Thousands of N.Y. Policy Holders in Danger Because Their Insurance Firms Are on Arab Blacklist

The Arab black-listing of 12 insurance companies chartered or licensed to do business in New York State threatens the financial security of tens of thousands of New Yorkers who hold policies issued by these companies, the American Jewish Congress charged. The warning was contained in a letter to New York State Superintendent of Insurance Thomas Harnett made public yesterday at a meeting of the organization’s policy-making National Governing Council.

Jack M. Elkin, chairman of the AJ Congress’ New York Metropolitan Council, urged Harnett to move promptly to protect policy-holders of 12 insurance companies named on a blacklist prepared by Saudi Arabia. The Saudi blacklist is regarded as the most authoritative compilation of American and other companies barred from doing business with the Arab world.

The 12 companies barred from insuring Arab cargoes shipped from New York are: Citadel Life Insurance Co. of New York; The Home Insurance Co.; Massachusetts Mutual Life Insurance Co.; New England Mutual Life Insurance Co.; Penn Mutual Life Insurance; Phoenix Assurance Co.; State Mutual Life Assurance Co. of America; Phoenix Mutual Life Insurance Co.; Connecticut General Life Insurance Co.; Mutual Life Insurance Co. of New York; Provident Mutual Life Insurance of Philadelphia; and Aetna Life and Casualty, Hartford, Connecticut.

NINE ADDITIONAL FIRMS LISTED

In addition to these 12, nine other insurance companies chartered by or doing business in New York were identified by name in a document issued last year by the Doha office of the First National City Bank in the Arab oil-producing state of Qatar, Elkin wrote. The document, on the bank’s letterhead in Qatar, said:

“Please be advised that the insurance companies listed below are blacklisted by the Israel (sic) Boycott Offices and in consequence no insurance policies or certificates issued by them can be accepted by us. This list therefore forms an integral part of the terms of our above-mentioned credit.”

The nine additional companies listed by the Qatar branch of the First National City Bank are Brager and Co. (Harry Brager Co.); Cross Country Life Insurance Co.; Keck M. and Co., Inc.; Monarch Fire Insurance Co.; The American Road Insurance Co.; Fidelity General Life Insurance Co.; Ford Life Insurance Co.; Merit, Chapman and Scott Corp.; and The Aetna Casualty and Surety Co., Hartford, Conn.

BANKS AS BOYCOTT ‘ENFORCERS’

In his letter to Harnett, Elkin declared: “The letters of credit issued by buyers in Qatar who blacklist the insurance companies named above are processed by New York banks. These banks serve as ‘enforcers’ of the blacklist by refusing payment against letters of credit issued by Arab buyers unless the American shipper certifies that the ordered goods were not insured by a blacklisted company.

“The use of such a blacklist is not merely repugnant to American principles of free trade and non-discrimination; it is also a direct threat and to the solvency of insurance companies regulated by you, directly affecting their financial health and thus jeopardizing the financial security of tens of thousands of citizens of this state who hold policies issued by these companies.”

In addition to the First National City Bank, Elkin said the following New York banks were identified by the House Committee on Government Operations on Sept. 23, 1976, as processing such letters of credit: Manufacturers Hanover Trust Co., Bankers Trust Co., Chemical Bank, Irving Trust Co., Morgan Guaranty Trust Co., European-American Bank and Trust Co. Elkin said he had written Harnett on March 28. No acknowledgement or reply has yet been received, he said.