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J" '. 7 "( 12-THE CAROLINA TIMES SAT.. APRIL 7, 1978 t I 1 Consumers of 'Debit' Insurance Pay High Price For Low Return Purchasers of "industri al" and other types of "debit" insurance "pay more than they have to for products that do not provide them with what they need " the chairman of the Federal Trade Com mission said today, testifying before a subcommittee of the Senate Committee on the Judiciary. Consumers of such in surance are primarily "the most vulnerable groups in our society: poor people, minority people, elderly people," Chairman Michael Pertschuk told the Sub- on Anti-trust, and Business committee Monopoly, Rights. Debit typically policy under insurance is a life-insurance with a face value $5,000 and is sold tress. He suggested tives to debit "low-cost group as alterna insurance insurance, regular non-debit term or whole-life insurance, savings bank life insurance in the three states which offer it and savings banks and credit unions. Moreover," he said, "most poor people are covered under the So cial Security ....its survivor's benefits are the equivalent .of about $28,000 of life insurance coverage for men and $9,000 for women-far more protection than debit policies provide." Pertschuk also noted that the FTC could serve as an "information clearinghouse and technical advisor to the door-to-door. Premiums are generally collected weekly or monthly. The FTC recently re leased a staff report on industrial and debit in surance. "Industrial," one type of debit insurance, got its name in 19th-century England where it was sold primarily to industrial workers. More than 100 million debit policies are in force in the U.S., almost one for every two people, Per schuk noted. He place annual premiums at approx imately $3 billion. "Most consumers appear to get less insurance pro tection and savings for their premium dollar from debit insurance than from any other life insur ance or savings mechan isms," he said, adding that "this higher cost is primarily the result of the expensive door-to-door marketing and premium collection system." ' "Compared to other insurance policyholders, a disproportionate number of industrial policyholders pay in far more than they can ever get back in benefits," Pertschuk ex plained. "It appears that many industrial policyhold ers today are elderly people, usually women, who bought their policies years ago. If instead they had put their money in a bank 35 or 40 years ago, they would now have savings equal to 5 to 11 times the death benefits of their policies 'and. even more times' the cash sur render values." "The problem of low re turn on the consumer dollar is compounded by what appear to be extraordinary high early lapse or drop-out rates," he said, pointing out that "an industry-funded study admits that as many as 50 per cent or more of industiral . po licies are dropped in the first year. These high lapse rates penalize policy holders harshly, because they occur when policies have little or no cash values." Pertschuk said that "'overloading,' or selling too many polices to one customer in relation to need or ability to pay, appears to be one of the most widespread and ividious abuses." "That owning multiple policies is the rule rather than the exception is sug gested by the figures on ownership: over 100 million debit policies in force, concentrated among the low-income quarter of the population. If we assume that all debit poli cies are held by families in the $3,000 to $10,000 income bracket-the prime debit market-then each, family on average owns seven policies," he said. Pertschuk inserted into the hearing record a facsimile of a payment record book that compan ies give each policyholder. The book contained space for recording payments on 15 to 22 weekly policies and up to 7 monthly poli cies. "Some people . with multiple polices have report ed that they skimped on food to pay their prem iums. Yet with all their policies, their coverage was well below the national average," he said. Pertschuk added that "insurance on children is often sold as. a good way to me for their futures" but. that, in fact, people buying insurance for such a purpose "would have a larger nest egg if they'd buried it under the mat- states," which have primary authority over the regulation of insurance.. Among the policy options the states or the industry may wish to consider, he said, are: -Placing a limit on the amount of the consumer's premium dollar the company can retain for ex penses and profits. -Removing laws that exempt industrial insurance from consumer-protection measures that apply to ordinary policies. -Requiring that paid-up policies be issued to people who have paid in more than the face value of the policy. -increasing access to group insurance and savings. 8 Threat Anai Asido inst Gov't sot 4 f i for Minority Businesses Dropped WASHINGTON -The threat of .snatching millions of dollars from minority businesses and small firms generally through the discontinuance of setting aside or earmark ing specified portions' of federal procurement contracts for these enter prises has been dropped, White House sources revealed this week. Texas millionaire Robert S. Strauss, the Pres; dent's special ambassador for international trade ne gotiations, had proposed to abolish the set-asides for blacks and other minorities as a possible way of increas ing the exchange of business between U.S. firms and foreign manufacturers.' It is reported that Am bassador Strauss was pre paring to allow foreign manufactoers- to bid on an . estimated $10 billion in new U.S. business in exchange " for opening up opportunites for U.S. firms to bid on $25 billion worth of Euro pean business. First to react to Strauss' scheme to -undercut min orities were Congressmen Parren Mitchell of Maryland and Joseph Addabbo of New York. They have called on Rep. John' J. LaFalce, chairman of the Subcom mittee, on - General Oversight and Minority En terprise of the House Small Business Committee, to hold hearings and look into the matter. In a letter to Congress man Mitchell, following a telephone call, Ambassador Strauss assured him that SBA's 8(a) set-aside contracting arrangement for minority businesses would continue, and his negotia tions abroad would m no way involve that policy. r Joseph Louis Barrow, Jr. LOUIS' SON PROMOTED TO HIGH POST IN ENERGY DEPT. U.N. Ambassador Leslie O. Harriman WASHINGTON Joseph Louis Barrow, Jr, son of the famous Brown Bomber, has been promoted to the directorship of the Office of Commercializa tion for Conservation and Solar Applications, the U.S. Department of Energy an nounced this week. In his new position, Mr, Barrow, who has been with the agency since 1976, will be responsbile for policy direction and program assistance in the develop ment of solar energy 19th Anniversary off Sharpsville Massacre Commemorated By UN BY ANGIE DICKERSON NEW YORK (NNPA) -As the International Anti Apartheid Year drew to a close last week, the United Nations convened a solemn meeting, commemorating the 19th anniversary of the Sharpsville Massacre in which 69 were killed and hundreds wounded as they peacefully demonstrated against the hated pass-laws. This led the U.N. Securi ty Council to first consider the situation in SouthAfrica. as a threat to wotlc peace and security. In his opening remarks on the observance, Ambas sador Leslie O. Harriman of Nigeria, current president of the Security Council as well as chiamrn of the Special Committee against Apartheid, stated, "I cannot be acutely conscious, as we meet on tis solemn occasion, that the struggle against Aparth eid is the struggle for the re demption of Africa. "Through five centuries, it has suffered slavery, co lonialism, racsim and and humiliation imposed by alien settlers, freebooters and conquerors in the mnttt fiharrif fil ch&pttt in the entire human history," he declared. ' "For Africa is not free -no part of Africa is fully free - and no person of African descent can walk in full dignity so long as racist domination prevails in the southern part of the continent." The speaker than out lined the role which the Se curity Council has played regarding the Apartheid sys tem of South Africa, in cluding the various resolu tions adopted by it. He indicated that the body is presently considering yet another complaint of aggression against South Africa. Referring to the work of the Special Committee Against Apartheid, Ambassador Harriman expressed thanks to all gov ernments, organizations and individuals who , had been helpful in making the world aware ot the need to isolate the Apartheid South African regime and to assist in the tibteatioft sttuggj.-. ,. Inspired by the -achiev ments of the Anti-Apartheid Year, the Committee used this occasion to launch the INTERNATIONAL MOBILIZATION against apartheid a mobili zation of governments and peoples for the destruction of racism. This reporter was grant ed an interview by Ambassa dor Harriman following the U.N. meeting. He explained that the reports of many seminars, international conferences and demonstra tive actions regarding bank loans to South Africa,' militar and nuclear buildup in South Africa, and the demand for trans national corporations to end their collaboration with the racist regime, had been broadcast throughout the world and still are beamed to South Africa at a ratel of 30 hours per week. 1 processes that are ready for adoption by private industry. Prior to his new appoint ment,. Mr. Barrow was a special, assistant in Energy for marketing and finance research. -He . joined 'the agency through the President's Executive Interchange Program. The former World Heavy weight Champion's son came to the attention of the President's Executive Inter change Program while serv ing as assistant vice-president of the United Bank of Denver where he worked in the trust divi sion and ' ' managed motor vehicle it.. y Mr. Barrow joined the bank upon graduation as a political science major at the , University of Denver in 1968. Officials of the Depart ment, of Energy point out that solar energy offers one of the best options for meeting the world's energy needs. PRE-IUSINESS SEMINARS AND WORKSHOPS conducted by Dr. John Ezell Stewart Founder and President Chief Executive Officer of the UNITED MINORITY BUSINESS DEVELOPMENT ASSOCIATION Consultants USA - International and Rev. Dr. Elsie Stewart, Executive Director, Women's Division. TOPIC OUTLINE of format to be covered in each session: I. 2. 3. 4. Programming your sub-conscious mind for increased enthusiasm and self improvement. , The importance of an effective business plan. Type Of Insurance; A. PersonalFamily B. Business Executives Developing more business through increased telephone effectiveness. U.M.B.D. A provides expertise for the following areas of concern. A. Minority Products Sales Procurement Contracts. B. Sales and Management Training Programs for Potential Executives. C. In Company Employee Training Program. D. Proposal Writing and Development For Educational Programs. E. Consultant Lecture Participation for Special Projects and Programs for Industry and Educational Institutions. SEMINARS WILL BE HELD ON THE FOLLOWING SATURDAYS April 7, 44, 21, and 28 May 5 and 12 Time-8:00 p.m. -10:00 p.m. Each Session Required Attendance- 3 of 4 meetings to receive certificate of participation To Enroll Call 919 286-3622 or Write, Post Office Box 2553 Durham, N.C 27705 Seminars Will Be Held At: Ramada Inn Downtown - 1-40 at Duke Street TH (HI R R D ! TO N'S -OTT LACQSTC THE LACOSTE BLAZER IS GOING PLACES THIS SPRING! Tailored to Unp pace with the urcesslul man's busy schedule, the Lacoste Blaer is a blend of rare Alpaca, fine wool and pol yester. Indisputably, a fine jacket tor the man who insists on rual il. I he golden buttons carrv the alligator symbol. . Tharrington's has the lacoste Blazer in a good selection of colors. $125.' OpwiWMlidayt until 9 pm, Uw Our $in-Mnfh Qmf Plan of Yur tank Chorj. Card. NOfilHGAFE Sears SAVE mi Sears Best Easy-Flex Leather Shoes. ..need no breaking in! U l Sole is attached to upper sC y ( .VSgST 'A in -pecial wy that ve. ffTf (S'jX c '42 X?f Sears INCOnf TTK SERVICE v hhi too? Notice the fine details that have gone into the construction of our Easy-Flex shoes. Not only do you get style and long wear, but comfort, too. Take advantage of the savings now! Available in D widths. A. $47 Brown or Black Slip-ons .. $37 pr. B. $48 Brown Slip-ons $38 pr. C. $52 Brown Boots with Zipper. $42 pr. Ask about Sears Credit Plans Sale ends March 24 SHOP YOUR NEAREST SEARS RETAIL STORE N.C; Asheville. Durham, Fayetteville. Greensboro, Raleigh, Wilmington, Winston-Salem. S.C.: Charleston, Columbia Va: Roanoke Sears Where America shops BEARS. ROEBUCK AND CO. Satisfaction Guaranteed or Your Money Back NORTHGATEMAE& Open Monday thru Saturday, 9:30AM'tiI9:t)0PM.
The Carolina Times (Durham, N.C.)
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April 7, 1979, edition 1
12
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