The south-western. [volume] (Shreveport, La.) 1852-1870, 1867-04-17
Tf1s11ranna RoEer

Insurance must be honest Or dishonest if the lat
ter then it is a crime which every honest company
should make it special duty to expose and lash out
of existence. Insurance is the receipt Of given
for which the Insurer promises to pay the insured
another sum in case Of loss by fire. The profit is in
the receiving OF premiums which exceed the average
risk Of losses An insurance company, above all
other institutions. should be conducted and managed
with integrity. The entire property and business Of
frequently dependent upon the responsibility
and integrity of the company in which that property
is insured. 1t is to the interest of the insured well
rs Of the company, that the rules of Insurance should
be such to enable the company to MAINTAIN against
ordinary calamity its ability to pay the losses of those
holding its policies A company that takes risks at
rate below that which will compensate and protect the
company from the average losses of ordinary sea-
son, is not safe company in which to hold stock or
to be insured. man who purchases goods time
and converts them into cash at prices below cost will
even while supposng he intends no dishonesty in a
very short time be unable to pay his creditors. An
insurance company that takes risks at one per cent
when rate Of two per cent is necessary to protect
it against the average losses Of theyea will Of
sity be out Of pocket the extent of fifty per cent
of its earnings at the end of the year, and insurers
WILL in duty to themselves avoid doing business with
a company that voluntarily assumes risks which, if it
intends to pay at all, only be paid by continually
exhausting its capital Insurers who know the facts
will avoid the sinking ship.
An honest man seeking Insurance, will always find
it to his interest to take policy in that COMPANY
whose rates sufficiently high to enable it to pay all
ordinary and average losses from its earnings leaving
its capital to meet unusual calamity. He feels that
companies who do business upon any other system
of course must be that its collapse is a mere
question Of time, and that it must explode upon the
occurrence Of the first serious loss.
The public will not insure if they have no co1f- |
dence in the general responsibility Of insurance com
panes. Compromising rates, therefore, are necessary
to the soivency of insurance companies, and equally
to the retaining Of public confidence. As no sane
man would deposit bis money in bank which offered
to pay ten per cent interest its deposits because
bank could pay that interest and ever refund the
principal; so the public will have any conf |
dence in Insurance companies when the latter seek
risks at rates which protection against loss but
which certain to prove ruinous.
1t is folly, then, for insurance companies Or per
sons seeking insurance, to think Of which are
not compromising, and sufficient to cover the ordinary
average losses Of business season. Insurance com
panes cannot do honest business on any other sys
tenn and those seeking insurance, when they under
stand that such rates necessary to make insurance
of any value at all, will readily comply with an in
which is much for their protection az it is Of
those companies which take risks expecting to pay the
losses.