The Camden journal. [volume] (Camden, S.C.) 1866-1891, 1871-02-23
I,ifa Assurance.

1tutpai Lille anu Ine IL aIiHSIS anu
Mechanics Life'-have attracted much
public attention. - -
These failures do not surprise re.
flectipg insurance men. The organi-
cation of new companies in that city
has been Of late years at the rate OF
moro than one every two months, no
less than nine having been organ
lied in 1870. Too many Of these en-
terpriscs were started. as private specu-
lations, with little or no regard to pub
lie utility. The special end and aim
was to furnish. official position and sala.
ries to men, too often over ambitious,
frequently incompetent, and sometimes
dishonest.
The, in some respects, excellent artl>
Gle you copied a few days since from
the Baltimore Sun, is in error in say.
ing that the "Great Western" was one
of the "youngest, smallest, and least
successful OF its class" 1t was organ
lied in 1865. There are nearly thirty
Companies its "Juniors. At the end
of 1863 only one of its compeers had
outstripped it in the race for business,
and it had passed by several of its use.
niors." We do not bclive that any Of
its three thousand policy holders
think it was TOO small Neither
its youth, size, nor even competition
(of necessity,) had ausht to do with its
failure; some ofits "Juniors" are remark
ably successful, and are conducting their
business on sound principles.
The failure of the "Great Western"
vas owing to the t'ncoapeteny of its
officials. There does not seem to have
been any fraud on their part. Its tables
allowed loading of 30 per cent. on net
premiums for expense of management.
ln 1869 it expended so per cent. of
income on this account, and paid on
death claims only II J per cent. OF in
come, being less than was paid h1 .Ss ..s
"Mutual Life. Of ,'sw Ne York, aud 6 per
Cent. less than was paid by the "Equi.
table on same account, aid 4 per cent.
less than the average of Companies of
its own age. Among its assets SO per
cent. is reported as due from agents,
and nearly the same proportion is rep
resented by "premium notes" and
'Hoans on policies" Among its lia.
bilities 100000 are reported as educ to
agents on account of commissions. -
We have given these details in order
to show that its failure was not the re-
suft of excess of mortality but vas
owing to Observation-Disclosures
ment of such a kind that the mcrest
tyro in business might have avoided.
The failure Of the Farmers and
Mechanics" was owing to fraud from
beginning to end. The Superintendent
of Iusurnce says that a large number Of
false or fictitious entries were made of
policies that were never issued nor even
applied for. The expenses CT the Com.
pany from the frst were enormously y
large and entirely disproportiouate to
the business done.
In fifteen months s6S,000 were ex-
pended for advertising, printing and
stationery. Salaries aud commissions
allowed officers and agents were on q
scale that no young Company could
stand.
The New York Underwater, for De-
cembcr, says:
awe have other Companies which,
as respects available means for reinsu-
ring their policies, are no more solvent
than the "Grcat Wcstern," and sug-
gcsts "that all such paper item Com
panics set their houses in order aud
henceforth be prepared with us much
realized assets veil in hand, as shall be
equal 70 the reinsurance liability"
We venture to add that among them
the editor would include some of the
"old and large" companies, the writer
of the article in tie Baltimore Sun to
the contrary Notwithstanding.
We think the article from the Bal
timore Sun tends to an unfair discrim-
ination in favor Of old as against new
companies. As far as unhealthy in
crease of business in question, the sin
is not confined to the doings of the
young companies. We give below a
tabular statement Of losses on tlie new
business of six leading oil and young
companies in New York, (oluitting
names,) compiled from tabular state.
mert published by the Insurance Times,
Of New York City, which Was made
from the sworn reports of the compa-
nies to the Massachusetts, insurance
for 1SG7-'S and 9.
Ratio Of losses on ncp policies issued,
in decimals Of per cent:
Age IF Years of
Companies. Issue.
81. '6S. 'G9. AV.
26 years. 10 ~ .13 .lS nearly, or 81 in each
S763 at risk.
"a years. .4S .25 .35 81 27O at
risk.
10 years .26 10 SO .26 " 3Si at
risk.
years .05 .07 .05 .0G " 1866 Mt
risk.
years 10 .0S .05 .03 ,425 at
risk.
2 years IA IA IA ia at
risk.