New-York tribune., 1878-06-25
LNSrR1NcE INDIcAToNS.


THE TRIBUNE has constantly urged that by
far the greater number of failures and expos
ures of banks, savings banks railroad ana
insurance companies, and firms, were really
the mere formal recognition and settlement OF
losses previously incurred; that the wedding
out of unsOund concerns was but prepara-
ton for more healthy business; and that these
changes were thus omcns, not of decay but OF
improvement and future prosperity. 1t has
been abundantly proved by experience that the
volume of business done does not decrease
because of this exclusion of unsound compa-
nies and firms, but that the good business Is
only transferred from unsafe to safe mstitu-
tions. Strong confirmation of this opinion is
given by the statistics of life insurance for
the year 1877, recently cOllated from sworn
reports to the Insurance Department OF this
State. These reports show that, although
thirty-seven companies have failed or other
wise ceased business, out of seventy-one re-
porting eight years ago, there has been an in
crease of over so per cent in the amount
of good policies outstanding. The number of
companies doing business in this State reached
the maximum in 1870, and since that date
the decrease in the number OF companies has
been so great as to cause not unreasonable
apprehension in the minds Of pohcy-holders
unfamiliar with the facts. But the failure of
weak, lll-managed, or unfortunate companies
has only left a better field for those
deserving of confidence and by this natural
law of "survival of the fttest it comes to
pass that much larger amount of insurance
is done, with far greater safety TO the in
sured, and with great increase in the assets
and surplus of the companies. The aggre-
gates for companies doing business in 1870
and in 1877 compare thus:
Number Ass5 d5l 1Pi,Ss 6l5 Gso els suTguS s Sa
i877...5I 38642O'59I S34,sl6402 6l,GOiO95
The surplus as to pOicy-hOlders is given in
the last column, and is larger by 27 per
cent for thirty-fOur companies than it was
for seventy-one; bat it must be remem-
bered that the reported surplus in 1870
was largely fictitious, and based upon unreal
or fraudulently over-valued assets, as later
events have proved. If the sound could be
distinguished from the unsOund assets, it is
certain that the increase of surplus as to pol
icy-hOlders between the two dates would aD-
pear much greater In assets, also, there
has been an increase of AZ per cent in
eight years, but the real value of as
sets has undoubtedly increased very much
more The solvent companies now iDsurng,
though only thirty-four in number, have
assets exceeding probably by GO per cent the
real assets of the seventy-one companies in
suring eight years ago, for more than half of
those companies have ceased business. The
increase in Liabilities, consisting mainly of
amounts covered by policies outstanding, has
increased 81 per cent in eight years, nOtwith-
standing decrease of 81 per cent in number
of companies insuring. Not only all the nat
ural increase of the business, but a large share
of the business formerly done by companies
since absorbed OF failed, has been gained
by those which remain. and, as the statistics
show, the policy-holders are immeasurably
safer now, with assets at the present unnat-
urally low valuation. than they were in 1870,
with assets valued at the inflated prices then
prevailing.
1t is a strong proof of the inherent strength
and recuperative power of the country, and
Of this branch of business especially, that
it has made such surprising progress in
time of unprecedented prostration. Even
where some recent decline appears in nom
inal amounts, there is actual increase, for
the fall in the price of real estate, mortgages,
and bonds has been more than 10 per cent
within the past year, and yet the nominal de-
crease in the amount of assets has been only
2.7 Der cent The decrease in amount in
sured, from the highest point, has been only
3.3 per cent but the fall in the price of gold,
and consequent increase in the value of the
dollar pledged to the assured, has been about
6 per cent within a year. The surplus as TO
policy holders has steadily increased, even IN
nominal. and still more In actual value. It is
by such changes as are here shown that, in other
branches of business as well, the country has
been steadily preparing for period of pros
perity.
MORE LOUISIANA Mod.