Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1874-02-19

coast business.
Now, insurance is the protection of capital
from irredeemable loss. Insurance COM
panies. in spite of whatever preJcdlces may
exist against them among some uhreasohaoie
persons, are great public benefits. The idea
| is tight, though occasionally companies may
not be discreetly managed or there may be
undesirable companies. Yet this does not in
tile least affect the just principles upon
which insurance Is based.
How then does Maine stand as regards cap
| ital invested in insurance, and what are the
figures as TO losses and the present obligations
of the people of this State as regards insur-
ance companies!
The Insurance Commissioner report lor
! 1878 is not yet issued, so we take thst OF
| 1872. The whole amount of insurance (risks
taken) was SO, 062, 1893, OF which but Sl9,-
523,9l7 was in domestic mutuals, leaving
| $50 .53S, iSI in stock companies whose bust
ness is based upon capital. Of this amount,
$50, 722 ,S2l, or over nine 'tenths was in o.
| foreign companies Belonging out OF the
| State); the three domestic stock companies
| Bangor, Eastern and Union, all of Bangor
insuring but S3,Sl5, eco. The amount OF
premiums received in stock companies In
1872 was S.55, 359.22. OF this amount, S69o,-
| Ill SO, or over nine-tepths, was by foreign
companies belonging out Of the State); the
domestic stock companies receiving but SOU
1879. The amount of losses in Maine by
stock companies was S4l2,34GsI. VI THIS
amount, 1878, lS5, 10, or over nine-tenths, was
paid By foreign companies; the domestic COM
pspies paying but S34, l6l.6e. The amount
OF capital OF the IS foreign companies was
SIC, $50, 600, and the three domestic stock
companies 5000, 900.
| The amount of insurance taken in Maine
by foreign stock companies during the five
years from 1868 to 1872, inclusive, was S2Gi,-
| l47 ,553; premiums received, S3,237 ,5o7 oil !;
| losses paid $l.S76, 1851; averaging per
year $50, s29,5l insurance; s65l, 81 30
premiums; S375,2s5.l2 losses paid, or about
So pc, cent. To this add so per cent. aver
age expenses and Reinsurance reserve and the
companies have not found Maine very de-
sirable field.
Now, Withdrawing the foreign Insurance
capital from our State and can the citizens OF
Maine, with scant surplus capital Of their
own, be properly protected!
If Maine, like Massachusetts, New York,
Pennsylyania, Connecticut and other States,
had large amount Of insurance capital OF
Its own in the field, thereby enabling the peo-
pie to be benefited, and largely so, without
the need Of outside capital, then, granting
that any tax is right, to tax The foreign COM
papies might be done with some grace; but
as the matter really stands, sit is only kick
ing the hand that feeds you" to do so. If the
tax of per cent. on gross premiums is made
BY the Legislature, then large number of the
best companies will! undoubtedly withdraw
from Maine for the good reason that ''to find
the capital" and then pay tax on the bust,
ness, the people of Maine receiving more
than nine-tenths the benefit, is ''rather
rough" If the Legislature is bent upon
| ,tla ,nt hn
the reasonable thing and one to which no
good company would object 1t is manifestly
wrong to tax an insurance company on any
amount of premiums received, II those pre-
miums have been paid away to citizens OF
Maine for loss. Therefore, if law taxing
premiums, it should be on the gains OF the
business and not on the protection given the
fpeople of State.
These same reasons apply to life insurance,
the figures not being Immediately before US.
The life business in Maine is wholly done by
foreign companies, there not being a single
life company in Maine.
There is another point against said tax,
and that is it bears after all on the insured
| 1t does so in stock as well as mutual com
panies, increasing the rates in the former and
if not also in the latter, it renders the labli-
| ty for assessments greater. Insurance also
to tax property doubly. Whichever way the
advocates of the tax move, they will find
| that after all the insured will have really to
pay the onerous burden Of the proposed tax.
remonstrance, therefore, is in circulation
against the tax en- premiums of foreign COM
panies, (fre and life US recommended by
Tax Commissioner A. ". Paine. The rea-
sons given for said remonstrance are as fol-
lows
| LIST. Because taxing the premiums on Fire
Insurance is a tax levied upon an expendi-
ture which the prudent man makes to protect
and perpetuste property already taxed by the
State, yet which does not receive such pro-
lection from the State at large.
! "a. Because taxing Life premiums is a
tax imposed, in ninety cut Of every hundred
cases, upon the small savings Of men who
thereby protect their widows and orphans
from becoming a public charge. An inds
criminate tax upon life premiums would be
similar TO tax on all benefcent institutions.
Sd. Because Il tax on insurance premiums
is an unequal distribution of the burdens Of
taxation. 1t imposes upon the poor man,
who is unable to run any risk, a tax to relieve
other men who can carry their own risks but
do not contribute to the insurance fund.
! 4th. Because the people of Maine are de-
pendent, almost solely, upon capital from
! other States for ultimate protection.
! 9th. Because tax imposed upon corpo-
rations of other States, is contrary to the
principles of inter State comfy, AMI is
wrong in spirit and practice.
| This State furnishes no capital of its own
, by which 10 protec. its citizens from losses
by fire, or widows and orphans from suffering
and pauperism too often occasioned by death.
This measure, if adopted, will not only re-
act upon every person having property to in
sure, by an increase Of the rates of fire insur-
ance, and by corresponding increase in the
cost of Life Insurance by reduction of dvi
dends or otherwise, but Gas we are fully ad'
vised,) will result in the Withdrawal from the
State of nearly, if not all the best Fire In
surancc Companies, thus leaving the people
without protection, except with few mutual
and two or three stock companies.
We cannot therefore believe the Legisla-
ture of Maine will be SO rash SO unjust, 80
reckless as to agree to said tax, for the rea-
sons given; at least until Maine furnishes
goody share of its insurance capital, and even
then TO tax only met profits" Any other
method in any State, and especially in Maine,
should never be adopted and it should be
made uniform in every State in the country.
JUSTICE.