The New York herald., 1872-12-02


REcEIvERsHIPs.
The matter OF receiverships is exciting especial
attention at the present moment The New York
Board OF Fire Underwriters has adopted resolu-
tons to the effect that, in It's judgment, the laws
OF this State, requiring olicia examination by the
superintendent of the Insurance Department, pro-
vldes the proper mode of ascertaining the actual
condition ofthe companies and that the exercise OF
the powers thus granted affords ample protection to
the rights Of policy-holders, and at the same time
secures In the best possible manner the rights OF
claimants and the interests Of the stockholders;
that while this Board recognizes 1t as proper that
the judicial authorities should, on the complaint
OF claimant for loss, or Of individual stockholders
take action enjoining an insurance company
from continuing its business and appointing re-
ment Of the company arises from fraud or incom-
potency, its members hereby declare that when
company becomes embarrassed In consequence OF
extensive confagrati0ns, as at Boston and In other
cites any such action becomes an act OF injustice
and Is contrary, as experience mas proved, to the
best interests OF claimants and stockholders which,
with respect to economy and expedition In closing
up its affairs, have heretofore been best promoted
by judicial action, taken at the instance Of the
Board Of Directors Of the company, and Dy the ap-
pointment OF receiver nominated by such Board |;
and that any judicial action taken with regard to
insurance company upon the er-parte statement OF
any claimant, stockhoder or officer, when the CON-
pany either actually becomes or Is supposed to be
embarrassed, while h0norably pursuing It's business
by the occurrence OF sucn res as have taken place
within the past fifteen months, would innict o
wrong upon the company and upon Its honest
claimants and stockholders, and is liable to involve
substantial companies in serious loss, and in some
IN dtuao and han r.
ruptcy. In commenting on these resolutions, the
Chronicle, leading and lively insurance paper,
says that "this action Of the New York Board
ought to put an end to the disgraceful proceedings
which have characterized the winding up of many
insurance companies. Receiverships nave come,
in New York at least, to be the spoil OF unscrupu-
lous lawyers and hungry politicians. More frauds
and Outrages have been committed in settling the
affairs Of insolvent companies, fairly and honestly
bankrupted by the accidents Of an honorable busi-
ness, than all the wildcats have been guilty OF since
insurance began. The deceits and cheats practised
under the existing plan OF appointing receivers are
endless and infamous. For an insurance company
to be placed In receivers hands, as matters now
go, Is to bury the rights and hopes OF creditors
where even the general resurrection must have
an alterbirth to bring them to light" The editor
OF the C1s0ntcle seems to have as little confidence
cludes that the United States Court and proceed
ings in bankruptcy there appear to be the plest
safest and most honorable resort for honest bank
fupts and their creditors. In this connection 1t
may be added that on Saturday last the Boston
Board OF Trade appointed o committee to procure,
If possible, this modification OF the present practice
In respect to receivers-namey, that two receivers
be appointed Of them to be the President OF the
company and the other nominee of the creditors.
one receiver familiar with the assets oil the COM
pany and knowing how to collect them, and an.
other bound to sustain the interests Of rightful
One Of the lessons taught by the great fires at Chi
cago and Boston Is the necessity Of
PRUDENT DISTRIBUTION OF RISKS.
1t is the old warning Of the homely proverb
against putting all the eggs In one basket" In
Boston, as in Chicago, the heaviest losses fell upon
The editors Of the Spectator, ano her leading in
surance journal, I'VE believe that more than
ton oflces many Of which confined their business
exclusively to Boston, and in consequence OF this
foolish and mistaken policy are now the chief suf-
ferers. There is not much ground for hope that
single Boston fire insurance company, except the
few which wrote only dwelling risks, has escaped
losing more than its entire assets. few of these
whose prestige is OF the greatest value viii un.
doubtedly call in fresh capital and reorganize I'M
der their old names" Some OF the .placards in the
windows OF New York companies blazoning forth
such announcements as "No agency In Boston"
and the like, are maniesty bats for the gullible.
n large ire III new lOFk OF III brooklyn WOuIQ
bankrupt most OF our local companies that do, or
profess to be doing, an exclusively local business
The best Hartford companies and the best New
York companies like the best British companies.
ann to have agencies everywhere, judiciOusly dis
tributing their risks all over the world, and il
would be well II their example were more generally
followed.
ADVANCE IN RATES.
The National Board Of Fire Underwriters-Mr.
Henry A. Oakley, President-recOmmended at one
OF their sessions last week increase rates from
the standard OF 1865 and 1867 and the revision OF
fifty thousand in population, to add at least thirty
per cent to present rates, and all places having
population OF over fifty thousand to add at least
fifty per cent, 1t being understood that the Execu
tive Committee OF the National Board be empow-
cred to make exceptions and revisons In places
where adequate tariffs are now in force. The i'm
perative necessity Of an advance in the rates is
now manifest to all. 1t has always been recog-
nized by those who know anything of the scientific
and common sense basis on which fire insurance
should rest. They long. ago learned that 'cheap
insurance" Is a delusion and snare. policy
rates is too dearly bought. A fire Insurance com
pany can 0Ger no genuine security either
70 Its policy Or Its STOCKHOLDERS, when il
In sustaining its ordinary dividends and to pay It's
losses from capital and not from earnings. This is
Just what many company has hitherto been COM
PEELED to do, in consequence OF the shortsighted
sedshness OF the public in eagerly demanding
10 low ra.es, 80 caiiea Az tne siXth annual meet
April. its President asserted that, with few ex-
ceptions, the public are not willing to pay fair
II they would enjoy Its benefits. "They rather en-
courage said Mr.. Oakley, .the efforts made by
both unscrupulOus men and companies to break
down rates but we know that to secure solvency
we must place rates SO that they will yield profit
and induce capitalists to hold 1t as permanent in
yestment and not as mere venture.n Rates had
been diminished to very meagre standard when
the Chicago fire suddenly demanded $3.50 900
at the doors Of 2Ol insurance offices. The
Boston fire has now made requislion for
$4S,0O0,00o more, in addition to all the other
millions asked Tor by the thousands Of fires
0lu aid r1risr tI,sa
year. These vast sums are forcible arguments-to
many companies they have proved "knock down'
arguments-in favor OF an Indispensable advance OF
rates. A healthy competition will prevent these
rates from becoming exorbtant. But 1t is mani
Ereniag Mail says. "iust what men in every bust
ness do whenever they discover that they have
been selling valuable goods at less than cost" aud
the public for Its own interest, must concede the
necessity OF honest, paying rates.
The people are even more interested In the SOL
vency or the insurance companies than the stock
holders and directors. The companies stand in the