Methods of Northwestern Mutua of Seattle, Wash., Exposed. Underwriters' Ileport of February 4, 1916. Tho Callfornln state Insurance department de-partment has refused to Issue a II-censo II-censo to tho Northwestern Mutual Flro association of Bcnttle, holding that tho company has deceived property owners by falsely claiming that tho policies It Issues arc nonassessable. non-assessable. The California department depart-ment also charges that the mutual s reserves aro Insufficient and that II has foiled to observe tho California requirement to print Its bylaws In tho policy. The department has had tho mftUcr under Investigation for six months, the license under which tho company formerly operated hnv-Ing hnv-Ing expired June 30th of last car, I in mil From t'tnli AIm. The charges made by the California Califor-nia department nre similar to thoso mndo against the Northwestern Mutual Mu-tual by tho Utah Insurance department depart-ment last year, which aUo refused to Isauo the compnny n license The Utah department nlso charged tho compnny with making a false statement state-ment or Its financial condition, pail ding Its assets with worthless securities. se-curities. After being denied a II-coiuwj II-coiuwj for a number of months, the mutunl was rollccnscd by Utah on n shoring thnt'the company wns solvent sol-vent under tho Utah requirement Ulcer Clear uf (Vurt. It tins been known for some Unto that tho Northwestern Mutual wbs In trouble with tho California de- Commissioner I'helps' reasons for refusing n llcenn' to the Northwestern Mutual aro three In number; First That the company .misrepresents the chnrncter of Its policy contracts by clnlmltig thnt the policy Is non-assessable. Second thnt the company does not maintain sufficient reserves to carry Ha policies to expiration. Third Tho compnny violates tho California law In falling to print Ita bylnw'A on each policy Issued. pnrt men t which It Is stated has refused re-fused to license tho company slnro July 1st of last year Strenuous effort ef-fort have been rando by tho mutual company officers to secure the desired de-sired authority, but Commlsiloner rholpa hits Insisted that the company's com-pany's practices nro Incompatible with sound Insurance principles, beside be-side being contrary to tho California Califor-nia laws. I'helps litis expressed a willingness to have the company refer re-fer tho question to the courts, but thus far the mutunl tins not acted on the suggestion. Fond of TechulenlltJci. While tho legal authority to operate op-erate In California has been denied tho Northwestern Mutunl since July Isst, tho compnny has continued to write policies nnd tho question Is now raised that such policies might prove valueless In the event of tho company refualng to pay when a lot ensues. Under Sec G9G of the political code, "All policies nnd other contracts of Insurance Issued without full compliance by nil pur-He pur-He concerned with tho law of this stato shall b null and void " Insurance men might point out that an unicrupulous company might cosily rnlso this point should It desire to evade the payment or a loss. In this connection It may be recalled that sevoral yeArs Ago the Northwestern Mutual, which was then active In California as on "undcrgrounder," was reported to havo forced a loss settlement with II LctI Co. of 8an Francisco by representing that as the company, then unlicensed, had violated tho California laws In Issuing tho policy tho San Fronclsco proporty owner had no standing In the California courts. It is furthor ntatcd on tho authority of tho Levi firm that tho muutal compnny Insisted on a reduction re-duction ot 12 H per cent from tho settlement modo by the regular Insurance In-surance companies, as a condition to the final sottlement, which was msdo five months after tho other companies had paid In n signed statement describing Its cxporionoo with the Northwestern Mutual, H. Levi & Co. said that the compromise comprom-ise was forced on It by the Northwestern North-western Mutual's threat that tho San Francisco firm would be com-peilcd com-peilcd to come to the company1 headquarters nt Seattle to obtain Its money IVimilM' of Saving Dliutl. The Northwestern Mutual ha been active In the Pacific Coast stales for several years, being li censed In Washington, Oregon, Idaho Ida-ho and Ilrltlsh Columbia. Complaint Com-plaint has often been mad that II secure patronng by rate cutting and representing thnt by economical management II is able to return n substantial part of the premium to polio holders, thus effecting a saving sav-ing to property owners, lusurnnco men who haw examined It plans, however, state that the alleged saving Is obtained by loading tho premium with tho sum the company subsequently returns with n flourish, flour-ish, as n socnlled dividend Kxicrt who have studied tho question hold that a comparison of the results of tho Northwestern Mutunl policies with those of the regular companies show that tho mutual policyholders' net cost Js often actually in excess of the chnrges mail by the regular companies, Simp Fur .Mutual Officer. An exhaustive examination of the company several years ago by tho Utah Iniuranc department showed that Its socalled dividend feature was arranged to Influence prospective prospec-tive Insurers, being manipulated by no company officer h -recolpt of extravagant col ' ior managing IU Sufi-ahorwn Sufi-ahorwn that tho prlnclSit V had a hAlf doxen .ourtc. J0" spnnl rovenuo through W. tlon with the company , Si " company appeared to U miT.1 namo only, since ( llfiN other lnsumnco departed. " criticised tho p7acHc k pony', officers in drawli,. urn. from Ho treasury in ,L of solarle nnd undcrwrlltni .JS 1'oUcyt.oJdem May Ife j Ono of tho objection ,u? iho California ln.ur.nS ",2 o Icenalng tho North wK?. lual is Uio practice of ren,2.! that policyholders ? aM to Assessment ns In olh companies. On tho ouuid, J f policies tho company print. iu, owing; "ThU policy pSf in tho dividend. n.lVifcS iion-AAscssnblo." 0M"' Tlmt the policies of th. sv wcatcrn Mutunl nro absolnt.i. 1 nsseiwabl Is denied by th tit. nla department which sUIm po Icyholdors may not be 1 only so long im the cornpuT! sossca n surplus nbove llablui. IBO.000 Should tho comp"n, plus Jnll below this mm x western Mutual policyholder rr bo In tho amo unhappy ft, thnt hns confronted pollcrhoUm countless other mutuals called to pay their company debts i,' sesamont. ' Will Hiirplu l)lrrr,j Another feature dovlopj h i California department Is th ,. tic of the mutunl to undmut lis unearned prwntum rtKmt !f ?.U know. this Is in Ibj 4lnblllty of nn Iniuranct tiap nnd determlniva It lolvtatr creasing th unearned prwalia serves Increases n corapBt'i AuriiluB, while nn Incretn U i former diminishes the aftJflii portlonntely. Whll th cW laws require mutunl flro cookie to maintain tho same unru4t m lum reserves as regulir ce les, tho California deptrtisnt found that tho Norhtwcsttrn Xv enters practically nil of lit v policies ns annual nnd kvsUu policies, basing Its compnUtlm Installment premium psrmMU, stead of tho full premium, u qulrwl by law Tho effort eft la to glvo tho Northwesters Minn Mi-nn xtrnordlnary ndvsnUfe i other companlea. It has been estimated tbittf mutunl charged Itself with tfc serves required by low, 1U M ties would be practically 4n-wlth 4n-wlth th result that Its prcMti plus would bo entirely wlpri With lta surplus gonr, Calk policyholders may therefor i themselvcA In a rlous prelk aa Commissioner I'helps hit 4 vl that tho company mntt rt Ha operaltono to conform viU Callfornln law.