State Insurance Department and the New York State Banking Department and created
128-585: The State Comptroller , who was authorized to require the companies to submit annual financial statements and to deny a company the right to operate if capital securities and investments did not remain secure. In 1859, the New York State Legislature created the New York State Insurance Department, and assumed the functions of the Comptroller and Secretary of State relating to insurance. The department began operations in 1860 and William F. Barnes
144-502: The 1934 liquidation of the Consolidated Indemnity and Insurance Company . After World War II , the Insurance Department pioneered many consumer protections, including comprehensive mandated health insurance benefits, open enrollment, and prohibitions against insurers arbitrarily dropping an individual's health insurance coverage. The New York State Insurance Department was the first insurance department or agency in
160-538: The United States to establish a capital markets group to examine and measure the risks in insurer investment practices, and was the first state to recognize the importance of segregating multiple lines insurance from financial guaranty insurance as a means of preventing systemic risk. In 2001, New York was the first state to establish an Insurance Emergency Operations Center ("IEOC"), which was designed to accelerate disaster assessments and expedite claims payments to disaster victims. The IEOC helped New Yorkers recover from
176-537: The insurance industry, New York State Superintendent George W. Miller, in 1871, invited the heads of insurance departments or agencies from other states to meet in New York to strive for more uniform regulation. Eighteen states met that year for the first session of what is now the National Association of Insurance Commissioners ("NAIC"). Mismanagement in the life insurance business, including exorbitant salaries and questionable investments, resulted in
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#1732779928988192-494: The life insurance in the United States was in the form of tontines. Tontine insurance was first developed in the United States by Sheppard Homans , an actuary of The Equitable Life Assurance Society of the United States. New York Insurance Department The New York State Insurance Department (NYSID) was the state agency responsible for supervising and regulating all insurance business in New York State . It
208-472: The symptoms. Complete mutualization, to be paid for at a price only commensurate with its dividends is, in my opinion, the only sure measure of relief." The findings led to the creation of the Armstrong Commission to investigate such practices across the industry. Spearheaded by William Armstrong , a State Senator, the commission began work in 1905. The Armstrong Committee eventually issued
224-411: Was catalyzed by rumors that James Hazen Hyde , a vice president and expected next corporate president of The Equitable Life Assurance Society of the United States , had charged the expense of an immense costume ball that year to the corporate account. The investigation uncovered a series of corrupt practices used by the company. The report came to the conclusion that “A cancer can not be cured by treating
240-438: Was regarded in the industry as one of the most state-of-the-art insurance regulatory agencies. Continuing education for insurance professionals is regulated by each state's Department for Insurance, although there are commonalties across the states. See Insurance Continuing Education . Effective October 3, 2011, Governor Andrew Cuomo and the New York State Legislature consolidated the New York State Insurance Department and
256-594: Was the first Superintendent of Insurance. The Home Life Insurance Company based in Brooklyn, New York was the first life insurer to be authorized by the newly formed New York State Insurance Department in 1860. Superintendent Barnes supervised the filings of 155 fire insurance companies and 16 life insurance companies during his first year in office. By the 1870s, each state regulated insurance in some manner and most had an insurance department or agency. However, because different state requirements led to confusion in
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